Lisa Chow is the economics reporter at WNYC. She tries to explore in her stories surprising aspects of New York’s many economies—in plain view or hidden, in neighborhoods or sectors.
Consumers Shed $1 Trillion of Debt From 2008 Peak
Monday, November 08, 2010
Consumer debt continued to fall in the third quarter, but at a slower pace than previous quarters.
The New York Federal Reserve reports that in the last two years, consumers have reduced their debt load by $1 trillion, or 7.4 percent, but it's not clear whether it's a result of banks tightening their credit standards, or consumers voluntarily changing their spending habits.
Mortgages made up the bulk -- 74 percent -- of consumers' total outstanding debt, which stands at $11.6 trillion, while home equity lines of credit, car loans and credit cards each made up 6 percent of that total. By the end of the third quarter, 11.1 percent of all debt was in some stage of delinquency, down from 11.6 percent a year ago.
California had the largest debt balance per capita -- about $75,000 per person -- followed by Nevada, New Jersey and Arizona. In New York, Florida and Illinois total outstanding debt per capita stood at about $50,000, closely in line with the national average.
The report, which was published Monday, also says nationwide nearly 460,000 consumers received foreclosure notices from July 1 to September 30 this year, 6.4 percent fewer from a year ago, while the number of new bankruptcies rose slightly at 1 percent.