U.S. consumer debt dropped in the last quarter for the first time in a year as mortgage originations fell to the lowest mark since 2000, according to the Federal Reserve Bank of New York's latest quarterly report.
Household debt dropped 0.2%, or $18 billion, to $11.63 trillion from January through March, snapping the longest streak of quarterly increases since the third quarter of 2008, according to the New York Fed. Borrowing for cars and education increased, it showed.
While the total level of debt was $479 billion higher than a year ago, it remains 8.2% below the peak of $12.68 trillion reached in the third quarter of 2008.
The report showed a decline in mortgage balances but increases in credit card balances, student loans and auto loans.
"A slight decline in real-estate related balances, consistent with broader housing market developments, contributed to a flat quarter for total outstanding household debt," Donghoon Lee, senior economist at the New York Fed, said in a statement. "Meanwhile, we observe continued strength in the auto loan market."
Auto loan debt increased by $30 billion to $905 billion, marking the 13th consecutive quarter of increases. The rise was spurred by a $101 billion jump in originations, the most since the third quarter of 2006.
Outstanding student loan balances on credit reports increased to $1.12 trillion as of June 30, representing a $124 billion jump from a year earlier.
Mortgages are the largest part of household debt. Mortgage debt fell by $69 billion and home-equity lines of credit declined by $5 billion in the second quarter, according to the report. At the same time, mortgage originations decreased by $46 billion to $286 billion, the lowest level of new mortgage activity since 2000.