Household debt fell $13bn in Q2 2026; card stress held at 6.97%
The New York Fed puts household debt at $18.771 trillion for June 2026. The total dipped; new card delinquencies ran at 4.6 times the mortgage pace.
- What happened
- The New York Fed's Quarterly Report on Household Debt and Credit, published on August 11, 2026, put total household debt at $18.771 trillion at the end of June 2026, down $13 billion in the quarter. Mortgage balances fell $74 billion while card, auto and home equity balances rose.
- Why
- Mortgages are 69.9% of household debt, so a small fall in mortgage balances can outweigh rises everywhere else. Delinquency is better read through transition rates, which count only balances that newly fall behind.
- The numbers that matter
- $18.771tnHousehold debt, end of June 20264.7%Share of debt in some stage of delinquency, Q2 20266.97%Card balances newly 90+ days late, annualized, Q2 20261.52%Mortgage balances newly 90+ days late, annualized, Q2 2026
- Why it matters
- The total is dominated by mortgages, but the stress is concentrated in unsecured borrowing such as credit cards, where a missed payment turns into serious delinquency far more often.
- What happens nextas we saw it on 7 Oct 2026
- As of October 4, 2026 the New York Fed had not announced a date for its third-quarter 2026 report; the third-quarter 2025 report was published on November 5, 2025. Our release calendar is at /calendar/.
Card balances crossed into serious delinquency at 4.6 times the mortgage rate.
| Student loans | 7.8% |
|---|---|
| Credit cards | 7.0% |
| Other | 5.2% |
| Auto loans | 3.0% |
| Mortgages | 1.5% |
| Home equity lines | 1.1% |
American households owed $13 billion less at the end of June 2026 than at the end of March. The Federal Reserve Bank of New York's Quarterly Report on Household Debt and Credit, published on August 11, 2026, put the total at $18.771 trillion, a 0.1% dip. Nearly all of the fall came from one line: mortgage balances, down $74 billion. Card, auto and home equity balances all rose.
The figure that says more about household strain sits lower in the release. In the second quarter, credit card balances that had not been seriously late were crossing into serious delinquency, 90 days or more past due, at an annualized rate of 6.97%. For mortgages the rate was 1.52%. This piece sets out where the debt is, what that transition rate measures, and why it can move in a different direction from the headline delinquency rate.
Where the $18.771 trillion sits
The New York Fed's table for Q2 2026 shows total debt down $13 billion on the quarter and up $383 billion on Q2 2025. Its report adds that balances were up $4.6 trillion since the end of 2019, “just before the pandemic recession”. The data come from the New York Fed Consumer Credit Panel, which is built from a nationally representative random sample of Equifax credit report data.
| Category | Balance | Change on Q1 2026 | Change on Q2 2025 | Share of total |
|---|---|---|---|---|
| Mortgages | $13.117tn | −$74bn | +$182bn | 69.9% |
| Auto loans | $1.713tn | +$28bn | +$58bn | 9.1% |
| Student loans | $1.651tn | −$7bn | +$13bn | 8.8% |
| Credit cards | $1.263tn | +$21bn | +$54bn | 6.7% |
| Other | $0.568tn | +$6bn | +$28bn | 3.0% |
| Home equity lines (HELOC) | $0.459tn | +$13bn | +$48bn | 2.4% |
| Total | $18.771tn | −$13bn | +$383bn | 100% |
Mortgages are seven dollars in every ten. That is why a quarter in which mortgage balances shrink can pull the total down even while every other secured and unsecured line except student loans grows. Mortgage originations were $505 billion in the quarter, which the New York Fed called “largely steady”; repayments and payoffs outran them.
Year-earlier balance = June 2026 balance minus the annual change. HELOC: $48bn ÷ $411bn = 11.7%. Other: $28bn ÷ $540bn = 5.2%. Credit cards: $54bn ÷ $1,209bn = 4.5%. Auto: $58bn ÷ $1,655bn = 3.5%. Mortgages: $182bn ÷ $12,935bn = 1.4%. Student loans: $13bn ÷ $1,638bn = 0.8%. Total: $383bn ÷ $18,388bn = 2.1%.
