Ed. loans weigh heavily on household debt: N.Y. Fed
NEW YORK (2/19/15)--Delinquency rates nationwide improved overall in the fourth quarter of 2014, with the exception of student loans, which recorded an 11.3% increase, according to the Federal Reserve Bank of New York.
The bank's 4Q 2014 household debt and credit survey reported an increase of $117 billion in outstanding household debt from the third quarter. The 1% uptick puts total household debt at $11.83 trillion as of Dec. 31, 2014.
"Although we've seen an overall improvement in delinquency rates since the Great Recession, the increasing trend in student loan balances and delinquencies is concerning," said Donghoon Lee, research officer at the Federal Reserve Bank of New York. "Student loan delinquencies and repayment problems appear to be reducing borrowers' ability to form their own households."
Outstanding student loan balances now stand at $1.16 trillion. Student loans have the highest delinquency rate of any form of household credit, having surpassed credit cards in 2012. The number of student loan borrowers--who have an average balance of $27,000--has risen to 43 million.
Balances were largely up across the board from third quarter, led by mortgages ($39 billion) and student loans ($31 billion). Auto loan debt and credit card debt increased by $21 billion and $20 billion, respectively.