If you want to get worried about the economy, look at who isn’t paying their bills.
My trusty spreadsheet’s review of the Federal Reserve Bank of New York’s first-quarter study of credit files found a growing inability to make timely debt payments.
The data tracks debts – including mortgages, credit cards, auto and student loans – in 11 big states and the nation going back to 2003. These statistics only consider individuals with credit histories — roughly 90% of the population.
To start 2026, this math shows 2.1% of California consumer debts were 90 days or more late. That’s the highest since 2020’s first quarter – just as the pandemic was beginning to upend the economy.
Now, this is still below the 3.5% average dating back to 2003, and the skipped-payment peak of 12.6% in 2009’s fourth quarter amid the Great Recession.
Still, it’s an unnerving trendline. The good news, for California, is that Golden Staters are better than most Americans at paying their bills. Nationwide, 3% of consumer debt was delinquent in the first quarter, the highest since 2020’s first quarter.
And just like California, this tardiness remains historically modest. It’s less than the 3.7% average since 2003, and nowhere near the peak of 8.6% in 2010’s first quarter.
Also, ponder poor bill-paying habits within two California arch-rivals.
Texas had a 4.2% delinquency rate in the first quarter, the highest since 2014’s second quarter. While 3.9% delinquency rate to start 2026 is off from the recent high of 4.13% in 2025’s second quarter, it’s the state’s highest since 2019’s second quarter.
Early 2026’s skipped bill payments reveal a financially stressed consumer with monetary headaches that are, for now, problematic but manageable.
Making the mortgage
Think about one large subset of this problem: tardy mortgage payments.
Just 0.7% of California mortgage balances are late. Yes, that’s the highest since 2020’s first quarter, but it’s a delinquency pace that’s off from the 2.7% average of the last 23 years and the peak of 13.2% in 2009’s fourth quarter.
Nationwide, 1.1% of home loans are late, the highest since 2018’s second quarter, but below the 2.6% long-term norm and the 2010 first-quarter peak of 8.9%.
In Texas, mortgage delinquencies at 1.5% at the start of 2026 were the highest since 2015’s first quarter. Florida’s 1.6% first-quarter delinquency rate was just below the 1.7% recent high in 2025’s third quarter, which was the highest since 2018’s fourth quarter.
Less borrowing
Another sign of consumer financial stress is a slowdown in loan usage.
California’s $87,710 in consumer debt per capita in the first quarter was up just 0.1% over the year. That is a far slower pace of new debts compared with the 3% six-year growth rate.
Similar cooling was seen nationwide. U.S. per capita debts of $63,545 were up 2% in a year vs. a 4% six-year growth rate.
Texans have $60,710 debts per capita, up 3% in a year vs. a 5% six-year growth rate. And Floridians owe $62,500 per capita, up 2% over the past year, compared with a 5% growth rate over the past six years.
Jonathan Lansner is the business columnist for the Southern California News Group. He can be reached at jlansner@scng.com
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