Fed Survey Finds More Families Stretched by Debt Payments Even as Home Equity Grew
The Federal Reserve's 2025 Survey of Consumer Finances, released Oct. 9, shows 8.6% of families spending more than 40% of income on debt payments, the highest share since 2013.
By Christopher Salem · 3 min read
The Federal Reserve Board on Friday, Oct. 9, released the 2025 Survey of Consumer Finances, its once-every-three-years look at what American families earn, own and owe. The release is new, but the data describe family finances in 2025 compared with the previous survey in 2022.
Why this matters: Homeowners gained equity over those three years, but a larger share of families now carry debt payments that take a big bite out of income. Both facts shape how much room borrowers have when they apply for a purchase loan, a refinance or a home equity line.
Cover: The Eccles Building, Federal Reserve Board headquarters. Photo: Federal Reserve, public domain, via Wikimedia Commons.
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What the survey found
According to the Fed's press release, these were the headline changes between the 2022 and 2025 surveys, with dollar figures adjusted for inflation:
| Measure | 2022 | 2025 |
|---|---|---|
| Families with debt payments above 40% of income | 6.5% | 8.6% |
| Median net housing value, homeowners | $218,900 | $230,000 |
| Homeownership rate | About 66% | 66% |
| Real median family income | $82,200 (up 7%) | |
| Real median net worth | $215,900 (up 2%) |
The Fed said the 8.6% share of families with debt payment-to-income ratios above 40% is a level last seen in the 2013 survey. It describes those families as having particularly high debt payment obligations relative to their incomes. The share of families with any debt held about steady at 77%, and median and mean debt outstanding were unchanged.
Net housing value is the home's value minus mortgages and other home-secured debt. The median for owners rose to $230,000 from $218,900.
Reading the numbers carefully
Two things can be true at once. Typical owners gained equity, and a growing minority of all families are carrying heavy payment loads. The survey does not say these are the same households, and the press release does not break the 40% group out by homeownership.
The 40% figure is the Fed's survey measure of total debt payments against total family income. It is not the same calculation a lender uses for a debt-to-income ratio on a mortgage application, which follows each program's own rules. Researchers can dig into detail through the survey data page and the Fed's summary report.
The survey also does not tell us anything about where mortgage rates go next. It is a snapshot of household balance sheets, not a market signal.
Practical takeaway
For homeowners: more equity can open options such as removing mortgage insurance or borrowing against the home, but check how a new payment fits your total monthly debt first. For buyers: add up every recurring payment before you shop, since lenders will. For loan officers: expect more applicants whose existing debts, not just the house payment, decide what they qualify for.