US Credit Card Balances, Borrowers Jumped 10% in 2025
By Reuters | 19 Feb, 2026

Total unsecured loan balances surged to $276 billion in 2025 as 2 million more struggling lower-income consumers used their credit cards to meet household expenses.

Robust demand from subprime customers spurred growth in U.S. unsecured loans last year with their combined balances surging 10% to a new high of $276 billion, according to TransUnion's Credit Industry Insights Report.

    Some 26.4 million consumers carried those loans as of end-December, up from 24.5 million a year earlier.

"As interest rates began to fall, many consumers are consolidating their credit card balances into unsecured loans," said Michele Raneri, vice president and head of U.S. research and consulting at TransUnion.

    Lower-income consumers are also using these loans as a stopgap measure to deal with higher costs of living that have not been followed by similar raises in wages, she added.

Credit card issuers have increased lending to lower-income consumers, with total balances rising 4% last year to $1.15 trillion. But they have reduced initial credit limits to deal with the risk, the report said. Delinquency rates have been slowly rising over the last quarters.

SLOWER GROWTH

TransUnion forecasts slower growth this year for the volume of new credit extended.

Raneri said the credit markets are now going back to more 'normal' growth levels, after strong fluctuations since the pandemic.

The credit bureau expects a 5.7% rise in new unsecured loans in 2026, as well as a 4% rise in mortgages and 4.2% climb in home refinancings. 

"People that have recent mortgages taken with higher interest rates are starting to have access to refinancing and we expect that demand to grow," TransUnion's vice president added.

Auto loans are expected to shrink 1.5% this year, after having risen around 5% last year with consumers accelerating purchases to avoid the impact of import tariffs. 

(Reporting by Tatiana Bautzer; Editing by Edwina Gibbs)