Cities with the Most Collection Accounts

When someone misses payments on a line of credit or a loan for an extended period of time, the creditor may sell it to a debt collection agency. This allows the original lender to recoup some of the money immediately and gives the collection agency the authority to get the debt from the borrower. Having an account in collections can wreak havoc on your credit score and stay on your credit report for up to seven years.

To identify the cities where people have the most collection accounts, and consequently where people are having the most financial difficulty, WalletHub compared 100 cities based on four key metrics, including the average number of collection accounts and the average balance, as well as the change in those values between Q1 2024 and Q2 2024.

“If you have an account in collections, it’s important to immediately come up with a plan to handle it. For example, you might create an extremely strict budget and set aside money every month for paying off the debt. Alternatively, you might settle with the collection agency, work with them to create a debt management plan, or wait out the statute of limitations if you’re close to it and have not made any payments. You should also familiarize yourself with what debt collectors are and aren’t legally allowed to do, so you can report any bad behavior.”

CASSANDRA HAPPE, WALLETHUB ANALYST

To read more and view the list of cities, click here