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Quarterly Household Debt Report: Key Takeaways
Q4 2025 Quarterly Report on Household Debt and Credit: Key takeaways
Here’s what LendingTree chief consumer finance analyst Matt Schulz has to say about the Feb. 10 release of the Federal Reserve Bank of New York’s Quarterly Report on Household Debt and Credit, which is generally considered the gold standard tracker of consumer debt and credit in the U.S.:
- Every form of debt the report tracks, except for home equity lines of credit (HELOCs), is at its highest level since the report began in 1999. In the fourth quarter of 2025, overall debt rose for the 22nd straight quarter, and the only time it has fallen since 2014 was in the second quarter of 2020, at the peak of lockdowns during the pandemic.
- This debt growth is the K-shaped economy at work. Many Americans are thriving, spending freely and unafraid to take on some debt in pursuit of their goals. Many others are struggling mightily, finding themselves with little choice but to take on more and more debt just to make ends meet. Meanwhile, the overall mountain of debt in America just keeps growing, and there’s little reason to believe it’s going to stop anytime soon.
- Credit card debt grew to $1.277 trillion, up 5.5% from last year. Card debt often rises in the fourth quarter, thanks to holiday shopping, leaving people with a big debt mess to clean up at the beginning of the year. This year is no different.
- Next quarter’s report on credit card debt will be extremely telling. Card debt usually shrinks in the first quarter, as people focus on paying down their holiday debt. I expect this will happen in 2026 as well. However, given stubborn inflation, high interest rates, a softening job market and other economic uncertainty, that is far from guaranteed. If we don’t see card debt fall next quarter, it will bode very poorly for the rest of 2026.
- Mortgage delinquencies continue to rise. Though not high by historical standards, they’re the highest we’ve seen since 2015. That growth is troubling, given that people tend to make mortgage payments their highest priority when it comes to paying bills. If the mortgage bill isn’t getting paid, chances are that other bills may go unpaid as well.
- It’s easy to feel hopeless and helpless as you pile on more and more debt. However, you have far more power over your money than you realize. You can use a 0% balance transfer credit card or a debt consolidation loan to tackle credit card debt. You can refinance your home to a lower rate, if possible. You can shop around for better rates and prices when buying your next vehicle. You can even call your credit card issuer and ask for a lower rate on one of your cards. It works way more often than you’d realize, but only if you ask.
Q3 2025 Quarterly Report on Household Debt and Credit: Key takeaways
Here’s what LendingTree chief consumer finance analyst Matt Schulz has to say about the Nov. 5 release of the Federal Reserve Bank of New York’s Quarterly Report on Household Debt and Credit, which is generally considered the gold standard tracker of consumer debt and credit in the U.S.:
- Mortgage debt, auto loan debt, credit card debt, student loan debt and overall debt are all the highest they’ve ever been. That’s troubling. It isn’t uncommon to see debt climb in the third quarter, but these record debt levels are another sign that it might be a tough holiday season for Americans.
- Debt will almost certainly continue to rise in the fourth quarter, in part because it almost always does. Holiday shopping is a huge part of that, and this year should be no different. While lower interest rates, thanks to the Fed, should help, there’s little reason to believe debt won’t grow in the coming months before slowing down after the first of the year.
- Rising debt in this country is never about one thing. It’s always a mix of confidence and struggle. Some people take on debt because they want to, while others do so because they don’t have any other choice. Both scenarios are taking place all over America today, but I believe that more of the debt growth right now comes from struggle than from confidence.
- As Americans’ mountain of debt grows, people need to understand they have far more power over their money than they think they do. They have to be willing to wield it, though. For example, a 0% balance transfer credit card can be a powerful weapon against credit card debt, as can a debt consolidation loan. Refinancing may be a possibility for some homeowners struggling to make payments. Shopping around and getting preapproved for financing can help you keep costs down when buying your next vehicle. Even a simple call to a creditor during a short-term rough patch can make a major difference. Most lenders have hardship programs in which they can temporarily reduce interest rates, waive fees, defer payments and make other tweaks to help you manage things better. These steps can have an impact on your financial life, but only if you pursue them. It can be worth your time to do so.
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