Americans are defaulting on their debts at near-historic rates, a collision between long-term structural strains and more contemporary financial pressures that some believe could shake the entire economy.

The issue was put into sharp relief by the New York Fed’s most recent Household Debt and Credit report , which showed that household debt hit a record $18.6 trillion in the third quarter of 2025, having climbed $228 billion from the second quarter.

Credit card balances alone jumped $24 billion, reaching an all-time high, while the share of balances in serious delinquency—90 days past due—climbed to a nearly financial-crash level of 7.1 percent.

Auto loans tell a similar story, with serious delinquency rates at 3 percent, the highest since 2010. And a spike in resulting defaults has

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