HELOC balances rose $13 billion, “the 17th consecutive quarterly increase”, and HELOC limits rose $19 billion. Aggregate credit card limits rose $85 billion, or 1.1%. Auto loan originations were $211 billion.
Shrinking first-mortgage balances alongside 17 quarters of HELOC growth are consistent with owners leaving an existing mortgage in place and borrowing against their equity separately. The report counts balances; it does not record why households borrow.
What a “transition into delinquency” measures
There are two kinds of delinquency figure in the report, and they answer different questions. The first is a stock: the share of all outstanding debt that is late at a point in time. At the end of June 2026 that was 4.7%, down 0.1 percentage points from the end of March.
The second is a flow, which the New York Fed calls a transition rate. It counts only balances that were in better standing a quarter earlier and have newly crossed a lateness threshold.
In the release's words: “Rates represent annualized shares of balances transitioning into delinquency.” The flow into serious delinquency is “the balances that have newly become at least 90 days late in the reference quarter divided by the balances that were” less than 90 days past due in the previous quarter. The report's data dictionary describes a transition rate as “the new (seriously) delinquent balance, expressed as a percent of the previous quarter's balance that was not (seriously) delinquent.”
The difference matters because the stock is sticky. A loan that went 90 days late two years ago and has been neither repaid nor written off still sits in it. The flow strips that history out. It works like a hospital's admissions count against its bed count: the beds show how many are ill, while admissions show how fast new cases are arriving.
For every $1,000 of card balances that were not seriously late at the end of March 2026, an annualized rate of 6.97% corresponds to $69.70 crossing 90 days late over a year at the second-quarter pace. For mortgages, 1.52% corresponds to $15.20. Ratio: 6.97 ÷ 1.52 = 4.6. The figures describe a pace across all balances, not the share of borrowers.
Card and auto stress held; mortgages edged up
| Category | Q2 2025 | Q1 2026 | Q2 2026 |
|---|---|---|---|
| Student loans | 12.88% | 10.86% | 7.83% |
| Credit cards | 6.93% | 7.10% | 6.97% |
| Other | 5.42% | 5.16% | 5.19% |
| Auto loans | 2.93% | 2.97% | 3.00% |
| Mortgages | 1.29% | 1.48% | 1.52% |
| Home equity lines | 1.15% | 1.15% | 1.15% |
| All debt | 2.91% | 2.83% | 2.57% |
Read across the rows, the card and auto figures barely moved over the year. That is the point the New York Fed itself made: the rates are not climbing, but they are not falling back either.
Delinquency rates across most products have held steady over the past two years. Still, new delinquencies for auto loans and credit cards remain at elevated levels, a trend we'll continue to monitor.Joelle Scally, Economic Policy Advisor, Federal Reserve Bank of New York, press release, August 11, 2026
Mortgages: 1.52% − 1.29% = 0.23 percentage points; 0.23 ÷ 1.29 = 17.8% higher than in Q2 2025. The rate is still the second lowest of the six categories, above only home equity lines at 1.15%.
Student loans: a falling flow and a rising stock
The flow into serious delinquency for student loans fell to 7.83% in Q2 2026 from 12.88% in Q2 2025. Over the same period the share of student loan balances 90 or more days past due rose to 10.6%, from 10.3% in Q1 2026. The release warns that student loans were an exception, “with the continued impact of the re-reporting of defaulted student debt causing some distortions.”
A smaller stream of new delinquencies can still raise the stock if fewer balances leave it than enter it. That is the clearest illustration in this report of why the two measures need to be read together, and why the student loan figures carry the agency's own caveat.
Foreclosures, bankruptcies and the size of the economy
The report says “about 137,000 consumers had a bankruptcy notation added to their credit reports in 2026Q2, a small increase from the previous quarter,” and “about 55,000 individuals had new foreclosures on their credit reports, a slight improvement from the previous quarter.”
