Record Debt Levels Signal Its Time to Sell Your Home
Record household debt hits $18.2 trillion. High mortgage debt raises foreclosure risks. Consider selling your home to regain financial control and reduce high-interest obligations..
Key Takeaways
- U.S. household debt hit a record $18.2 trillion in Q1 2025.
- Mortgage debt makes up 70% of this total.
- High debt levels increase the risk of foreclosure and financial instability.
- Homeowners should reconsider selling their home before accumulating more debt.
If you are a homeowner currently juggling credit cards, auto loans, student debt, and a hefty mortgage, the latest data from the New York Fed should be an eye opener. As of Q1 2025, total U.S. household debt reached an all-time high of $18.2 trillion, up from $18.04 trillion the previous quarter. The breakdown:
- 70% of that debt is tied up in mortgages
- Credit cards, auto loans, student loans, and HELOCs make up the rest (Source: New York Fed Consumer Credit Panel/Equifax)
What This Means for Homeowners
This growing debt burden is not just a macroeconomic concern—it directly impacts individuals like you. With interest rates still high, borrowing is more expensive. And with inflation slowly easing but not gone, every dollar counts.
If your mortgage, combined with other monthly obligations, is consuming more than 25% to 30% of your income, you may be headed toward financial trouble. (link to: Should i sell my house?)
According to a recent MarketWatch guide, most Americans are underestimating the long-term risks of carrying too much household debt. The compounding interest, especially on credit cards, can spiral quickly.
Why Selling Could Be the Smartest Option
Home equity is your strongest financial safety net. Rather than letting that equity get eaten away by missed payments, rising interest, falling credit scores, or even being destroyed completely by bankruptcy or foreclosure, you could sell your home and use the proceeds to:
- Pay off high-interest debt
- Lower your monthly financial obligations
- Rebuild savings and regain financial control
Final Thoughts
All the data points to one place, that the economy will lead American people to get into more debt as the years pass. And mortgages are the reason for that burden. If your monthly payments feel unmanageable or you are sinking deeper into debt, waiting may only worsen your financial position.
Take control while you still have options. Consider selling your home before the debt becomes overwhelming. We can help you find the perfect leaseback program for you to sell your house quickly and stay as long as you want.
Find your leaseback option here:
Sources:
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FAQs
Discover answers to common questions about our leaseback services and how we can assist you.
What is a leaseback?
A leaseback is a financial transaction where the seller of an asset leases it back from the buyer. This arrangement allows the seller to retain usage of the asset while freeing up capital. It's commonly used in real estate and business assets.
How does it work?
In a leaseback, the seller sells the asset and immediately signs a lease agreement to rent it back. This provides liquidity to the seller while allowing them to continue using the asset. The terms of the lease, including duration and payment, are negotiated at the time of sale.
Who can benefit?
Businesses looking to improve cash flow can benefit significantly from leasebacks. It allows them to access capital while maintaining operational control over their assets. Additionally, investors seeking stable returns may find leaseback agreements appealing.
Are there risks involved?
Yes, there are risks associated with leasebacks, such as potential loss of asset ownership. If the lessee fails to meet lease obligations, they may lose access to the asset. It's essential to carefully evaluate the terms and conditions before entering a leaseback agreement.
How to get started?
To get started with a leaseback, contact us for a consultation. Our team will guide you through the process and help you understand your options. We'll work together to find a solution that meets your financial needs.