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Mon, May 19, 2025, 10:15 AM 4 min read
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American consumer debt hit $18.2 trillion in the Q1 2025, according to the Federal Reserve Bank of New York
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While credit card and auto loan balances are both declining, student loan debt and mortgage balances have increased
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Student loan debt was also identified as the primary driver behind delinquent debt, which increased 4.3% over the last quarter
Americans' consumer debt hit an all-time high in the Q1 2025, according to the Federal Reserve Bank of New York's "Quarterly Report on Household Debt and Credit." The report, which was released Tuesday, says that household debt is at $18.2 trillion, up $167 billion since Q4 2024.
In two categories, credit card balances and auto loan balances, Americans are actually lowering their debt loads. According to the report, credit card balances fell by $29 billion and auto loan balances decreased by $13 billion.
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However, Ted Rossman, a senior industry analyst at Bankrate, told CNN, "Don't be fooled by the modest decrease[s]. Credit card balanc es and interest rates remain near record highs." According to Rossman, credit card balances are 54% higher than they were four years ago, and auto loan balances have gone up by 19% over the same period.
The long-term upward trend of credit balances is unsurprising. The NY Fed's data does not account for inflation, or factor in things like population growth, the rise of e-commerce, or the strength of consumer spending.
What is surprising to analysts and experts, however, is the drop in auto loan balances. These fell for the first time since 2011, according to CNN.
Matt Schultz, chief consumer finance analyst at LendingTree, explained the phenomenon to CNN. "I think it's a combination of people not buying [cars] because of high interest rates and high prices and also just the amount of uncertainty that we have had in the economy the last few months," he said. "That may have spurred people to hunker down a little bit."
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Two other categories of consumer debt, student loan balances and mortgage balances, saw an increase in debt loads. Student loan balances grew by $16 billion to $1.63 trillion, and mortgage balances went up by $199 billion to $12.8 trillion. Aggregate delinquency rates also rose this quarter, with 4.3% of debt now in some stage of delinquency.
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