Consumer debt up 2.8% in second quarter but non-mortgage debt down: Equifax

Consumer debt up 2.8% in second quarter but non-mortgage debt down: Equifax

TORONTO — Credit rating agency Equifax Canada says total consumer debt increased 2.8 per cent to $1.99 trillion in the second quarter amid a strong recovery in the housing market.

Rising mortgage balances pushed average debt per person to $73,532, up 2.2 per cent from a year ago, despite the economic impact of the COVID-19 pandemic.

“Mortgage activity has withstood the headwinds from COVID and showed the earliest signs of recovery,” said Rebecca Oakes, assistant vice-president of advanced analytics.

However, non-mortgage debt decreased three per cent nationally to $23,035 as credit cards, auto loans and lines of credit were impacted by shutdowns in most regions of the country.

Per capita non-mortgage debt was highest in Alberta at $28,261 and lowest in Manitoba at $18,243, but it dropped the most in Alberta and least in New Brunswick.

“Other credit products began to show greenshoots of a bounceback with credit card spending starting to rise in June. Card spending for those not using a payment deferral on their credit card were effectively back to pre-COVID levels by the end of the quarter,” Oakes said.

About three million consumers used COVID-related payment deferrals at some point since February, with the 35- to 44-year-old age group having the largest percentage relying on the help at 15.1 per cent and seniors least likely to pursue deferrals at 5.7 per cent.

The delinquency rate — the percentage of balances where credit users have missed at least three payments — was 1.24 per cent nationally, up 10.6 per cent from a year ago.

The rate was highest in New Brunswick at 1.8 per cent and lowest in British Columbia at 1.02 per cent.

“Delinquency rates held up relatively well and do not reflect the sharp rise in job losses thanks to the various support mechanisms,” Oakes said.

“One in five people utilizing deferred payments were already financially stressed prior to the start of the pandemic. Some of these consumers may find it harder to recover as support mechanisms start to reduce.”

This report by The Canadian Press was first published Sept. 3, 2020.

The Canadian Press

debt

Get local stories you won't find anywhere else right to your inbox.
Sign up here

Just Posted

City’s COVID-19 cases jump to nine from six

Central zone active cases remains lowest of all zones

City of Red Deer trims staff by five per cent to deal with new economic realities

Downsizing of the municipal workforce will cut the annual budget by $7 million

Boys and Girls Club haunted house cancelled

Popular spookfest postponed because of pandemic health restrictions

Demand at Catholic Social Services jumps during pandemic

Provincial fundraising campaign launched

QUIZ: A celebration of apples

September is the start of the apple harvest

Murray, Nuggets hang on in Game 3, cut Lakers’ lead to 2-1

Murray, Nuggets hang on in Game 3, cut Lakers’ lead to 2-1

Indians clinch post-season berth; Braves claim NL East title

Indians clinch post-season berth; Braves claim NL East title

Major League Rugby to kick off fourth season in March 2021 with 13 teams

Major League Rugby to kick off fourth season in March 2021 with 13 teams

Mickelson and late-night range session key for DeChambeau

Mickelson and late-night range session key for DeChambeau

Toronto FC learns rest of rejigged MLS schedule, with a busy October ahead

Toronto FC learns rest of rejigged MLS schedule, with a busy October ahead

Andreescu out for rest of tennis season to focus on health and training

Andreescu out for rest of tennis season to focus on health and training

Cole has sharp playoff prep as Yankees rout Blue Jays 12-1

Cole has sharp playoff prep as Yankees rout Blue Jays 12-1

Jeff steps down as FC Edmonton coach, will stay on in player development role

Jeff steps down as FC Edmonton coach, will stay on in player development role

Most Read