Serious consumer-level delinquency rates (60+ DPD) for mortgage loans—while still at historically low levels—have gradually risen from 0.89% in Q2 2023 to 1.14% in Q2 2024 and 1.27% in Q2 2025. As mortgage delinquency levels have risen, a new analysis by TransUnion (NYSE: TRU) highlights the direct correlation between payment-to-income (PTI) ratios and mortgage delinquency. PTI compares a borrower’s monthly debt obligations to their gross monthly income and can help lenders more accurately identify consumers who may be at higher risk of falling into delinquency.
The analysis, conducted throughout 2024, focused on how rising debt levels and fluctuations in PTI across various credit products—such as credit cards, Home Equity Lines of Credit (HELOCs), and student loans—may serve as early warning signs of financial stress. These trends were evaluated specifically among the nearly 57 million mortgage consumers who were current on their loans at the time of the study, providing a broad and relevant sample for assessing emerging risk factors.
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The study revealed a strong and consistent link between changes in PTI for non-mortgage products, such as credit cards, and subsequent increases in mortgage delinquency rates in the following year. This finding underscores the importance of monitoring PTI trends over time across a consumer’s entire credit portfolio, as increases in non-mortgage debt obligations can be a leading indicator of potential trouble in mortgage performance.
| As Consumer Payment-to-Income Ratios Increased for Credit Cards, The Likelihood of Mortgage Delinquency One Year Later Followed | ||||
| 2023 Mar | 2023 Jun | 2023 Sep | 2023 Dec | |
| Credit Card Consumer Payment-to-Income Ratio (%) |
2.18 | 2.25 | 2.31 | 2.33 |
| 2024 Mar | 2024 Jun | 2024 Sep | 2024 Dec | |
| 60+ DPD Mortgage Delinquency (%) |
0.42 | 0.46 | 0.56 | 0.63 |
| Source: TransUnion US consumer credit database | ||||
“The study clearly demonstrates that an increase in payment-to-income ratios for select non-mortgage credit products serves as a strong and reliable signal that these borrowers are significantly more likely to experience mortgage delinquency in the future,” said Jason Laky, executive vice president and head of financial services at TransUnion. “Moreover, evolving patterns in credit card usage may provide additional early indicators of emerging financial stress, offering valuable insights for lenders.”
A similar trend emerged when analyzing PTI ratio patterns for both HELOCs and student loans. In each case, there was a clear and consistent positive correlation between rising PTI ratios and an increased likelihood of mortgage delinquency. This suggests that as borrowers allocate a greater portion of their income toward servicing these types of debt, their ability to stay current on mortgage payments may become increasingly strained.
Mortgage lenders should implement a consistent and proactive schedule for collecting consumers’ cross-wallet credit data—ideally on a quarterly basis—to gain the earliest possible insight into emerging risks of mortgage delinquency. By analyzing trended credit data, lenders can uncover valuable patterns in consumer credit behavior and emerging risks that often precede changes in credit scores. This deeper, historical perspective enables more informed risk assessments and enhances the ability to anticipate financial stress before it becomes visible through traditional scoring metrics.
“In this challenging economic environment, lenders must leverage every available tool at their disposal to more effectively segment and manage risk,” said Satyan Merchant, senior vice president and auto and mortgage business leader at TransUnion. “Trended credit data can play a critical role in identifying shifts in key attributes such as aggregate excess payment, non-mortgage delinquencies, and debt-to-income ratios. These innovative insights can help pinpoint consumers who are at a higher likelihood of becoming delinquent and, importantly, enable lenders to proactively contact and work with consumers at heightened risk of default to help them stay on track and avoid falling behind on payments.”
Tools like TruVision for Managing Customer Portfolios empower mortgage lenders with deeper, more actionable insights into customer behavior, enabling smarter line management decisions and more effective account treatment strategies. By leveraging these capabilities, lenders can stay ahead of evolving consumer needs—identifying behavioral patterns, predicting future actions, and proactively diagnosing account risks. This allows for timely interventions to help mitigate rising delinquencies and potential losses.
TransUnion is a global information and insights company with over 13,000 associates operating in more than 30 countries. We make trust possible by ensuring each person is reliably represented in the marketplace. We do this with a Tru™ picture of each person: an actionable view of consumers, stewarded with care. Through our acquisitions and technology investments we have developed innovative solutions that extend beyond our strong foundation in core credit into areas such as marketing, fraud, risk and advanced analytics. As a result, consumers and businesses can transact with confidence and achieve great things. We call this Information for Good® — and it leads to economic opportunity, great experiences and personal empowerment for millions of people around the world.
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