Maine Debt Relief

In a Nutshell

Maine is located in the northeastern New England region and is famous for its lobsters, rocky coastline, and participation in the Revolutionary War. This state is also famous for its high cost of living, exceeding the national average by 1.05 times and ranking as the 16th most expensive state to live in.

As a result, residents of the Pine Tree State can easily fall into debt as they try to meet high living costs. In this article, we’ll discuss Maine’s debt relief options, the various types of debt to get relief from in the state, as well as key financial hardship resources.

Maine's Economic Picture

Maine’s GDP grew to $62.7 billion in 2022. The gross state product growth rate is 1.21%, overperforming the national average rate of 0.19% over the same time period. The leading industries in terms of revenue include Life Insurance and annuities, contributing $10.5 billion; hospitals, $8.4 billion; and gas stations with convenience stores, totaling $6.1 billion.

The largest employment sectors are the state of Maine, with 30,000 employees and a 4.5% growth rate; Maine Health Services, with 20,751 employees and a growth rate of 3.1%; and Hannaford Bros. Co., LLC, with 8,751 employees and a growth rate of 1.3%.

How Does Debt Relief Work in Maine?

Maine debt relief involves finding different solutions that aim to achieve financial freedom. These solutions are administered with the help of non-profit organizations, debt relief companies, and state and federally-funded agencies.

These entities negotiate with lenders and debt collectors for reduced interest rates, lower monthly payments, waived penalty fees, and debt reduction or forgiveness. All these efforts help you get a fresh start away from debt.

Maine Debt and Financial Statistics

The following debt and other financial statistics are specific to the state of Maine:

Average Consumer Debt

The average consumer debt in Maine is $87,920. Some attribute this to the overall increase in personal debts resulting from high interest rates and cost of living increases that have outpaced wages.

Credit Card Debt

Maine residents carry an average credit card debt of $4,913, well below the national average of $5,589. 

The nation as a whole carries a staggering $1.13 trillion in credit card debt, with Maine residents struggling to keep up with higher annual percentage rates (APRs) from credit card companies.

Auto Loan Debt       

The U.S. experienced an increase in personal and commercial automobile ownership rates of 3.66% from 2017 to 2021, with 91.7% of households owning at least one vehicle to drive and 93.2% of households in Maine having access to at least one car. This suggests an uptrend in the car market despite increased car prices exacerbated by supply chain constraints for parts and a lack of new and used car inventories.

Auto loan borrowers in Maine have an average auto loan balance of $18,824. This average amount represents a 7.8% jump in auto loan debt from the previous year’s average.

Mortgage Debt

Nationally, mortgages were the biggest contributor to consumer debt, as they increased by nearly $1 trillion in 2022.

Maine residents have encountered the same phenomenon, as home values increased exponentially while interest rates continue to rise. In May of 2023, the average Maine home value sat at $373,241.

Student Loan Debt

About 33.6% of Maine residents have graduated with a bachelor's degree or higher. Out of this, 187,100 of them are student loan borrowers with an average student loan debt of $33,137.

The total student loan debt owed by the residents of Maine is $6.2 billion, with 55.5% of these borrowers under 35 years old.

Household Debt

Household debt in the U.S. increased by $228 billion in Q3 of 2023 as young debtors struggled with auto loan and credit card payments in America.

Maine’s residents also witnessed a shift in household debt as they maintained an average debt-to-income (DTI) ratio of 1.627 as of Q2 2023. Such a DTI implies that, for every $1.00 in income, Maine residents owe $1.62 in debt. This often results in a never-ending cycle that takes debt relief assistance to break.

Bankruptcy

Bankruptcy filings in the state have been on a 10-year downward trend since 2010, with just 534 cases filed in 2022.

Chapter 7 bankruptcy filings were the highest at 409 cases. This highlights the need for debt relief as residents who file for Chapter 7 often have a low income with large unsecured debt balances that need to be discharged once nonexempt properties are liquidated to pay off debt.

In 2022, Maine recorded just 108 Chapter 13 filings. Residents with an income above the median income typically file Chapter 13 bankruptcy. Consumers filing for Chapter 13 are required to submit a repayment plan to be approved by the court and are typically able to keep almost all of their assets, as liquidation isn’t necessary.

The remaining 17 cases were from Chapter 11 bankruptcies, which are used by business entities.

Average Income and Employment

Maine has a population of 1.38 million residents and an employment-to-population ratio of 56.3%, which means that for every 100 Maine residents, just over 56 are employed in part-time or full-time positions. This ratio is often referred to as the “labor force participation” ratio. Maine’s figure is below the national average labor force participation ratio of 60.2%.

Another bright note in Maine's workforce is that unemployment remains low, at 2.4% as of May 2023.

The median household income in the Pine Tree State is $63,182 per year, while the state’s income per capita is $36,171. In Maine, 11.5% of residents live in poverty.

Credit Scores

Your FICO score is crucial in determining credit scores, creditworthiness, and the cost of accessing loans. The average FICO score in Maine increased by 3 points to 731 in 2023, indicating that even through the pandemic, consumers found alternative ways to manage their debts.

Generally, 731 is quite a good credit score for accessing lower-interest loans. With the national average FICO score at 715 at the end of Q3 2023, this is a strong showing for Maine residents.

Identity Theft

Since the onset of the pandemic, identity theft reports in Maine increased by 85.39%, ranking it 4th highest in the country in terms of growth.

However, the number of identity thefts in the state still remained low at 167 cases per 100K residents ranking the state 39th countrywide.

Banking and Tax Info

There are currently 23 banking institutions in Maine with total assets worth over $41 billion. The largest financial market is in Portland, with total deposits topping $20 billion.

Maine’s graduated individual state income tax ranges from 5.8% to 7.15%, while the corporate income tax rate ranges from 3.5% to 8.93%. The state’s sales tax rate is 5.5%, and residents aren’t burdened with a local sales tax.

An excise tax is levied on cigarettes and gasoline at thirty cents per gallon of gasoline and $2 per 20 packs of cigarettes. The property tax rate in the state is 1.24% of the owner’s assessed home value. Property owners in Maine enjoy a property tax valuation exemption on the first $25,000 in assessed market value of their homes, thanks to the state’s Homestead Exemption, provided the owner meets certain qualifiers.

TurboDebt Helped Maine Residents Overcome Debt in 2023

TurboDebt is a reputable debt relief company that helps Maine residents qualify for debt relief options. In 2023, we worked with 620 clients, enrolling 188 in our debt relief program, saving them an average of over 51% on their debts. The total enrolled debt was $4,570,822, and the average client enrolled debt was $24,313.

Top Types of Debt To Get Relief From In Maine

While TurboDebt accepts many forms of unsecured debts, we often work with Maine residents carrying the following types of debt:

Credit Card Debt

Credit card debt is an unsecured debt that carries high interest, service fees, and substantial late charges if you miss a payment by just one day, making it difficult to clear this kind of debt. With an average credit card debt of over $4,000, many Maine residents find themselves in a hard place financially and have to seek help from a certified debt relief company to escape debts from credit card accounts.

TurboDebt has received thousands of positive reviews from clients who are now debt-free. We offer debt relief solutions to residents of Maine who are struggling with heavy financial burdens. Contact us today for a free consultation with our professional team.

Divorce Debt

Since Maine isn’t a community property state, debts and assets aren’t necessarily divided equally when a marriage is dissolved. However, that doesn’t mean you won’t end up with divorce debt. A divorce judge may decide to divide your marital debt based on income or custody of children, resulting in divorce debt.

You can also accumulate divorce debt from hefty legal fees and alimony. If you find yourself in such a situation, you can benefit from Maine’s debt relief options to clear your divorce debt or get financial assistance from the state’s resource programs to ease the financial burden of divorce.

Business Debt

A high corporate income tax in Maine makes it harder for small businesses to consistently generate profits and realize their ROIs. For small business owners, this can become a tough situation when they’ve got limited capital that’s being eaten up quickly by the overhead costs of doing business. Many of them end up securing short-term, higher-interest business loans, which results in debt that is difficult to clear once it takes hold of a business’s balance sheet.

Instead of winding down your business operations and potentially laying off employees, consider getting reputable help from TurboDebt’s relief program and strategic planning services.

Medical Debt

In Maine, 7.3% of residents lack medical insurance despite the state's MaineCare program, which helps Pine Staters find access to medical insurance coverage. The program is designed to assist residents with low incomes, disabilities (or those living with someone with a disability), blindness, those who are younger than 18 and pregnant, and anyone above 65 years old.

Such a financial situation has led to residents owing a mean medical bill balance of $3,035. Of this amount, 16.94% is in collections. This often leads to limited access to quality medical care and increased medical bills for financially struggling residents with chronic illnesses or lack of insurance coverage.

Maine medical debt relief plans can assist you in clearing your outstanding balances and ease access to quality medical care.

