One in four Tennesseans have delinquent debts, analysis finds

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One in four Tennesseans carry delinquent debt, a figure that jumps to 41% in the state’s communities of color, a recent analysis of the nation’s debtors by The Urban Institute finds.

Nationally, 23% of white Americans and 29% of Black and other minorities have struggled to pay back car, credit card, student loan and medical bills that then fell into delinquency.

The rate of unpaid debt in Tennessee, like the majority of the Southeast, outpaces U.S. averages. Delinquent debts trail individuals for years, limiting their ability to secure new loans for homes and cars, rent apartments and pay for everyday living expenses.

The “Debt In America” analysis by the Washington, D.C. based think tank relies on a sample of 2023 consumer data from credit reporting bureaus and Census estimates.

Seven percent of Tennessee’s white residents hold medical debt, compared to 10% of minority residents; 5% of white residents have delinquent auto loans, a rate that doubles among communities of color; and the median credit card debt for the state’s white residents is $599 versus $485 for minority residents.

Student loan debt defaults overall hover at 1% for Tennessee’s white residents versus 2% for communities of color. Among young people aged 18 to 24, rates of student debt delinquencies shoot up to 14% for white residents and 21% for Black, Asian and other minorities.

Williamson County – with a median income of $175,000, the state’s wealthiest county – has the lowest share of residents with debt in collections: just 8%. Haywood and Lauderdale, largely rural counties in west Tennessee just north of Memphis, have the highest: about four in every ten residents of these counties are delinquent on their loans or medical bills..

The analysis, which includes interactive maps that illustrate delinquency debts in each county, defines delinquencies to include both unpaid bills in collection and past-due credit lines that have been closed and charged off.