U.S. household debt rose at the fastest pace since 2013 in the second quarter, driven by a mortgage boom as Americans took advantage of low borrowing costs and sought more space to work from home, Bloomberg News reported. Household liabilities climbed $313 billion to $14.96 trillion as of the end of June, a 2.1% rise from three months earlier, the Federal Reserve Bank of New York said in a report published yesterday. Most of the increase came in mortgage balances. With the average 30-year rate declining in the period, millions of Americans with good credit took the opportunity to refinance and cut their monthly payments. Some 44% of the country’s entire $10.4 trillion stock of mortgages was originated in the 12 months through June, according to the New York Fed. Credit-card balances, while they rose by $17 billion in the second quarter as the consumer economy rebounded, are about $140 billion lower than at the end of 2019.
