By Arlenys Tabare
This Tuesday, the Federal Reserve Bank of New York reported in its most recent report that US household debt hit an all-time high in the first quarter of this year, amidst strong economic pressure and uncertainty after a high inflation that does not subside and continues to weigh on consumers’ pockets.
According to the FED analysis, The historical debt figure reached $18.8 trillion dollars so far from January to March, which includes high mortgage costs, accumulated credit card debt, coupled with student and car loans.
Although New York FED analysts described Americans’ overall credit as “stable,” they expressed that certain economic weaknesses are observed among low-income and younger households.
The report broke down that the largest balances owed come from mortgages and auto loans, which amounted to $13.2 billion dollars and $1.69 billion dollars respectively.
While Credit card debt showed a decrease of $25 billion with outstanding balances of $1.25 trillionthe same for student debts that decreased slightly by $1.66 trillion dollars, but according to the FED report, many borrowers are behind in their payments.
What are the cities that are paying the most household debt?
Given the report from the New York FED, WalletHub published an analysis rating the cities in the United States that are paying the most debt, noting that “in the first quarter of this year there was a $339 billion decrease in inflation in the debt of American households.”
The decrease was seen in the 182 cities that were used for the analysis, observing that the debt varies significantly between one entity and another. According to the WalletHub report, where there was the greatest decrease was in:
- Santa Clarita, CA
- Fremont, California
- San Jose, CA
- Gilbert, AZ
- Irvine, California
- Rancho Cucamonga, CA
- Huntington Beach, California
- Chula Vista, California
- Scottsdale, AZ
- Pearl Metropolis, Hawaii
In this regard, Chip Lupo, WalletHub analyst, commented that “in the case of Santa Clarita, Fremont and San José, California, the three cities with the largest declines, residents are quite wealthy and responsible with creditso the large reduction in its debt is not surprising.”
“A significant decrease in the average debt of a city’s residents is an excellent sign: shows that people are not only keeping up with their payments, but also reducing their loans,” Lupo highlights.
Keep reading:
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- Bank of The USA economists assure that the FED will not cut interest rates until the second half of 2027
