- Rescue efforts continue as crews search for survivors after the strongest earthquake to ever hit Colombia.
- Record auto loan originations hit $211 billion in the second quarter, according to the New York Fed.
- Home equity balances rose by $19 billion, indicating a trend among older homeowners to avoid high mortgage rates.
- Delinquency rates remained stable, with the overall rate falling to 4.7% of outstanding balances from 4.8% in the prior quarter.
Colombia is grappling with the aftermath of its strongest earthquake ever, as rescue teams work tirelessly to locate survivors amidst rising casualties. Concurrently, the U.S. auto loan market has reached unprecedented levels, with originations hitting $211 billion in Q2, according to the New York Fed.
The earthquake, which struck Colombia recently, has prompted extensive rescue operations, with crews searching for survivors in the rubble. The full extent of the damage and the death toll continues to rise as authorities assess the situation.
In the U.S., the New York Fed reported that auto loan originations reached a record $211 billion in the second quarter, marking a significant increase in consumer borrowing. This surge is part of a broader trend where consumers are also increasing their credit card and home equity balances.56
Despite the record auto loans, the overall consumer debt slightly decreased to $18.8 trillion during the same period, primarily due to changes in mortgage reporting. The overall delinquency rate for all forms of credit fell to 4.7% from 4.8% in the previous quarter, indicating resilience in household balance sheets despite inflation-adjusted income declines.
The Fed's report highlights a stabilization in credit card delinquency rates, although concerns remain about the rising share of credit card debt more than 90 days past due, which increased from 7.6% in late 2022 to 12.8% at the start of this year. Researchers noted that while delinquency rates are elevated, they have remained stable over the past two years, suggesting that the financial health of households is not deteriorating significantly.78
“The quake is the strongest ever recorded in the country, with crews still searching for survivors. Meanwhile, the New York Fed's report shows home equity balances rose $19 billion, and the overall delinquency rate fell to 4.7% from 4.8%.”
CBS News
