ATLANTA—Non-mortgage U.S. credit balances in November climbed to $3.1 trillion, the highest level in more than five years, according to a new report.
The latest Equifax National Consumer Credit Trends Report indicated auto loan balances rose 9.6% annually in November to $965 billion, retail issued credit card balances increased 4.8% to $71 billion, and bank issued credit cards increased 4.7% to $611.7 billion.
The total balance of non-mortgage write-offs year-to-date for November was $73.4 billion, the second-lowest level in eight years. Similarly, the total balance of home-finance write-offs year-to-date in November was $91.2 billion, also the second-lowest level in eight years.
"The Great Deleveraging has clearly ended and U.S. consumers are back in the borrowing business, but how they borrow has greatly changed from prior to the Great Recession," said Amy Crews Cutts, SVP and chief economist at Equifax. "Today, while auto loans make up 30.9% of non-mortgage consumer debt—just as they did in December 2007 at the Recession's start—student loans have grown from 20.2% to a whopping 37.3% and bank and retailer issued credit cards are down to 21.9% of consumer debt from 31.4%."
Cutts continued, "One way to read this change is that consumers now value investment (in their education and durable goods like cars) over immediate consumption, which is good for our economy over the long run. But, with the exception of new car production, sluggish consumption slows economic growth in the short-term, partially explaining the slower-than-hoped-for economic recovery."
Other highlights:
- The total number of outstanding auto loans year-to-date in November was more than 70 million, the highest level in more than five-years.
- Auto loan serious delinquencies, defined as loans 60 days or more past due, stood at 1.04% in November as a share of balances, a decrease from 1.15% from the same time a year ago.
- The total number of new retail card accounts issued January-September was 28.5 million, a year-over-year increase of 2.5% and the highest since 2007.
- Total new credit (bank issued cards) originated year-to-date in September was $183.9 billion, a six-year high and an increase of 25.9% from same time a year ago.
- Delinquent first mortgages, those 30 days or more past due, represented 4.54% of outstanding balances in November, a decrease from 5.87% from the same time a year ago.
- The total balance of seriously delinquent first mortgages (90 days past due or in foreclosure) was $198.8 billion in November, a decrease of more than 29.8% year-over-year and the lowest level in more than five years.
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