The share of student loan debt entering serious delinquency, 90 days or more past due, surged to 12.9% in the second quarter — the highest rate for any quarter in records dating back to 2003, a new report from the New York Fed shows.
Roughly 3% of all consumer debt was at least 90 days delinquent in the April-to-June period, up from 2.8% in the prior quarter and the highest level since early 2020. The findings suggest more Americans are struggling to keep up financially as elevated interest rates and a cooling job market take a toll on household budgets.
In dollar terms, total household debt rose by 1% to $18.39 trillion in the second quarter and around 4.4% of outstanding debt was in some stage of delinquency — a percentage that NY Fed researchers called “elevated.”
While it’s the highest level since early 2020, the second quarter delinquency rate was still far below the record levels in late 2009 and early 2010, when nearly 12% of consumer debt was in some stage of delinquency.
The New York Fed’s latest report shows credit card and auto loan delinquencies have remained mostly stable, but after a nearly five-year hiatus, federal student loan payments are once again being reported to credit bureaus and those delinquencies have skyrocketed ever since.
New seriously delinquent balances by loan type (90 days or more past due), according to the Federal Reserve Bank of New York
- Student loans
- Q2 2025: 12.88%
- Q1 2025: 8.04%
- Q4 2024: 0.70%
- Credit Cards
- Q2 2025: 6.93%
- Q1 2025: 7.04%
- Q4 2024: 7.18%
- Auto Loans
- Q2 2025: 2.93%
- Q1 2025: 2.94%
- Q4 2024: 2.96%
Student loan delinquencies are climbing even as borrowers face stiffer consequences now that the U.S. government has resumed referring missed payments for debt collection.
In fact, millions of student loan borrowers could be at risk of having their wages garnished as soon as this summer, according to estimates from credit bureau TransUnion.
Delinquent student loan borrowers have already seen their credit scores take a hit.
In the first quarter of 2025, 2.2 million newly delinquent student loan borrowers saw their credit scores drop by 100 points, and more than 1 million saw drops of 150 points or more, according to a separate New York Fed report.
It’s unclear if the surge in student loan delinquencies has peaked, but financial pressures on borrowers show no sign of easing.
The Education Department recently began charging interest to borrowers with loans in the Saving on Valuable Education plan, a Biden-era program that was blocked by a federal court.
Last month, the Trump administration began reaching out to the nearly 7.7 million borrowers enrolled in the SAVE plan with instructions on how to move to a different repayment plan.
Student loan debt is the third-largest consumer debt category, totaling $1.64 trillion in the second quarter, behind only mortgages ($12.94 trillion) and auto loans ($1.66 trillion).