Here’s what happens when you pay only the minimum balance on your credit card
San Luis Obispo County residents carry the highest average personal loan debt of any area in the country, according to a new report by Experian, the consumer credit reporting company.
The San Luis Obispo-Paso Robles-Arroyo Grande metropolitan statistical area ranks No. 1 for the highest average personal loan balance at $46,164 for the fourth quarter of 2018.
Among individual cities, San Luis Obispo ranked No. 9 in the nation with an average personal loan debt balance of $90,395.
After the San Luis Obispo-Paso Robles-Arroyo Grande area, the metropolitan statistical area data included Prescott, Ariz., which averaged $38,959 and Bend, Ore, which averaged $38,390 in personal loan balance.
SLO was also ranked No. 4 in California, coming in behind three communities in the Los Angeles area: Palos Verdes Estates (ranked third at $133,060), Malibu (ranked fourth is $126,968), and La Cañada Flintridge (ranked fifth at $120,862).
The city with the highest personal loan debt was Manhasset, New York, at $232,877.
Personal loans are “a form of secured or unsecured credit that can be used to consolidate debt or finance large purchases,” according to Experian. They are separate from credit card debt, student loans, car loans and leases, and home mortgages.
Nearly 37 million personal loan accounts were held by 10.8 percent of adults in nationwide, the company reported.
Personal loans increased by 16 percent in the fourth quarter of 2018 compared with 2017, and rose by 42 percent compared with the fourth quarter of 2015, Experian reported. The nation hit $291 billion in existing personal loan debt in the fourth quarter of 2018, an 11.9 percent increase from 2017.
“In the past, personal loans were often considered the last option for people trying to escape debt, but that sentiment has changed over the years,” Experian reported. “The change of heart may be due to the fact that Americans are feeling confident about a steady economy amid historically low unemployment rates.”
The surge in loan debt also may be tied to the rise of online lenders and the growth of financial technology, Experian reported.
“Several startups have contributed to the growth and now account for more than 40 percent of all new personal loan originations,” according to Experian data.
Here’s a look at the top 10 metropolitan statistical areas with the highest average personal loan debt:
- San Luis Obispo-Paso Robles-Arroyo Grande, California: $46,164
- Prescott, Arizona: $38,959
- Bend, Oregon: $38,390
- Mount Vernon-Anacortes, Washington: $37,343
- Flagstaff, Arizona: $34,173
- Bremerton-Silverdale, Washington: $33,432
- Bellingham, Washington: $32,672
- Williamsport, Pennsylvania: $32,489
- Wenatchee, Washington: $31,524
- Lake Havasu City-Kingman, Arizona: $31,132
Here’s a look at the top 10 cities with the highest average personal loan debt:
- Manhasset, New York: $232,877
- Syosset, New York: $146,936
- Palos Verdes Estates, California: $133,060
- Malibu, California: $126,968
- La Canada, California: $120,862
- Southlake, Texas: $120,303
- Burr Ridge, Illinois: $107,527
- Mountain Brook, Alabama: $95,026
- San Luis Obispo, California: $90,395
- Princeton, New Jersey: $88,271