Credit card debt approaches record as delinquency data draws new scrutiny

Total U.S. household debt edged down slightly in the second quarter, but credit card balances climbed to $1.26 trillion, nearing an all-time high, according to the latest quarterly household debt report from the Federal Reserve Bank of New York.

The headline numbers

The report, based on a nationally representative sample of anonymized credit data, found that total household debt fell $13 billion, or about 0.1%, to $18.8 trillion. Mortgage balances led the decline, dropping $74 billion to $13.1 trillion, while auto loan balances rose $28 billion to a record $1.71 trillion and home equity lines of credit climbed $13 billion to $459 billion. Credit card balances rose $21 billion, a 1.7% quarterly increase, to $1.26 trillion, edging closer to the $1.28 trillion record set in the fourth quarter of last year. Student loan balances, meanwhile, fell $7 billion to $1.65 trillion. "Delinquency rates across most products have held steady over the past two years," said Joelle Scally, economic policy advisor at the New York Fed. "Still, new delinquencies for auto loans and credit cards remain at elevated levels, a trend we'll continue to monitor."

A 'K-shaped economy'

Roughly 175 million Americans hold credit cards, and New York Fed researchers said about 60% of them do not pay off their balances in full each month, leaving those households carrying ongoing interest-bearing debt. "To us it reflects this K-shaped economy," researchers said on a press call accompanying the report, pointing to a growing divide between households with a financial cushion and those living paycheck to paycheck, vulnerable to a single unexpected expense tipping them into delinquency.

A more complicated delinquency picture

A separate, widely circulated statistic has fueled concern that American households are falling behind on credit card payments at a pace not seen since the aftermath of the 2008 financial crisis: the share of credit card balances in "late-stage delinquency," or more than 90 days past due, jumped from 7.6% to 12.8% between the third quarter of 2022 and the first quarter of 2026. New York Fed researchers pushed back on that headline reading in a companion blog post, cautioning that the figure is a lagging indicator that largely reflects a growing pool of older, already charged-off debts that have continued to sit on credit reports for longer than they once did, rather than a fresh wave of borrowers newly falling behind. In earlier years, the researchers said, banks tended to remove those stale, charged-off debts from credit reports sooner, which had kept the older delinquency measure looking artificially low by comparison. New credit card delinquency transitions, the more forward-looking measure the researchers say is the better signal to watch, have stayed elevated but essentially flat over the past year, with 6.97% of balances transitioning into some stage of delinquency.