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First quarter shows rise of non-mortgage debt and decline of delinquency rates

June 8th, 2017  |  Home

The first three months of 2017 have seen a 1.9% increase in the average non-mortgage debt across Canada, but a 1.45% decrease in 90-day delinquency rates.

According to a report put forth by TransUnion Canada, the 1.9% increase brought the average non-mortgage debt to $21,696. The report noted that 20.4 million Canadians carried some form of credit card debt, a 3.5% increase from 2015 first quarter end. Also noted was that 2.5 million subprime borrowers now have access to credit cards and the past two years have seen a 14% increase in subprime borrowers signing up for additional cards.

TransUnion broke their 2017 Q1 non-mortgage debt findings into four categories: auto loans, credit cards, installment loans, and lines of credit. Auto, credit and installment all saw increases of 2.67%, 2.23%, and 5.46% respectively. Lines of credit saw a 1.81% decrease.

And while the amount of non-mortgage debt has increased, the delinquency rates for subprime borrowers contributing to that debt has declined. A 1.45% decline brings the Canadian delinquency rate to 2.72%. Toronto saw the largest decrease in the country at 7.55%, followed by Winnipeg at 2.9%, and Montreal at 2.51%.

“More consumers are gaining access to credit, and credit limits have been increasing at a strong rate during the last two years. At the same time, serious delinquency rates have remained relatively low. It’s especially encouraging to see some major Canadian markets lead the way in delinquency declines and credit growth, as it bodes well for Canada’s overall economic activity.” noted Matthew Fabian, Director of Research and Consulting at TransUnion Canada.