New analysis of credit health, bankruptcy trends, and “debt/loan” search interest shows several states where household finances are under acute pressure.
Florida recently jumped to No. 2, but the problem stretches well beyond the Sunshine State. Here’s a concise state-by-state tour of the 10 most financially distressed places in America—and the main forces driving the squeeze.
Texas
- Rank: #1
- Key stat(s): ~22% YoY rise in non‑business bankruptcies; ~7.1% share of residents with distressed accounts; among the lowest average credit scores.
Texas tops the list despite its massive economy. Wallet-level stress shows up in low average credit scores, a fast rise in bankruptcy filings, and heavy search interest for “debt” and “loans.” Housing and insurance costs, plus rapid population growth, add to monthly pressure for many households.
Florida
- Rank: #2
- Key stat(s): ~23% YoY jump in the share of residents with distressed accounts; ~7.3% overall share in distress.
Florida’s no‑income‑tax allure collides with soaring housing and home‑insurance costs. The state posted one of the nation’s sharpest increases in financially distressed accounts, reflecting rising balances and higher delinquencies, especially in coastal metros vulnerable to storms and premium spikes.
Louisiana
- Rank: #3
- Key stat(s): Among the lowest credit scores nationally; highest share of accounts in forbearance/deferred (~11–12%).
Lower credit scores and a very high share of accounts in forbearance signal widespread strain. Disaster risk, elevated insurance costs, and slower wage growth in many parishes amplify repayment challenges.
Nevada
- Rank: #4
- Key stat(s): Low average credit scores; one of the largest recent spikes in bankruptcy filings.
Nevada’s tourism-driven economy can be volatile for household budgets. High housing costs in Las Vegas and elevated credit utilization rates leave many residents vulnerable when hours drop or tips thin out.
South Carolina
- Rank: #5
- Key stat(s): Elevated share of distressed accounts; high search interest for loans.
Rapid in‑migration and housing inflation have outpaced incomes in key metros. Add rising insurance and medical costs, and more households are resorting to forbearance or short‑term borrowing to bridge gaps.
Oklahoma
- Rank: #6
- Key stat(s): Below‑average credit scores; elevated “loans” search interest.
Even with a relatively low cost of living, Oklahoma households show signs of debt stress. Fluctuations in energy‑adjacent employment and medical debt exposure contribute to more accounts slipping into hardship status.
North Carolina
- Rank: #7
- Key stat(s): Rising share of distressed accounts; several large metros rank high for financial strain.
Growth hubs like Charlotte and the Triangle are booming, but higher housing and consumer‑debt loads have climbed alongside. City‑level rankings show notable pockets of distress despite strong job markets.
Mississippi
- Rank: #8
- Key stat(s): Among the lowest credit‑score averages; persistent poverty rates.
Mississippi’s longstanding income and health‑care challenges translate into thinner financial cushions. When costs rise—rent, utilities, car insurance—more households miss payments and enter forbearance.
Kentucky
- Rank: #9
- Key stat(s): 6th‑lowest average credit score; double‑digit rise in the share of residents with distressed accounts.
Kentucky’s rankings reflect broader strain: lower credit scores, more accounts falling behind, and elevated search interest in loans. Household budgets are being pinched by essentials—housing, autos, and medical bills.
Alabama
- Rank: #10
- Key stat(s): Bottom‑tier credit scores; high medical‑debt burden in many counties.
Relatively modest wages and health‑care costs push more Alabamians toward deferrals and forbearance. When unexpected bills arrive, limited savings buffers make it harder to stay current on multiple accounts.
Predicting what comes next
Economists warn that if interest rates remain elevated and insurance and housing costs continue to climb, more states could join this list by 2026. Credit card delinquencies, already at their highest in over a decade, suggest that the problem may spread beyond today’s most distressed states.
