How Distressed Are Consumers? Reconciling Diverging Credit Card Delinquency Measures

Lee, Donghoon; Mangrum, Daniel; Scally, Joelle; Sinha, Tejas; Van der Klaauw, Wilbert

doi:10.59576/lse.20260811

Discussion Paper

How Distressed Are Consumers? Reconciling Diverging Credit Card Delinquency Measures

Abstract: Total debt balances declined slightly by $13 billion in the second quarter of 2026, according to the latest Quarterly Report on Household Debt and Credit from the New York Fed’s Center for Microeconomic Data. Mortgage and student loan balances saw a small decline, while there were increases across other debt products. Delinquency rates across most products remained fairly stable. Still, between 2022:Q3 and 2026:Q1, the percentage of credit card balances 90+ days delinquent rose from 7.6 percent to 12.8 percent, prompting concerns that Americans are falling behind on their debt payments at rates not seen since the Great Recession. Yet the flow delinquency rate—which captures the rate of new delinquencies—has remained relatively stable for almost two years. In this post, we use data from the New York Fed Consumer Credit Panel (CCP) to better understand the state of the consumer, and to explain the difference between our two measures of delinquency. We find that the stock delinquency rate is rising because of a pool of stale, charged-off debts that lenders have been reporting for longer durations, rather than a fundamental worsening in the incidence of delinquency.

JEL Classification: G51;

https://doi.org/10.59576/lse.20260811