LendingTree: US Consumer Debt Approaching $4T

LendingTree said in its debt report for the month of November that based on recent holiday shopping and credit card spending, credit card balances will swell by about 5 percent through the end of the year to more than $1 trillion.

That would mean that the $4 trillion level of debt is approaching for U.S. consumers, said the report.

The company said that into the first nine months of this year, the nearly $4 trillion in debt included $2.9 trillion in non-revolving debt tied to student loans, fixed loans and auto loans.

According to LendingTree, credit card APRs are more than three percentage points higher than had been seen only a few years ago, which of course translates to higher payments on that debt, and where the current average APRs are at more than 16 percent.

The data as analyzed by LendingTree shows that in just five years, in the U.S., debt holders will have increased outstanding debt by $1 trillion, having moved past the $3 trillion level in 2013. The previous $1 trillion shift, from $2 trillion to $3 trillion, took more than a decade.

LendingTree posits that though home buying has slowed as of late, unemployment remains low and consumer confidence remains high.

Collectively, said the firm, “consumers appear to be more than capable to carry the additional debt.” That is because delinquency rates for all types of debt, mortgage and otherwise, remain at below-average levels.

As covered previously in this space, debt continues to march higher, and in its Consumer Debt Outlook in May 2018, LendingTree said that Americans owe more than 26 percent of their income on consumer debt, up from 22 percent in 2010.