With little or no affordable housing, a plethora of low-paying jobs and soaring health spending, It should come as no surprise to anyone that Floridians are drowning in debt.
Financial planning firm Fabric recently released a full ranking among states in the country with the most outstanding debt, and Florida narrowly missed the podium, ranking fourth among the worst states.
The study, which analyzed statistics from the Federal Reserve Bank of New York, the US Census Bureau, and the Bureau of Labor Statistics, considered four different types of loans: auto, student, credit cards, and mortgages. The study showed that Florida has an automatic credit default rate of 5.3%, a credit card default rate of 9.7%, a mortgage default rate of 1.6%, and a mortgage default rate of whopping 13.7% student loan default, which is significantly higher than the national average of 11.4%, according to Forbes.
Overall, Florida had a debt default index of 83. For comparison, Mississippi ranked as the worst state for debt, with a default index of 100.
Florida’s high delinquency rate correlates directly with the state’s economic health, as well as local lending and borrowing practices, according to Fabric. With a poverty rate of 13.7%, higher than national average 12.3%, Florida’s low-income population is ultimately more susceptible to delinquency on loans.
A 2018 article from Tampa bay times explained the dangers of predatory loans aimed at low-income people, who ultimately often depend on payday loans to survive.
“Floridians, mainly in poor neighborhoods, took out 7.7 million 12-month payday loans in 2016 and 2017,” the article read. “And nearly a third of all customers took at least 12 loans that year, a clear sign of the ‘debt trap’ lenders are enjoying, critics say.”
And, Florida is particularly fucked up in this category. Currently, more than half of college students in Florida graduate with an average loan debt of $ 24,461, according to a 2016 study by the Institute for Access and success in college.
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