The Federal Reserve found a small increase in consumers' willingness to borrow and banks' willingness to lend, according to the _Household Debt and Credit Report_ for the second quarter of 2011 released Monday.
[IMAGE]According to the report, most types of loans showed small decreases in balances.
Both mortgage loans and home equity lines of credit decreased by about $20 billion during the second quarter of 2011. This was a 0.2 percent drop for mortgage balances and a 3 percent drop for home equity lines of credit (HELOC).
At the end of the second quarter, the Fed calculated mortgage indebtedness at 8.3 percent below its peak.
[COLUMN_BREAK]Mortgage debt now makes up 71 percent of total household debt.
At the same time, HELOC indebtedness was 12.7 percent below its peak.
During the second quarter of 2011, about 2.2 percent of mortgages moved from performing status to delinquent. This rate has been improving for three consecutive quarters.
At the end of the quarter, 9.9 percent of outstanding debt was reportedly delinquent. This is down from 10.5 percent the previous quarter and 11.4 percent one year ago.
This was the sixth consecutive quarterly decline in delinquency, according to the Federal Reserve report.
New foreclosure filings decreased 22.8 percent from the previous quarter. In total, about 284,000 new foreclosure notes were filed in the second quarter of 2011.
""Outstanding consumer debt remained essentially flat, down just $50 billion, in what was basically a repeat of the previous quarter, said Andrew Haughwout, vice president in the Research and Statistics Group at the New York Fed.
""This is more evidence that the pace of consumer deleveraging that began in late 2008 has slowed,"" Haughwout said. ""During the next few quarters we will gain a better understanding of whether this is a permanent or temporary break in the decline of total outstanding consumer debt.""