Household debt hits $2.6T
Canadian household debt has climbed to about $2.6 trillion, raising systemic vulnerability concerns for lenders and consumers alike reported. Revolving credit growth and high leverage are flagged as key early-warning indicators for mortgage performance models.
Total outstanding balances rose 4.3% year‑over‑year while the number of credit‑active Canadians increased just 1.2%, according to TransUnion’s Q4 2025 Credit Industry Insights report newsroom.transunion.ca. TransUnion also reported a steady migration into lower‑risk cohorts with the super‑prime share climbing to about 42.1% from 40.2% a year earlier, signalling concentration of balances among higher‑quality borrowers newsroom.transunion.ca. Mortgage balances were a central driver of the increase, rising about 4.3% year‑over‑year to roughly $1.91 trillion as reported alongside TransUnion’s release, while Statistics Canada data show mortgages account for about three‑quarters of household credit market debt theepochtimes.com. Revolving products also expanded: TransUnion noted growth in lines of credit and credit‑card balances, with Canadian credit‑card balances having reached about $124 billion in recent reporting, highlighting the early‑warning role of revolving usage for models tracking mortgage performance transunion.ca. The Bank of Canada’s staff analysis estimates roughly 60% of borrowers renewing in 2025–26 will face higher monthly payments, with average increases of about 10% for 2025 renewals and 6% for 2026 renewals versus December 2024 payment levels bankofcanada.ca. BMO Economics projects roughly 1.8 million Canadian mortgages will renew over the next 12 months, with a renewal peak around June 2026 that concentrates exposure for lenders and insurers economics.bmo.com. MLS activity and prices have softened into 2026, with CREA reporting national home sales fell 5.8% month‑over‑month in January and the national sales‑to‑new‑listings ratio sliding to 45% after a surge in new listings, a dynamic that moderates mortgage origination risk even as balances rise creastats.crea.ca. Mortgage pricing has also shifted: 5‑year fixed offerings at broker channels were trading near the high‑3% range while many big‑bank posted averages sat around the low‑4% area in early March 2026, creating material spreads lenders will monitor when stress‑testing renewal portfolios ratehub.ca.
