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Low mortgage rates have helped push U.S. mortgage debt to the highest level ever. The last time Americans had nearly this much mortgage debt was back in 2008, but delinquencies are lower.

In the second quarter of 2019, Americans' mortgage balances totaled $9.4 trillion, $162 billion more than the previous quarter, according to data released Tuesday by the Federal Reserve Bank of New York. This surpassed the previous peak of $9.3 trillion in mortgage debt recorded back in the third quarter of 2008.

Overall, mortgage originations increased by $130 billion from the previous quarter to $474 billion as Americans sought to take advantage of low rates, particularly through refinancing. This marked the highest quarterly loan volume since the third quarter of 2017.

Mortgage balances represent the largest component of household debt — and the boost in mortgage originations helped drive total household debt in the U.S. to its highest level ever, $13.86 trillion.
Mortgage debt chart

While many new home loans were given to borrowers during the second quarter, lenders were still extremely selective as to who received these funds. The median credit score for borrowers who received a new mortgage in the second quarter was 759, which falls within the "very good" range on most trackers. Only 10% of borrowers had credit scores under 651.

This stinginess on the part of lenders appears to be paying off in terms of delinquency rates. "While nominal mortgage balances are now slightly above the previous peak seen in the third quarter of 2008, mortgage delinquencies and the average credit profile of mortgage borrowers have continued to improve," Wilbert van der Klaauw, senior vice president at the New York Fed, said in the report.

Only 0.9% of mortgage balances were 90 or more days delinquent, down from 1% in the previous quarter. And only 10.5% of home loans in the early stages of delinquency (between 30 and 60 days late) transitioned to late delinquency (90 or more days), the lowest rate since 2005.

Meanwhile, 43% of loans in early delinquency were "cured," meaning the borrowers became current on their debt obligations.