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A new study by TransUnion indicated that the composition of loans people typically carry, known as the consumer loan wallet, has materially changed in the last decade for both older and younger consumers.
Among younger consumers, the TransUnion report found that the percentage of mortgage loans that make up the total consumer loan wallet has dropped dramatically in the last decade, while it has remained steady among older consumers for that same time period.
Mortgage loans have made up a substantial portion of the consumer loan wallet for all ages across the last decade. Across all age tiers, mortgage loans have made up between 70 and 80 percent of the mortgage loan wallet on average for the last decade. For the 60 and older age tier, that number is about on par with that of the average for all age groups. Though it has slowly increased in the last decade, it still stayed between 70 and 80 percent for the entire 10-year period.
For the 20 to 29 age tier, however, the percentage of mortgage loans that made up the consumer loan wallet has dramatically decreased in the last decade. In 2005, mortgage loans accounted for about 63 percent of borrowing in the consumer loan wallet. By 2009, that number had dropped slightly to 59 percent, but by 2014, it had plummeted to about 42 percent.
The consumer loan wallet is calculated by breaking down the average total borrowing of consumers in different age groups by the average percentage of the total balance in each type of loan. The types of loans that contributed to the consumer loan wallet were mortgage, auto, card, home equity (HELOC), student loans, and all other types of loans.
