From Investing.com: 2025-06-05 08:43:00

The New York Fed’s household debt report for the first quarter reveals a concerning trend in consumer debt. Credit card delinquencies have surged, with more than 7% of loans in serious delinquency. Auto loan delinquencies are also on the rise, nearing their Great Financial Crisis peak. The report highlights the emergence of past-due student loans, with 7.74% delinquent in 1Q25. This poses a systemic risk, affecting over 6 million borrowers and limiting their access to credit. The broader economic impact could be significant, with potential for increased default risks and economic slowdown.

In light of these risks, it’s crucial for consumers to conduct thorough due diligence when choosing a bank to safeguard their money. Larger banks face multiple issues, including rising risks in consumer debt and commercial real estate. Community banks with conservative business models offer a safer alternative. The banking industry’s shift towards bail-ins poses additional risks to deposit holders. Engaging in due diligence and understanding these risks is essential in protecting one’s financial assets.



Read more at Investing.com: US Credit Card Delinquencies Surge Near Great Financial Crisis Levels