Delinquency Rates Rising on Credit Cars, Auto Loans

A government report shows warning signs for consumers as household debt has increased and delinquency rates remain elevated for auto and credit card loans.

The Federal Reserve Bank of New York has released its latest quarterly report on Household Debt and Credit.

Debt increased by $93 billion in the last three months of 2024, the report found.

Credit card balances increased by $45 billion from the previous quarter and reached $1.21 trillion at the end of December 2024.

Auto loan balances saw a $11 billion increase and stood at $1.66 trillion.

Credit card delinquencies ticked up in the fourth quarter.

Auto loans and credit card loans in serious delinquency, defined as 90 or more days past due, were up.

"High auto loan delinquency rates are broad-based across credit scores and income levels," said Wilbert van der Klaauw, Economic Research Advisor at the New York Fed.

Lenders wrote off $46 billion in seriously delinquent loans during the first nine months of 2024, a 50% increase from the same period in 2023, according to findings by BankRegData.

Capital One reported its annualized write-off rate for credit card debt hit 6.1% in November, up from 5.2% in 2023.

The country's total credit card debt surpassed $1 trillion in mid-2023, fueled by post-pandemic spending and rising balances, with $37 billion overdue.