Racking up unpaid bills:
A study finds that almost 39 percent of Arizonans have debts that have gone to collection agencies. Overall, about 35 percent of Americans have that kind of debt.
tentially hurting credit scores and job prospects, said Caroline Ratcliffe, a senior fellow at the Washington-based think tank.
“Roughly every third person you pass on the street is going to have debt in collections,” Ratcliffe said. “It can tip employers’ hiring decisions, or whether or not you get that apartment.”
The study found that nationwide, 35.1 percent of people with credit records had been reported to collections for debt that averaged $5,178, based on September 2013 records. Among Arizona households, debt in collection aver- aged $6,224.
The debt situation in Arizona, and particularly in the Phoenix metro area, was notably worse than that for the nation as a whole, according to the Urban Institute study, which was based on credit records accumulated by creditbureau TransUnion. The average total debt among Arizona households of $55,831 was nearly $2,000 higher than the national figure. Yet average household incomes were considerably lower in Arizona — $65,788 compared with a national average household income of $72,254. That means Arizonans have less money available to pay down larger obligations.
Arizona’s relatively slow recovery from the recession and more pronounced real-estate boom/bust cycle both appear to be hurting state residents. Arizona households owe $1,981 more than Americans overall, and mortgage obligations represent nearly all of the difference.
One surprising finding was how Phoenix-area residents are struggling more with debt compared with Arizonans generally, despite having higher wages and a greater
See DEBT, Page A15