Debt Rises, but Who’s Borrowing?

In a report released Tuesday, the Federal Reserve Bank of New York noted that aggregate consumer debt rose from last quarter, citing an increase of $241 billion dollars in the fourth quarter of 2013. The figure represents the largest quarter-to-quarter increase since 2007.

Data came from the recently released "Household Debt and Credit Report."

Total household debt is on the rise as well, notching higher to $180 billion from Q4 2012 to Q4 2013. The rise is the first 4 quarter increase since 2008, as net household borrowing resumes.

The report makes comparisons to 2006, noting pre-financial crisis levels as a baseline. "Mortgage and home equity line of credit (HELOC) balances, in particular, grew more slowly in 2013 than in 2006," the report said.

In 2013, balances fell for the lowest credit score borrowers. The report notes that lowered balances were a result of charge-offs from previous foreclosures.

The report commented, "All groups, even those with subprime credit scores, increased their mortgage balances in 2006. Now, the modest mortgage balance increases we see are mainly coming from high credit score borrowers."

Younger consumers are borrowing more across all lines of credit, irrespective of loan types. "In 2013, the increased credit card and mortgage debt among the young and the riskless led to a turnaround in the trajectory of overall debt," the report said.