Consumer Borrowing Increases to New Highs

January 19, 2015

consumer credit accountsThe end of the year saw positive changes for the credit market, as many sectors reached their best levels in years! According to Equifax, November 2014 saw an increase in non-mortgage credit balances and a decrease in non-mortgage and home finance write-offs.


Equifax National Consumer Credit Trends Report shows that non-mortgage credit balances reached $3.1 trillion in November 2014, which was the highest total in more than five years. In addition, non-mortgage write-offs and home finance write-offs year-to-date were at the second-lowest level in eight years!

Other notable changes to consumer credit in November 2014 included the highest number of auto loans in five years (more than 70 million); the total balance of seriously delinquent first mortgages decreased more than 29.8 percent year-over-year to the lowest level in five years; the total new credit that originated from January to September 2015 reached a six year high ($48.1 billion); and the total number of new retail credit accounts issued in that same time period was the highest since 2007 (28.5 million).

It’s also important to note that consumers are investing more in durable, lasting goods versus items that are immediately consumed. For instance, student loans have grown from 20.2 percent to 37.3 percent of consumer debt since December 2007, while bank- and retailer-issued credit cards are down 21.9 percent. By contrast, auto loans have stayed the same, as they still make up 30.9 percent of non-mortgage consumer debt.

While consumers are making smarter credit choices for their future, these choices can lead to slower-than-anticipated economic recovery. While retail credit accounts are a smaller percentage of total consumer credit than it has been in the past, which may contribute to a sluggish economy in the short term, it’s also important to remember that overall, retail credit spending is at a six-year high!

For more information on how the consumer borrowing is changing, read the full article, “

Equifax: ‘Consumers Are Back in the Borrowing Business,’” on the Equifax Finance Blog.

Categories: Economy, Economy AOI

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Courtney Rogers

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