Non-mortgage delinquencies soar to 15-year high, raising red flags for Canadian households

Urban squeeze: Delinquency rates surge in Canada’s biggest cities

Money.ca’s research shows that the growing gap between rising debt and delinquencies is being felt most acutely in high-cost urban centres. In Toronto and Vancouver, delinquency rates jumped 24.16% and 19.00%, respectively. Both cities also saw above-average debt growth, 4.66% in Toronto and 4.53% in Vancouver, suggesting residents are increasingly relying on credit to cope with unaffordable housing and rising everyday expenses.

Montreal saw the largest increase among major cities at 27.06%, underscoring the pressure lower-income households face in a city where average debt remains below the national average at $16,894. Delinquency there is rising faster than in nearly any other metro, pointing to systemic strain tied to income stagnation and the growing cost of living.

These city-level trends reflect broader provincial patterns. In Ontario, average non-mortgage debt climbed 4.38% to $22,423, while delinquencies soared 23.78%, the second-highest provincial increase after Quebec, which saw a 24.16% spike.

Even in typically resilient provinces, the cracks are showing. Alberta, which carries the country’s highest average debt load at $24,555, saw delinquency rates rise 17.39%, pointing to the impact of economic volatility in resource-dependent regions.

In cities like Edmonton and Calgary, where debt remained relatively flat, delinquencies still surged by 18.88% and 17.23%, respectively, highlighting the widening disconnect between borrowing levels and repayment capacity.

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Search trends show growing financial anxiety

While Equifax’s latest report offers a snapshot of Q1 2025, Money.ca’s year-over-year Google Trends analysis offers a behavioural window into how Canadians responded throughout the preceding 12 months. As economic pressures mounted, Canadians increasingly turned to the internet for guidance, and in some cases, last-resort solutions.

Interest in budgeting tools surged: Searches for "budget planner" rose more than 150% year-over-year, a signal that many Canadians are actively seeking ways to regain control of their finances before falling behind.

But the spike in online searches didn’t stop at budgeting. Interest in high-cost borrowing options such as "payday loans" — often a marker of financial desperation — jumped nearly 28%. At the same time, search volumes for “personal bankruptcy” and “garnishment” rose 4% and 6%, respectively, suggesting a growing number of Canadians are exploring legal or court-mandated debt solutions.

“These trends reveal a growing reliance on short-term credit and legal remedies as household budgets become more fragile,” a Money.ca spokesperson said. “But the sharp increase in budgeting tool searches also suggests many Canadians are trying to take back control before they fall deeper into debt.”

Equifax’s data reinforces this trend: Even with a modest 3.79% increase in overall non-mortgage debt, delinquencies have surged by more than 19%, indicating that Canadians are not just borrowing more, but struggling to keep up.

Together, the numbers highlight a financial turning point for many households, one where proactive planning and crisis management are unfolding in parallel, and often out of necessity.

Young adults and pre-retirees feeling the squeeze

Canada’s growing debt problem isn’t hitting all generations equally. According to Money.ca’s analysis, the financial strain is most acute at the bookends of adult life, among young people just starting out, and older adults approaching retirement.

Rebecca Oakes, Vice-President of Advanced Analytics at Equifax Canada, said in a statement that these trends point to “a more vulnerable consumer landscape,” as economic pressures continue to outpace income growth.

Delinquency rates rose 17.02% among Canadians aged 18 to 25, many of whom are juggling student debt, low wages and a rising cost of living. For this group, a single missed payment can quickly spiral into long-term financial trouble.

Canadians in their late 30s and early 40s, often balancing mortgages, car payments and childcare costs, saw the sharpest rise in delinquencies, up 24.40% year-over-year. This age group typically carries the highest financial burdens, and it shows in the data.

Pre-retirees (aged 56 to 65) were not far behind, with delinquencies rising 16.88%, alongside the largest increase in debt of any age group at 6.28%. As they try to shore up savings while still carrying significant debt, many are finding it harder to stay financially afloat.

Even retirees, who generally have the lowest average debt levels at $14,575, weren’t immune. Their delinquency rate rose 8.12%, as fixed incomes struggle to keep up with rising living and healthcare costs.

Across all groups, Equifax’s data confirms the broader trend: Non-mortgage delinquencies have risen 19.14% year-over-year, reaching levels not seen in more than a decade.

From first paycheques to final pensions, Canadians are finding it harder to keep up.

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Outlook: Cracks in Canada’s financial foundation

Taken together, the latest data from Equifax and the behavioural trends analyzed by Money.ca point to a troubling shift: Many Canadians are nearing the edge of their financial capacity.

The growing gap between debt and delinquencies shows that credit is no longer a cushion — it’s becoming a crisis point. With inflation still high, interest rates elevated and wages failing to keep pace, the ability to manage even modest debt is slipping out of reach for many households.

Unless policymakers step in with targeted relief, such as enhanced debt management programs and broader financial education, delinquency rates are likely to keep rising.

“Canadians are clearly feeling the squeeze,” Julie Kuzmic, Senior Compliance Officer of Consumer Advocacy at Equifax Canada said in a statement. “This isn’t just about rising debt — it’s about the shrinking capacity to manage it.”

Sources

1. Equifax: Non-Mortgage Delinquencies Reach Levels Not Seen Since 2009 (May 26, 2025)