Consumers Report Mortgages and Student Loans are Top Forms of Debt

10/11/2016 11:21:00 AM

GoBankingRates’ recent surveys show debt is a top form of financial stress for consumers and varies based on age and income group.


Paying off debt is the top cause of financial stress in the U.S. and recently determined mortgages are the main source of debt for consumers, followed by student loans, credit cards and medical bills.

GoBankingRates conducted a survey on financial stress earlier this year, finding that paying off debt is the top cause of that stress among more than 7,000 respondents. It followed that survey by interviewing nearly 3,000 consumers on the type of debt they have and their loan balances in September.

A majority of respondents, 51 percent, said they are not in debt, according to the results of the recent survey released this week.

“Perhaps this is because some respondents are overlooking certain types of debt they might have, such as small balance accounts or loans in deferment,” said Bruce McClary, vice president of public relations and external affairs for the National Foundation for Credit Counseling in an article from GoBankingRates.

However, many respondents reported carrying various forms of debt that varies depending on their income and age.

Among all respondents, consumers ages 65 and older are the least likely to have debt while those ages 35 to 44 are the most likely to have unpaid bills, according to the survey.

Respondents who earn between $100,000 and $149,999 are more likely to have debt than respondents in other income groups.

Mortgage Debt

About 20 percent of respondents said mortgages are their largest source of debt and the median amount they owe is $59,500. Residents of 42 states said mortgages are their top source of debt and 51 percent of adults ages 35 to 44 report they have a mortgage loan. Respondents to the survey who are ages 35 to 44 have a median mortgage debt of $100,000, the highest among other respondents, according to GoBankingRates.

Mortgages are also the top source of debt for consumers despite the amount of their loan balance.

“For example, Indiana, Ohio and Missouri have some of the lowest median monthly mortgage payments in the nation … yet, they're among the 42 states where residents name mortgage loans as their top source of debt,” GoBankingRates reports.

Student debt

After mortgages, about 13 percent of respondents said student loans are their biggest source of debt with a median amount of $9,100. It is the top source of debt among respondents ages 18 to 34, according to the survey.

GoBankingRates also finds that 36 percent of respondents ages 18 to 24 have student loan debt and owe a median amount of $10,000. Respondents ages 25 to 34 have a median amount of student loans totaling $14,000 and 40 percent of that group owes money for their education.

Generation X, ages 35 to 44, owes a median amount of $15,000 in student loans, according to the survey.

Credit Card Debt  

Credit card debt is the top form of debt for about 10 percent of consumers surveyed by GoBankingRates. Their median balance is $2,000.

Sixty-two percent of respondents, however, said they have no credit card debt.  The consumers with high credit card debt compared to other forms of debt live in Arizona and Wyoming, according to the survey.

Nearly 50 percent of respondents earning between $100,000 and $149,999 have credit card debt and owe a median amount of $6,944. Respondents earning $150,000 or more in income owe a median of $11,750 in credit card bills, according to the survey.

Medical Debt

Only about 6 percent of respondents said medical bills are the biggest source of their debt, according to the survey. The median amount of medical debt for those respondents is $600.

“Although 79 percent of survey respondents report having zero medical debt, it's the top source of debt in more states than credit card debt,” GoBankingRates reports.

The median medical debt for respondents earning up to $24,999 is $1,500. Twenty-seven percent of respondents in that income group have medical debt, according to the survey.

Among respondents ages 35 to 44, they owe a median of $1,367 in medical bills.

Leslie H. Tayne, a financial attorney, told GoBankingRates that consumers, especially those with higher incomes, are making purchases they can't afford by using credit and making monthly payments.

“The more income you have, the more you spend,” Leslie H. Tayne, a financial attorney, told  GoBankingRates. “In fact, Americans of all income brackets have come to rely more and more on credit because it's easy to get, and they have adopted a buy-now-pay-later mindset.”

Debt collectors can assist consumers with developing a plan to pay off their debt in an affordable way. More information for consumers on types of debt and financial management resources are available through Ask Doctor Debt.

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