This is the highest that delinquency rates have shot up since 2017, and the rise is driven by higher defaults among low-income and young borrowers
US President Donald Trump has a very good view of the country’s economy, despite polls showing otherwise, and now data has shown that delinquency rates have risen to 4.8 per cent on mortgages and credit cards in the fourth quarter.
This is the highest that delinquency rates have shot up since 2017, and the rise is driven by higher defaults among low-income and young borrowers.
Although the overall share of loans in some stage of delinquency is close to pre-pandemic levels, rising defaults among lower-income borrowers point to a widening economic divide, according to data released Tuesday in the Federal Reserve Bank of New York’s Quarterly Report on Household Debt and Credit.
Wilbert van der Klaauw, an economic research advisor at the New York Fed, told Bloomberg, “As household debt levels grow modestly, mortgage delinquencies continue to increase. Delinquency rates for mortgages are near historically normal levels, but the deterioration is concentrated in lower-income areas and in areas with declining home prices.”
Total household debt rose 1 per cent from the previous quarter to $18.8 trillion, the report said. The proportion of credit-card balances at least 90 days past due increased to 12.7 per cent, the highest since the first quarter of 2011, while the share of auto loans in serious delinquency edged up to 5.2 per cent, just below the peak recorded in 2010.
‘Proud of US economy’
US President Donald Trump has said that he is “proud” of the US economy and what has become of it under his second presidency. However, citizens, the real beneficiaries of that economy, think otherwise.
In an interview with NBC News, Trump was asked where he thinks the US economy has reached. The president replied, “I’d say we’re there now. I’m very proud of it.”
Potus said that the American economy is doing well and that Democrats have dropped their rhetoric against Trump’s policies. He also blamed his predecessor, Joe Biden, for raising the prices of food.
“In the last four days, it’s only four days, the Democrats have not uttered the word ‘affordability’. They’re the ones that caused the problem. I took over a mess in every way,” the president said.
Citing figures not supported by his administration’s own data, Trump claimed the gross domestic product had grown by 5.6 per cent during his presidency. Labor Department figures show the economy expanded at a solid annualised rate of 4.4 per cent in the third quarter of 2025, and it has not exceeded 5 per cent growth in any quarter since 2021, when the US economy was rebounding from the Covid-19 pandemic.
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