Household debt increased during the fourth quarter for the first time in nearly four years despite a continued drop in mortgage debt, according to the Federal Reserve.
Debt rose just 0.3% at a seasonally adjusted rate, but marked the first increase since the first quarter 2008. For all of 2011, household debt dropped 0.9%, well below yearly prerecession increases.
Consumer credit climbed 6.9%, the fifth straight quarter of growth, and ended 2011 up 3.5%.
Residential mortgage debt continued its decline by falling another 1.5%, which is the smallest drop since the end of 2009. Home loan debt fell 2.1% in all of 2011 to $9.8 trillion.
All mortgage debt for nonfinancial sectors dropped $209 billion in the fourth quarter, though multifamily mortgages increased by $8.6 billion.
Household net worth rose for the first time in three quarters, climbing roughly $1.2 trillion to $58.5 trillion.
ascoggin@housingwire.com
