New York Fed: Delinquency Rises to 4.8% but Remains Well Below Crisis Levels (Jan 2026)

Total debt in delinquency rose to 4.8% in Q4 2025, the highest since 2017, as mortgage and student loan transitions into default increased, according to the New York Fed. Auto, credit card, and home equity delinquency rates remained roughly stable. The increase reflects the resumption of reporting under pandemic forbearance, not a systemic crisis. While delinquency metrics have trended worse from pre-pandemic highs, the risk remains limited: seriously delinquent debt-to-income is about 2.5%, near 2019 levels and nowhere near 2009-2010 peaks. Household debt-service payments as a share of disposable income, though rising over time, remain strong. This lens underscores that "better or worse" is relative; consider "good or bad" alongside it. For example, inflation is improving but remains above the Fed’s target; job creation has slowed but remains positive; retail sales growth has slowed but remains record high.