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States with the highest student loan delinquency rates

Written by:
May 19, 2022
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States with the highest student loan delinquency rates

Student loan debt has plagued college graduates for years, with current U.S. debt levels hitting a record-breaking $1.76 trillion. Nationwide, student loan debt decreased since the start of the pandemic, in part due to economic relief efforts such as the CARES Act. While there was a 2.7% increase in 2021 compared to 2020, this represents the lowest year-over-year increase in the last decade—even with the lengthy pause on federal student loan payments due to the COVID-19 pandemic. President Biden announced another extension for federal student loan borrowers until Aug. 31, 2022, to further provide relief.

Student loan debt plays a huge role in restricting financial freedom. Compared to other generations, more millennials have some form of student loan debt. Although they don't have the highest average debt compared to other generations like Gen Xers or baby boomers, about 14.8 million millennials still had some amount of student loan debt to repay, according to Education Data. It’s been one of the reasons why millennials have held off on big purchases such as buying a home; their aversion to debt precludes them from taking out additional loans, including mortgages.

Sound Dollar ranked the states with the highest percentage of student loan delinquencies using 2021 data from FRBNY Consumer Credit Panel/Equifax. States are sorted based on their proportion of student loan borrowers with accounts 90-plus days past due. The dataset also includes the overall total number of student loan borrowers in each state as well as the average student debt balance for each state. Both federal and private student loans are covered in this dataset.

Of all the states mentioned on this list, 10 out of 13 are located in the Southern region of the U.S. Student loan debt is also the second-highest consumer debt category, with mortgages being first. The Federal Reserve dataset lists the average student debt balance among borrowers across the U.S. as $36,200.

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Arkansas

- Delinquency rate: 9%
- Total number of borrowers: 373,900
- Average student debt balance: $32,400

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Kentucky

- Delinquency rate: 9%
- Total number of borrowers: 586,000
- Average student debt balance: $33,400

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Alabama

- Delinquency rate: 9%
- Total number of borrowers: 614,900
- Average student debt balance: $37,500

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Louisiana

- Delinquency rate: 9%
- Total number of borrowers: 639,300
- Average student debt balance: $35,000

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South Carolina

- Delinquency rate: 9%
- Total number of borrowers: 748,800
- Average student debt balance: $37,200

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Tennessee

- Delinquency rate: 9%
- Total number of borrowers: 867,800
- Average student debt balance: $36,200

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Indiana

- Delinquency rate: 9%
- Total number of borrowers: 926,500
- Average student debt balance: $32,900

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Georgia

- Delinquency rate: 9%
- Total number of borrowers: 1,639,600
- Average student debt balance: $41,600

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West Virginia

- Delinquency rate: 10%
- Total number of borrowers: 215,900
- Average student debt balance: $32,500

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New Mexico

- Delinquency rate: 10%
- Total number of borrowers: 217,700
- Average student debt balance: $34,400

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Nevada

- Delinquency rate: 10%
- Total number of borrowers: 346,200
- Average student debt balance: $35,800

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Oklahoma

- Delinquency rate: 10%
- Total number of borrowers: 474,100
- Average student debt balance: $32,100

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Mississippi

- Delinquency rate: 11%
- Total number of borrowers: 417,600
- Average student debt balance: $37,500

This story originally appeared on Sound Dollar and was produced and distributed in partnership with Stacker Studio.

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