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March 26, 2013 | | Comments 0

Trends in Mortgage Originations and Consumer Debt

Debt and identity theft types protectionAmericans are paying off debt and starting to take out more loans than they have in recent years. The factors around this trend are explained in the recent Equifax Finance blog, “

More Americans Paying Off Debt and Opening New Lines of Credit,” which cites research from the Equifax Credit Trends report.

Here are a few of the numbers:

  • Not including mortgages, loan originations increased from $659 billion in 2011 to $750 billion in 2012. Overall, loan originations are still down from their pre-recession peak in 2006 by more than $400 billion, showing that America is heading toward a recovery, but the hard part is not over yet.
  • By mid-2012, about 4.25 million first-mortgage starts were on the books, compared to about 2.5 million at the same time in 2011.
  • Those taking out home loans are the Americans taking advantage of low interest rates, and are prime risk consumers, meaning that they carry little lending risk and have credit scores of at least 700. 80% of recent mortgage originations fit this category, while that was only true for 50% in 2006.
  • $65.5 billion in home loans were taken out in 2012; but that is only a fraction of the $295.2 billion taken out in 2006.
  • The amount of mortgage debt Americans are carrying has decreased from $9.8 trillion in 2008 to $8.4 trillion today, due to foreclosures and Americans paying down mortgage debt faster than taking it out.
  • Consumer debt (which does not include mortgage debt) has seen the opposite trend: increasing to $2.51 trillion at the end of December 2012 (though still down from the $2.57 trillion high in 2008).

Read the full article on the Equifax Finance blog, where you can also find information about credit,

identity theft types, retirement and more.

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