Determines which states in the country make it easier for those living with bad credit, and those which make it more challenging.
New York, N.Y. – Many Americans are living with bad credit. There are certain locations that make living with bad credit easier, and then there are some that make it more difficult. RewardExpert – a free service that helps users take full advantage of credit card and travel rewards – today released its ranking of The Best and Worst States to Live in with Bad Credit, based on an analysis of five factors; life expenses, consumer friendliness of usury laws, status of debt collectors, state financial health, and complaints per capita.
“We’ve all heard of credit horror stories. Your credit score can impact your financial health for many years,” says RewardExpert CEO and co-founder, Roman Shteyn. “Plenty of people will be looking at those credit scores, particularly when considering a candidate’s loan worthiness. A 0.5% rise in a mortgage rate may not seem like much on paper, but after decades of accrued interest, it can really cost you in the long run. However, some places in the country are simply more forgiving than others for folks living with bad credit.”
The top three best places to live in with bad credit are:
- Iowa – With fines of more than $10,000 for Unfair and Deceptive Acts or Practices violations and one of the lowest usury rates in the country, and with a maximum interest rate of just 5.0%, the Hawkeye State is the best place in the country to live without good credit.
- Minnesota – Of all fifty states, Minnesota has the absolute lowest delinquency rate. With median income levels about 15% higher than average, Minnesota’s economy is strong enough to allow debtors to earn enough to pay back their loans. Also, mortgage rates are below average and so are prices.
- Nebraska – Nebraska is an extremely financially healthy state. With unemployment sitting at 2.7%, versus the 4.1% national average, and jobs paying well, if you have bad credit, you’re more likely to have the job and the money to pay back the higher interest rate in Nebraska than in most places in the country.
The three worst states to live in with bad credit are:
- Washington – Prices in Washington state are sky high. In-demand real estate and schools are making mortgages and school loans extremely expensive, especially for those with credit scores on the lower end. Even worse, legal usury rates are 1.5 times the national average.
- Tennessee – Just about everything about the state makes Tennessee a tough place for people with bad credit. The Volunteer State ranks in the bottom half of all but one category analyzed in the report and it serves up a maximum legal interest rate in the double digits.
- South Carolina – Home and tuition prices are high, at 41st and 43rd in the country. Judgment loan rates are capped relatively well, at 12.75%, but South Carolina is pretty easy on payday and predatory lenders and the 8.75% maximum legal interest rate is above average – neither of which are doing those with low credit any favors.
“There’s a lot you can do to improve your credit score, such as becoming an authorized user on a family member’s account, increasing your credit limit, and correcting for any inaccuracies in your credit history,” says Shteyn. “However, very few improvements can be made overnight. Be aware of what restrictions and policies are enacted in your state that can help or hinder you on your journey towards financial wellness.”
RewardExpert gathered data from a number of sources, including the Census, the Bureau of Labor Statistics, the Federal Housing Finance Agency and dozens more to determine a state’s viability for those with low credit.
For further information and to view the full report, visit the RewardExpert website.
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