Across the country, roughly one in four Americans with a credit record now find themselves behind on what they owe, a quiet strain that a nonpartisan analysis from the Urban Institute has traced through medical bills, student loans, and car or store debt. It is a story about the long pressure of living costs that have climbed steadily since 2019, leaving many households to draw down savings and borrow for the everyday. The burden falls unevenly, weighing heaviest on communities of color and on regions where incomes are lower, and it deepens as interest rates rise in the effort to tame inflatio
One in Four Americans With a Credit Record Is Behind on Debt, Urban Institute Finds
Millions of Americans with credit records are behind on payments, with many households described as at a 'breaking point' under high living costs.
The debt doesn't disappear. It just isn't reported anymore.
Mark
One in four people with a credit record is behind. Why does that number land so hard?
Mimi
Because it's not one kind of debt. Medical bills, student loans, car loans, store credit, all of it. The median owed is $2,913, which isn't enormous, but it's a lot for someone already stretched.
Mark
The rate is higher in communities of color, right?
Mimi
30% are behind, with a median of $3,009 in collection. Braga linked the broader pattern to lower incomes, higher poverty and lower credit scores that mean higher interest rates.
Luke
Careful with the trend, though. The rise is about one percentage point, from under 23% last year. That's real, but it's modest.
Mark
And the credit card figure?
Mimi
A record $1.29 trillion from the New York Fed, up nearly 70% in five years.
Luke
That's a total balance, not a delinquency measure. It shows borrowing, not necessarily people falling behind. Also, Rossman's line that budgets are at a breaking point is one analyst's assessment, not a measured finding.
Mark
What about medical debt?
Mimi
Only 3% have it in collections, median $1,492, and that excludes health costs put on credit cards. Insurance doesn't shield people, especially with high deductibles.
Luke
And the fifteen states that bar reporting? The source doesn't say how much that has changed anyone's credit, only Braga's point that the debt still exists. We don't know the effect size.
El Pulso
- About 24% of people with a credit record are behind on payments, and the median balance owed sits at $2,913.
- In communities of color, delinquency reaches 30%, a gap that marks the strain as deeply unequal.
- Credit card balances have hit a record $1.29 trillion, nearly 70% higher than five years ago, as households lean on debt for daily needs.
- Rising interest rates, introduced to cool inflation, threaten to make catching up harder for families already at a breaking point.
- Fifteen states now bar medical debt from being reported to credit agencies, shielding credit records even as the debts themselves remain.
Across the country, roughly one in four Americans with a credit record now find themselves behind on what they owe, a quiet strain that a nonpartisan analysis from the Urban Institute has traced through medical bills, student loans, and car or store debt. It is a story about the long pressure of living costs that have climbed steadily since 2019, leaving many households to draw down savings and borrow for the everyday. The burden falls unevenly, weighing heaviest on communities of color and on regions where incomes are lower, and it deepens as interest rates rise in the effort to tame inflation. Whether families can climb back out from under these balances may depend on what prices and borrowing costs do next.
About a quarter of Americans with a credit record are behind on payments for medical bills, student loans, car loans, or retail debt, according to a new analysis from the Urban Institute. The median amount owed is $2,913, and the share of people with debt in collection has risen about a point this year. The numbers reflect a financial squeeze that analysts say is tied to rising living costs, which the institute's Breno Braga describes as a reflection of how Americans are living right now.
The strain is not shared equally. In communities of color, 30% of people are behind, and the median debt in collection there is $3,009. Student loan delinquency runs near 16% nationally but reaches about 22% in Louisiana, where incomes are lower and poverty higher. Lower credit scores in such places mean higher interest rates, which makes falling behind more likely.
Other signals point the same direction. Credit card balances have reached a record $1.29 trillion, and consumer prices have risen an average of 30% since 2019. Ted Rossman of Money Management International says many households have drained savings and turned to debt for daily expenses, and that many budgets are at a breaking point.
Medical debt affects a smaller share, about 3%, but its burden is stubborn. Braga notes that insurance offers little real protection, especially with high-deductible plans now common. Fifteen states have stopped providers from reporting medical debt to credit agencies, a relief for patients, though the debt itself remains unpaid. What comes next depends on whether interest rates keep climbing while prices stay high.
About 24% of Americans who have a credit record are behind on what they owe, according to a new analysis from the Urban Institute, a nonpartisan think tank. The debts in question are medical bills, student loans, and auto or retail loans. The median amount owed is $2,913.
The burden is not spread evenly. In communities of color, 30% of people are behind on payments, and the median debt in collection there is $3,009. The Urban Institute built its findings from more than 10 million credit records combined with U.S. Census data. It found the share of Americans with debt in collection is up about one percentage point this year, from under 23% in 2025.
Breno Braga, a senior fellow in the institute's family and financial well-being division, told CBS News that rising living costs are making it harder for people to pay for basic needs. Higher interest rates this year, as the Federal Reserve works to bring down inflation, are making it harder still for people to catch up. He described the numbers as a reflection of the financial life of Americans these days.
Other figures point the same way. New data from the Federal Reserve Bank of New York show consumer credit card balances at a record $1.29 trillion, up nearly 70% from five years ago. Ted Rossman, principal consumer finance analyst at Money Management International, a nonprofit debt counselor, said years of high prices have pushed Americans to drain their savings and use debt to cover daily expenses. He told CBS News in an email that many household budgets are at a breaking point. Consumer prices, he noted, have climbed an average of 30% since 2019.
Student loans show how much geography matters. Roughly one in six borrowers, almost 16%, is behind on payments. In Louisiana, the state with the highest share of residents with debt in collections, the student loan delinquency rate is about 22%. Braga pointed to lower incomes and higher poverty rates in parts of the country. People in those places tend to have lower credit scores, he said, so they pay higher interest rates on credit cards and auto loans, which makes falling behind more likely, especially for those on low incomes.
Medical debt is a smaller slice but a stubborn one. The Urban Institute found 3% of Americans have medical debt in collections, with a median balance of $1,492. That figure counts only unpaid hospital or other medical bills, and leaves out credit card debt that came from health care costs. Braga noted that being uninsured raises the likelihood of medical debt, but insurance offers no real protection, particularly with the high-deductible plans now common.
Fifteen states have passed laws barring health care providers from reporting medical debt to credit rating agencies, which can limit damage to people's credit records. Braga called that good for patients but cautioned that the debt does not disappear; it simply goes unreported.
What to watch next is whether interest rates keep rising while prices stay elevated, since both are cited as obstacles for households already behind.
Citas Notables
The increasing cost of living makes it harder for people to make payments on basic needs.— Breno Braga, senior fellow, Urban Institute
Many household budgets are at a breaking point.— Ted Rossman, Money Management International (paraphrased from email)
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