Consumers in each of the nation’s 25 largest cities added debt throughout the months of July, August, and September. This is compared to the previous year, ending a multi-year trend in which several cities continued to show declines in overall consumer debt, according to the latest Equifax National Consumer Credit Trends Report. “Consumers appear more confident in the economy and are moving forward with their lives and borrowing money again,” said Assad Lazarus, Senior Vice President, Product and Customer Experience at Equifax Personal Information Solutions.
Earlier in 2015, when Equifax last reported a similar report, 19 of the nation’s largest 25 cities showed declines in consumer debt compared with a year ago. The new report shows a reversal of this trend; all major metro posted gains, with the largest experienced by Houston (+7.4%), Denver (+5.4%), Dallas (+4.8%) and Orlando (+3.8%).
“Overall, the data paints an encouraging picture of the American consumer and the U.S. economy,” said Lazarus.
What else does the report tells us about consumer financial behavior across the United States?
- Mortgage markets are improving, in part because mortgages are the largest single component of consumer debt. In fact, just three major metropolitan areas – New York, Cleveland, and Miami – saw a decrease in those balances. This is a marked difference from past reports where many cities showed a similar decline.
- Non-mortgage debt, meanwhile, continues to show significant year over year growth in every major U.S. cities. Nine cities experienced double-digit increases in non-mortgage debt compared to a year ago, with Orlando leading the way with an increase of 13.9% and Miami close behind at 13.2%. Again, this suggests that consumers remain confident and are poised for growth.
- Detroit had the smallest amount of non-mortgage growth at 4.9%. In fact, only Detroit and Minneapolis experienced a lower rate of year-over-year growth in non-mortgage debt through the third quarter of 2015 compared to the same time period in 2014.
Dennis Carlson, Deputy Chief Economist with Equifax, contributed to this article.
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