Alabama 8th Highest in Household Debt Delinquencies

Alabama ranks 8th highest among states for delinquencies on household debt, according to a study by the online insurance company Fabric Insurance Agency LLC.

The company analyzed statistics from the Federal Reserve Bank of New York, the U.S. Census Bureau, the Bureau of Labor Statistics and Experian and found these debt benchmarks for Alabama:

  • Overall delinquency index: 69.2
  • Auto loan delinquency: 6.2%
  • Credit card delinquency: 7.7%
  • Mortgage delinquency: 1.0%
  • Student loan delinquency: 15.2%
  • Average credit score: 654
  • Poverty rate: 15.0%
  • Household debt per capita: $36,780

To identify the states with the biggest debt problem, said the study’s analysts, a composite index (from 0 to 100) was calculated based on the four different delinquency rates listed — auto loans, credit cards, mortgages and student loans. For the purpose of this analysis, “delinquency rate” is the percentage of total debt that is 90+ days delinquent. An index of 0 indicates that the state has the lowest delinquency rates across the four loan types among all states, and an index of 100 indicates that the state has the highest delinquency rates among all states.

Household debt in the U.S. is the highest it has ever been, reported Fabric’s online story. According to the New York Fed, total household debt reached $13.67 trillion in the first quarter of 2019, an increase of 0.9% from the fourth quarter of 2018 and nearly $1 trillion above its previous peak in 2008.

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In the Fabric study, statistics on delinquencies and per capita household debt are from the Federal Reserve Bank of New York Q4 2018 Quarterly Report on Household Debt and Credit. Poverty rates are from the U.S. Census Bureau Current Population Survey. Unemployment rates are from the U.S. Bureau of Labor Statistics 2018 Local Area Unemployment Statistics. Credit scores are from the Experian 2017 State of Credit.

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