35% of Americans are in Debt to Collection Agencies

Tuesday, August 05, 2014
(graphic: Steve Straehley, AllGov)

More than a third of all adults in the United States find themselves dealing with collections agencies as a result of falling seriously behind on their debts.

 

It is estimated that 35% of Americans nationwide are in collections, according to Delinquent Debt in America, a new report from the Urban Institute. Debts in collection can include medical bills and traffic fines, as well as consumer credit accounts.

 

In some states, nearly half of those with credit files are being hounded by debt collectors. Nevada, “which was hard hit by the housing crisis,” the report says, has a 47% rate, the highest in the country.

 

A dozen states, including 11 in the South, as well as the District of Columbia, are above 40%: Alabama, Arkansas, Florida, Georgia, Kentucky, Louisiana, Mississippi, New Mexico, North Carolina, South Carolina, Texas, and West Virginia. At the other end are Minnesota, North Dakota, and South Dakota, which have the lowest rate of people in collections, about 20%.

 

Looking at the numbers of what people owe, it isn’t a shock to learn that so many Americans are so far behind on paying their credit cards, mortgages and other debts.

Nerd Wallet reported these sobering figures for the U.S. in April:

 

Average per household credit card debt: $15,191

Average per household mortgage debt: $154,365

Average per household student loan debt: $33,607

 

At any one time, about 5% of the population has a non-mortgage bill such as a credit card account, car loan or student loan that’s more than 30 days past due.

-Noel Brinkerhoff

 

To Learn More:

Delinquent Debt in America (Urban Institute) (pdf)

American Household Credit Card Debt Statistics: 2014 (by Tim Chen, Nerd Wallet)

Debt Collection Complaints by Military Members and Veterans Skyrocket (by Noel Brinkerhoff, AllGov)

Largest Debt Collector Gets away with Minor Fine for Harassing Citizens (by Matt Bewig, AllGov)

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