Household Debt, Delinquencies, Collections, and Bankruptcies

By Wolf Richter –  WOLF STREET

Disposable income (according to data from the Bureau of Economic Analysis) grew by 0.9% in Q2 from the prior quarter. The total household debt grew by 0.6% in Q2. So the debt grew more slowly than income.

At $17.8 trillion, the debt amounts to 85.2% of disposable income, down a hair from the prior quarter (85.5%), and roughly unchanged over the past five quarters, and a historically low burden

Household debts that were 30 days or more delinquent at the end of Q2 ticked up to 3.95%, from 3.88% of total debt balances — a minuscule increase that shows up in the flattening of the curve. The delinquency rate is still lower than any time before the pandemic.

Household debts that were 90 days or more delinquent by the end of Q2 remained unchanged at a historically low 1.83% of total balances, still lower than any time before the free-money pandemic.

The number of consumers with bankruptcy filings are easing up from the historic bottom, and are still far below prepandemic normal.