Consumer borrowing for car loans, personal loans, and general credit card use zoomed 39 percent in April, year over year, and 11 percent above April 2019’s level, according to credit reporting agency Equifax.
In March, lenders made three million loans for vehicle leases and purchases, Equifax noted, 53 percent more than a year earlier and the most on record for one month, Equifax said. 
The total value of the vehicle loans reached $73.6 billion, also a record for any March and up 59 percent from March 2020.
Lenders issued almost six million general-purpose credit cards in March, more than in any other March and 32 percent more than in March 2020.
About 1.4 million of those new credit cards were given to people with subprime credit scores, a 28 percent increase from 2020 and 19 percent above 2019, the Wall Street Journal noted.
Some banks have begun to loosen the strict loan qualification standards adopted when the economic crisis began; in May, lenders mailed 127 million sales letters to homes, compared to 60 million a year before, according to Mintel Comperemedia, which tracks such mailings.
Roughly 602,000 of March’s new vehicle loans went to subprime borrowers, 31 percent more than a year before and totaling $11.7 billion, the most money ever lent to iffy borrowers for personal vehicles.
The surge in borrowing reverses 2020’s trend, when people paid down debt out of fear of the future and government stimulus checks let people spend without borrowing.
In addition to new vehicles, people are taking vacations and eating in restaurants, credit card usage shows, things people were unable or unwilling to do during last year’s economic crisis.
Consumer debt will keep growing, first as people run out of stimulus money and then as they resume their pre-crisis borrowing habit, Brendan Coughlin, Citizens Financial Group’s director of consumer banking, told the WSJ.
“There’s a significant increase in consumer credit demand and a growing appetite to use credit on things like those vacations that were postponed for 18 months,” Equifax vice president Tom Aliff commented to the WSJ.
TREND FORECAST: Having scrimped and gone without during the 2020 economic crisis, consumers have stopped denying themselves long-delayed pleasures and are reverting to their old habit of piling on debt.
However, now is not the time to go into hock.
With corporate and government debt also at record levels, a return to lockdowns or some other economic jolt could cost the economy jobs and send millions of households into arrears or bankruptcy.
Again, when the Fed raises interest rates the equities and housing bubbles will deflate. And, the longer they keep interest rates low, the higher inflation will rise. 

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