Total household debt rose to $18.59 trillion in the third quarter of 2025, according to data released yesterday by the Federal Reserve Bank of New York and WalletHub. On a per-household basis, balances reached $154,152, still $13,466 below the real-term peak. Liquidity metrics remain a relative bright spot: the debt-to-deposits ratio is 23% better than its historical average, and debt-to-assets sits at 9.36%, 24% better than long-run norms. For credit & collections leaders, that combination means capacity to repay remains, for the most part, intact, even as strain concentrates in specific products and consumer segments.
Why it matters for repayment risk
- The aggregate looks stable, but repayment pressure is migrating to higher-rate, unsecured debt and younger/lower-income borrowers. Targeting, segmentation, and hardship pathways will matter more than a one-size approach.
By the numbers:
- Mortgages: $13.07 trillion (up $47 billion quarter over quarter). Average per household $108,425; still $14,041 below record.
- HELOCs: $422 billion (up $8 billion quarter over quarter). This marks the fourth straight third quarter increase, an early sign homeowners are tapping equity for liquidity.
- Auto: $1.66 trillion (down $11 billion quarter over quarter). Avg household balance $13,727, just $726 under the 2020 high. Payment burdens remain elevated even as balances edged down.
- Student loans: $1.65 trillion (up $4 billion quarter over quarter). Avg household $13,711; delinquency transitions are rising industry-wide post-repayment restart.
- Credit cards: $1.23 trillion (near record). Avg household $10,227; card debt equals 6.73% of deposits, up 1.94% year over year — a signal of growing reliance on revolving credit.
Consumer sentiment & ability to pay
- 1-yr inflation expectations: 3.4% (up).
- Expected earnings growth: 2.4% (down, lowest since Apr. 2021).
- Probability unemployment is higher in a year: 41.1% (up).
- Perceived probability of missing a minimum payment (next 3 months): 12.6% (down vs. 12-month average), suggesting near-term resilience even as job-market worries rise.
Bottom line:
