Household debt surges $241 billion in Q4, biggest increase since 2007: NY Fed

Greater confidence among Americans has led to a surge in household debt not seen since the recession began, according to new figures from the Federal Reserve Bank of New York.

Mortgages, credit cards, auto loans and student loans together rose $241 billion, or 2.1 percent, to a total of $11.52 trillion between October and December. It is the biggest quarterly rise since 2007.

Mortgage balances, which form the bulk of household debt, swelled $16 billion in the fourth quarter of 2013 from a year earlier. A decline in the number of bankruptcies and foreclosures mostly fueled the increase.

Credit-card balances rose by $4 billion from the previous year, auto-loan balances rose by $80 billion, and student-loan balances rose by $114 billion.

The numbers indicate Americans are more willing to borrow than they have been over the last several years, though other statistics indicate a fair amount of caution.

For example, the number of new mortgages and new auto loans fell—to $452 billion and $88 billion, respectively—though higher interest rates are likely responsible for the declines.

Source