U.S. homeowners are carrying nearly $13 trillion in mortgage debt, a figure that continues to rise even as the nation experiences a sluggish homebuying season.
Total mortgage balances grew by $131 billion during the second quarter of 2025 to reach $12.9 trillion, according to figures the Federal Reserve Bank of New York released Tuesday.
The report also found that balances tied to home equity lines of credit, or HELOCs, rose by $9 billion to $411 billion, representing the 13th consecutive quarterly increase. A HELOC allows a homeowner to borrow money at a lower interest rate than the applicant would be charged for a personal loan or credit card.
Economic researchers at the Fed said in a blog post Tuesday that mortgage and HELOC balances are climbing for one simple reason.
"Mortgages are a financial tool that has historically helped American households bridge into homeownership and to build wealth, and the mortgage market remains the largest and most important credit market for American households," Andrew Haughwout, deputy research director, wrote in an analysis of the second-quarter data.
Historically speaking, mortgage balances have grown from $9.7 trillion during the second quarter of 2020 to $12.5 trillion in the second quarter of 2024, according to the Fed's data.
In the analysis, Haughwout and other Fed economic researchers said Fannie Mae and Freddie Mac hold roughly 52 percent, or $6.5 trillion, of the mortgage debts weighing on homeowners. The Federal Housing Administration and the U.S. Department of Veterans Affairs have a combined 19 percent, or $2.5 trillion, researchers added.
More homeowners fall behind on their mortgages
A rising percentage of homeowners are also falling delinquent on their mortgage, Fed researchers said — from 0.95 percent in the second quarter of 2024 to 1.29 percent — but most of that activity is concentrated in Puerto Rico and Southern states such as Mississippi and Oklahoma.
"The recent uptick in mortgage delinquency seems to be concentrated among FHA borrowers, however, mortgage performance remains very solid when viewed in light of the twenty-year history of our data," Haughwout wrote in the blog post. "Still, with the unusual dynamics of home prices in the last five years, many eyes are on mortgage performance."
Mortgage rates have stymied homebuying activity so far this year, and lowering those rates would likely help push more residential real estate deals across the finish line, economists have said. However, mortgage rates have been trapped in the same narrow range between 6.6 percent and 7 percent for months.
The Fed data also noted other debt balances Americans held as of June 30 — including $1.21 trillion in credit cards, $1.64 trillion in student loans and $1.66 trillion in auto loans.
"This quarter’s flow of household debt into serious delinquency was mixed across debt types, with credit card and auto loans holding steady, student loans continuing to rise, and mortgages edging up slightly," Joelle Scally, economic policy adviser at the New York Fed, said in a statement. "Despite the recent uptick in mortgage delinquency, overall mortgage performance remains strong by historical standards."