The Bureau of Economic Analysis GDP series, as carried on FRED after the BEA third estimate of September 30, 2026, puts second-quarter 2026 GDP at $32,563.0 billion at a seasonally adjusted annual rate, against $30,630.2 billion in Q2 2025. Debt ÷ GDP: $18,771bn ÷ $32,563.0bn = 57.6%; a year earlier, $18,388bn ÷ $30,630.2bn = 60.0%. Nominal GDP grew 6.3% over the year; household debt grew 2.1%.
Two cautions apply. Debt is a balance at a moment and GDP is a flow of output over a year, so the ratio is a sense of scale, not a measure of how hard the debt is to service. And both are nominal figures: BEA reports real GDP growth of 2.2% at an annual rate in the quarter against 8.5% in current dollars, so much of the ratio's fall reflects higher prices rather than more output.
The May 12, 2026 release put the Q1 2026 total at $18.794 trillion. The August release's Q2 total of $18.771 trillion and its −$13 billion change imply a Q1 figure of $18.784 trillion, $10 billion lower. The New York Fed's tables are revised, so quarter-on-quarter comparisons should use the latest release only.
What it means for your money
Aggregate rates describe a pool of debt. For one household the outcome is binary: a balance is either 90 days late or it is not. What the pool shows is where that event is most common, and the answer is unsecured borrowing.
- A card balance turns bad far more often than a mortgage. At the second-quarter pace, $69.70 of every $1,000 in card balances crossed 90 days late per year, against $15.20 for mortgages. A mortgage is secured by the house; a card balance is secured by nothing.
- Growth is in revolving lines. Card balances rose 4.5% and HELOC balances 11.7% over the year. The Federal Reserve raised its target range to 3.75%–4.00% on September 16, 2026; on any balance whose rate is variable, that change passes through to the cost of carrying it.
- A buffer is the mechanism that keeps a household out of these flows. An emergency fund covers the months in which a payment would otherwise be missed.
None of this tells you what to do with your own balances. It shows where, across 18.771 trillion dollars of borrowing, missed payments were turning into serious delinquency between April and June 2026.
Sources
- Household Debt Balances Decreased Slightly; Credit Card Delinquency Transition Rates Remained Steady (Quarterly Report on Household Debt and Credit, Q2 2026), August 11, 2026Federal Reserve Bank of New York · Oct 4, 2026 · Primary source
- Quarterly Report on Household Debt and Credit, 2026:Q2 (August 2026)Federal Reserve Bank of New York, Center for Microeconomic Data · Oct 4, 2026 · Primary source
- Household Debt Balances Rise Slightly as Delinquency Transition Rates Hold Steady (Q1 2026 report), May 12, 2026Federal Reserve Bank of New York · Oct 4, 2026 · Primary source
- New York Fed to Release Q2 2026 Household Debt and Credit Report on August 11 (media advisory)Federal Reserve Bank of New York · Oct 4, 2026 · Primary source
- Household Debt and Credit Report: background and data source (New York Fed Consumer Credit Panel / Equifax)Federal Reserve Bank of New York · Oct 4, 2026 · Primary source
- Household Debt Balances Grow Steadily; Mortgage Originations Tick Up in Third Quarter (Q3 2025 report), November 5, 2025Federal Reserve Bank of New York · Oct 4, 2026 · Primary source
- GDP (Third Estimate), Industries, Corporate Profits, State GDP, and State Personal Income, 2nd Quarter 2026; State PCE, 2025 — September 30, 2026U.S. Bureau of Economic Analysis · Oct 4, 2026 · Primary source
- Gross Domestic Product (GDP), billions of dollars, seasonally adjusted annual rate, Q2 2026 (updated September 30, 2026)U.S. Bureau of Economic Analysis via FRED · Oct 4, 2026 · Primary source
- FOMC statement, September 16, 2026Federal Reserve Board · Sep 16, 2026 · Primary source
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