The New York Fed’s Quarterly Report on Household Debt and Credit, released Friday, showed what is, overall, a modest increase in U.S. household indebtedness. Overall debt, counting mortgages, HELOCS, credit cards, student loans, and auto loans, reached 12 point 12 trillion dollars by the end of 2015. Only 5 point 4 percent of that debt was in any stage of delinquency, however. Mortgage and HELOC debts comprised almost 8 point 74 trillion dollars—approximately 72 percent—of the overall debt.
The bank attributed the debt growth partially to flat mortgage balances. According to the report, balances on home equity lines of credit continued a decline that began more than four years ago, and which fell last quarter by 5 billion dollars. New loan originations continued at a tempered pace, and mortgage originations decreased slightly from the third quarter, to 437 billion dollars. Fifty-six percent of all new mortgage balances went to borrowers with credit scores above 760.
Fannie Mae has priced its latest credit risk sharing transaction in the Connecticut Avenue Securities at 945 million dollars, and the transaction is scheduled to settle on February 18, according to an announcement from Fannie Mae. The CAS series was created to reduce taxpayer risk and increase the role of private capital in the mortgage market. Through all of its risk transfer programs, Fannie Mae has transferred a portion of the risk on more than half a trillion dollars in single-family mortgages.