Despite warnings to curb their borrowing, an outlook released this past week says Canadians will take on record levels of consumer debt in 2014, in part to buy cars. The average Canadian's non-mortgage debt is slated to jump to a new high of $28,853 by the end of 2014, up more than a $1,000 from an estimated $27,743 in the fourth quarter of this year, according to a forecast from TransUnion credit bureau
Should this outlook come to fruition debt levels at the end of 2014 would be 29 per cent – or $6,500 – higher than they were at the same time in 2008.
The TransUnion figures, which exclude mortgage debt, are comprised of how much Canadians owe on their credit cards, instalment loans, lines of credit and car loans. Car and truck sales in Canada have jumped in 2013 and the length of car loans has been getting longer, with many people stretching out the payments on their new wheels for six or eight years.
Although consumer debt levels are expected to rise, the national delinquency rate is forecast to drop from 1.76 per cent at the end of this year to 1.66 per cent at the end of 2014, according to TransUnion.