A new report from the Urban Institute gives us a better idea of how many Americans are struggling with debt. An astounding 77 million people have debt in collections and another 12 million have bills past due.
The group looked at TransUnion data from 2013. This information does not include low-income Americans who have no credit reports on file. It also doesn’t include payday loans, pawnshop loans or loans from family and friends. But it does give an important snapshot of consumer debt.
Nationally, the share of people with non-mortgage debt past due is 5 percent. This means they have bills at least 30 days late. The average amount they need to pay to become current is $2,258. People in Louisiana, Texas and Mississippi are more likely to have debt past due.
Nationally, the share of people with debt in collections is 35 percent. This means they failed to pay a bill. Debt in collections can include medical bills, parking tickets, membership dues and more. The failure to pay stays on a credit report for seven years. Some people may not realize they have debt in collections. The average size of a person’s debt in collections is $5,178. Nevada tops the list of past-due states, followed by states in the South.
Rochesterians’ debt is slightly better than the national picture, with 5 percent of people having debt past due and 28.8 percent of people having debt in collections. The average amount of debt in collections is $4,839.
Why do we care? The Urban Institute points out:
In addition to creating difficulties today, delinquent debt can lower credit scores and result in serious future consequences. Credit scores are used to determine eligibility for jobs, access to rental housing and mortgages, insurance premiums, and access to (and the price of) credit in general (Federal Trade Commission 2013; Traub 2013).
High levels of delinquent debt and its associated consequences, such as limited access to traditional credit, can harm both families and the communities in which they live.
The Wall Street Journal notes, however, that the share of people in collections has remained steady over the last decade and Americans are making progress on reducing their debt.
Links of the Day:
– The Washington Post visits Syracuse, the Upstate city finding itself in the middle of the uproar over immigrant children.
– New York Magazine explains to the rest of the world why we hate Bon Jovi. “You might as well just take this city, throw it in the river, and let it go down Niagara Falls,” said Andre Reed of the possibility Bon Jovi could buy the Bills.
– Wegmans has no plans to expand outside of the Northeast.
– Private overtime should not be calculated into officers’ pensions.
– “Even in New York, it’s difficult to justify relocation incentives for a TV show that’s already here.”
– “It’s not his commission anymore than it’s his governor’s mansion, anymore than it’s his state.”
– Fifteen weird and creepy facts about Rochester.
Tweets of the Day:
— RGRTA (@RGRTA) July 29, 2014
Bikes otpional but brews are mandatory. Come learn more about biking in Rochester and enjoy some great beer. pic.twitter.com/VQBGApAXIz
— Roc Brewing Co., LLC (@RocBrewingCo) July 29, 2014