Key Takeaways
- U.S. household debt hit a record $18.2 trillion in Q1 2025.
- Mortgage debt makes up 70% of this total.
- High debt levels increase the risk of foreclosure and financial instability.
- Homeowners should reconsider selling their home before accumulating more debt.
If you are a homeowner currently juggling credit cards, auto loans, student debt, and a hefty mortgage, the latest data from the New York Fed should be an eye opener. As of Q1 2025, total U.S. household debt reached an all-time high of $18.2 trillion, up from $18.04 trillion the previous quarter. The breakdown:
- 70% of that debt is tied up in mortgages
- Credit cards, auto loans, student loans, and HELOCs make up the rest ( Source: New York Fed Consumer Credit Panel/Equifax)
What This Means for Homeowners
This growing debt burden is not just a macroeconomic concern—it directly impacts individuals like you. With interest rates still high, borrowing is more expensive. And with inflation slowly easing but not gone, every dollar counts.
If your mortgage, combined with other monthly obligations, is consuming more than 25% to 30% of your income, you may be headed toward financial trouble. (link to: Should i sell my house?)
According to a recent MarketWatch guide, most Americans are underestimating the long-term risks of carrying too much household debt. The compounding interest, especially on credit cards, can spiral quickly.
Why Selling Could Be the Smartest Option
Home equity is your strongest financial safety net. Rather than letting that equity get eaten away by missed payments, rising interest, falling credit scores, or even being destroyed completely by bankruptcy or foreclosure, you could sell your home and use the proceeds to:
- Pay off high-interest debt
- Lower your monthly financial obligations
- Rebuild savings and regain financial control
Final Thoughts
All the data points to one place, that the economy will lead americans to get into more debt as the years pass. And mortgages are the reason for that burden. If your monthly payments feel unmanageable or you are sinking deeper into debt, waiting may only worsen your financial position.
Take control while you still have options. Consider selling your home before the debt becomes overwhelming. We can help sell your home quickly, as is and let you stay as a renter as long as you want.
Check out our program here:
Sources:
Chart source: New York Fed Consumer Credit Panel, Equifax
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