by The Federal Reserve Bank of St. Louis issued its inaugural edition of Quarterly Debt Monitor reporting on trends in consumer debt. The report, titled “Consumer Debt Rises for Tenth Quarter in a Row,” by Don E. Schlagenhauf and Lowell R. Ricketts, compared the four largest metropolitan statistical areas in the district of the Eighth Federal Reserve with national averages. The focus was on mortgages, home equity lines of credit (HELOC), automobile and student loans, and credit card balances. The article concludes that after a period of deleveraging following the recession of 2007-2009, consumer debt is on the rise again particularly in the areas of automobile and student loans. Home mortgage debt went up to a lesser degree for people in the 31- to 40-year and 66- to 75-year age ranges, but went down in the age range in between.
The report discusses trends in serious delinquency: defined as debt more than 90 days overdue. Nationally, student loan and credit card debt represent the highest levels of delinquency, though student loan delinquency has been trending upward while credit card delinquency is on the decline. Serious delinquency has also been trending upward in the area of auto loans.
The report closed with a special section, “Auto Loan Originations by Equifax Risk Score” in which it addressed whether the increase in auto debt was related to relaxation of credit worthiness standards. While the report found that much of the increased auto debt was in the area of subprime loans, the data did not include information about individual income, and therefore, the report reached no conclusion as to whether the increase in auto loans was likely to lead to an increase in serious delinquency in that area.
Recent Developments in Consumer Liabilities
Year-over-Year Percent Change from 2015:Q1 to 2016:Q1
| United States | St. Louis MSA | Louisville MSA | Memphis MSA | Little Rock MSA | |
| % Change in Debt | |||||
| Total | 2.1 | 1.14 | 2.26 | 1.46 | 1.11 |
| Mortgage | 1.29 | 0.11 | 1.6 | –1.41 | –1.57 |
| HELOC | –2.56 | –5.53 | –0.59 | –5.88 | –1.54 |
| Auto | 8.92 | 8.27 | 8.23 | 9.41 | 10.71 |
| Credit Card | 2.7 | 1.96 | 0.01 | 6.05 | 3.61 |
| Student | 3.06 | 1.39 | 1.82 | 4.92 | 1.42 |
| Change in Serious Delinquency Rate | |||||
| Mortgage | –0.79 | –0.32 | –0.24 | –0.44 | –0.47 |
| HELOC | –0.6 | –0.89 | 0.32 | –0.05 | –0.23 |
| Auto | 0.12 | –0.01 | 0.45 | –0.37 | 0.63 |
| Credit Card | –0.56 | –0.18 | –0.52 | –0.55 | 0.25 |
| Student | 0.12 | –1.54 | 1.68 | –1.69 | 0.4 |
NOTES: St. Louis, Louisville, Ky., Memphis, Tenn., and Little Rock, Ark., are the largest MSAs in the Eighth District. Figures show the difference in a particular type of debt compared to the total of that type of debt the previous year. The serious delinquency rate is the share of outstanding debt for which payment is at least 90 days past due. Figures are rounded.
SOURCE: Federal Reserve Bank of New York/Equifax Consumer Credit panel.