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Fed’s Second District Reports Lower Consumer Distress Rates than National Average

seal-on-moneyOverall consumer distressed rates were lower in the Federal Reserve’s Second District than in the rest of the country, according to a report released by the New York Fed.

The New York Fed’s Regional Household Debt and Credit Snapshots, covering the period through the end of June 2015, includes 27 snapshots and various consumer credit data on mortgages, student loans, credit cards, auto loans, and delinquencies for New York, northern New Jersey, and western Connecticut.

In New Jersey, 16.2 percent of consumers have seriously delinquent debt (90 days or more overdue) or debt that was in third-party collections, compared with the national rate of 20 percent for the reporting period. New York and Connecticut also reported overall consumer distress rates (14.8 percent and 14.9 percent respectively) lower than the national rate.

According to the New York report, a lower percentage of consumers have a mortgage than the national average (21.5 percent compared with 25.9 percent), while a higher percentage of consumers in New York have home equity lines of credit (HELOCs) than the national average (5.8 percent compared with 5.0 percent). The average balance on a mortgage in New York was higher than the national average in Q2 ($220,100 compared to $185,700) as was the HELOC balance in New York ($75,100 compared to $65,200).

The percentage of New York mortgage borrowers who were seriously delinquent was considerably higher than the national average (4.2 percent compared to 2.6 percent) while the percentage of HELOC serious delinquencies in New York and the number of mortgage borrowers who became delinquent (30 days or more overdue) during the quarter were on par with the national rates (2.3 percent on seriously delinquent HELOCs for New York, 2.2 percent nationwide; 1.4 percent for both New York and the nation on newly delinquent mortgage borrowers).

Connecticut had a larger share of borrowers with a mortgage than the national share (28.5 percent compared to 25.9 percent) and a larger share of borrowers with a HELOC (7.6 percent compared to 5 percent). The average balance on those mortgages was higher in Connecticut than the national average ($228,000 compared to $185,700); likewise for HELOC balances at the end of Q2 ($78,200 in Connecticut compared to $61,200 for the nation). Connecticut’s average mortgage balance of $228,000 for Q2 was considerably higher than the national average of $185,700, as was Connecticut’s HELOC balance ($78,700 to $61,200). Connecticut’s share of mortgage borrowers who were seriously delinquent as of the end of Q2 was half a percentage point higher than the national share (3.1 to 2.6) while the Connecticut’s seriously delinquent HELOC share was slightly lower  than the national average (1.9 to 2.2). Connecticut’s share of newly delinquent borrowers in Q2 was the same as the national share (1.4 percent).

New Jersey, meanwhile, had only a slightly higher share of borrowers with a mortgage than the national rate (26.5 percent compared to 25.9 percent) while the percentage of HELOC borrowers in the state was nearly 2 percentage points higher than the national average (6.9 percent compared to 5.0). New Jersey had the highest mortgage balance of the three states in Q2 at $234,100, compared to $185,700 nationally; New Jersey’s HELOC balance at the end of Q2 was $81,000, compared to the national HELOC average balance of $61,200. The serious delinquency rate for mortgage borrowers in New Jersey was double the national average in Q2 (5.2 percent compared to 2.6) while the HELOC serious delinquency rate in New Jersey was only slightly higher (2.5 percent compared to 2.2). The share of new delinquencies in New Jersey during Q2 was a tick below the national average (1.3 percent compared to 1.4).

About Author: Brian Honea

Brian Honea's writing and editing career spans nearly two decades across many forms of media. He served as sports editor for two suburban newspaper chains in the DFW area and has freelanced for such publications as the Yahoo! Contributor Network, Dallas Home Improvement magazine, and the Dallas Morning News. He has written four non-fiction sports books, the latest of which, The Life of Coach Chuck Curtis, was published by the TCU Press in December 2014. A lifelong Texan, Brian received his master's degree from Amberton University in Garland.
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