Homeowner Debt

Due to the difference in mortgage prices and income, most homeowners in Maine need to catch up on their average monthly mortgage payments. This financial situation is tougher in Portland, where the average home values have soared to $520,352 in the past year, resulting in high interest rates for new homeowners.  

TurboDebt's Maine debt relief program is here to help ensure that you overcome any foreclosure risks.

Retirement Debt

Retirees who want to retire and enjoy Maine’s beautiful coastline and expansive forests need around $1.01 million to do so comfortably. Although this is 3.2% below the national average, it can still be very difficult to accumulate the funds needed for a comfortable retirement, and for many retirees in Maine, this means living on a very tight, fixed income.

Whether you’re working with certified credit counselors or our own TurboDebt experts, know that there’s a debt management plan to help Maine residents get rid of retirement debt.

Maine Debt Relief Options

Residents looking to discharge outstanding balances can benefit from the following effective debt relief solutions in the state:

Debt Management Programs

Debt management programs (DMPs) are facilitated by nonprofit credit counselors who help you eliminate unsecured debt like credit cards. They assist you in creating a debt management plan based on your income and the amount you owe creditors.

For DMPs to work, you typically close your existing credit cards and commit to making monthly payments to a savings account. Creditors will be paid off from the savings account in three to five years under this debt relief option.

Debt Consolidation Loans

Debt consolidation loans involve taking a larger lower-interest-rate loan to pay off your smaller loans. This debt relief solution effecitvely “refinances” your debts into a single payment, as it eliminates the multiple high-interest balances and potential late fees you could have paid if you didn’t consolidate your loans.

You can also benefit from lower monthly payments as a result of lower interest rates from your consolidation loan. Some debt consolidation loans offer a 0% interest rate for a limited timeframe. This debt relief option works best for residents with a “good” credit score of 680+ in order to qualify for them.

Debt Settlement

Debt settlement plans are debt relief options that offer creditors an alternative to the likelihood of borrowers defaulting on their loans. In this debt relief solution, third-party debt relief companies negotiate for a reduction in the balance on your loan.

Once you enroll in a debt settlement program, you'll stop paying your lenders and instead provide a monthly payment to the settlement company. After you've saved enough, the debt relief organization then negotiates with your creditors, saving you up to 50% of what you owe.

Debt settlement companies do charge fees for negotiating and administering your account based on the total debt you enroll. However, you can often use this option to become debt-free in as little as 24 months.

Credit Counseling

Credit counseling allows you to take control of your financial lifestyle by empowering you with debt and money management tools, budgeting techniques, and financial education materials.

You'll work with a certified credit counselor who can help you determine a debt management plan based on your income and expenses. Certified credit counselors can also help you understand your credit report, as you gain access to the data for free when you work with a credit counseling agency.

Maine residents with extremely low incomes who are in tight financial situations can access this debt relief option from nonprofit credit counselors, often at little to no cost.

Bankruptcy

Debtors and financial experts often dislike this debt relief option as it negatively impacts your credit report for up to 10 years, limiting your access to loans in the future. However, depending on the type of bankruptcy your law firm files on your behalf, it can discharge or reorganize your debt payments.

Chapter 7 bankruptcies will liquidate your nonexempt properties to repay your lenders. Debts that aren’t cleared through liquidation are often discharged by the time your bankruptcy case is finished, allowing you to get a fresh start.

In Chapter 13 bankruptcies, debts are reorganized, and a repayment plan is developed that must be approved by the bankruptcy court.   By reorganizing, you are often allowed to fully repay your debts in just three to five years. This option is for individuals earning a consistent monthly income who can afford to clear their debts without liquidating their assets.

Debt Forgiveness

Debt forgiveness entails debt cancellation once you enroll in one of several available debt forgiveness programs based on your job or the geographical area in which you work. Most debt forgiveness programs are administered by state and federal governments, including student loan debt forgiveness programs.

Certain professions also qualify for debt forgiveness. For example, teachers who meet certain qualifications can earn forgiveness on their student loans after a certain period of time making payments.

Find the Best Debt Relief Services

Brad Reichert, a debt expert and the founder and managing director of Reichert Asset Management, offers his advice to consumers looking for help. 

“Because of its already tight regulations on financial firms like insurance and investment companies due to the substantial number of firms doing business there, Maine imposes high standards on firms that operate in the consumer credit and debt remediation industry,” Reichert explains.

“For instance, all debt management and debt relief service providers looking to do business in the state of Maine must register and apply for a license via the Nationwide Multistate Licensing System (NMLS) before doing business in the state,” he says.

Debt and Financial Hardship Resources

The following debt and financial assistance resources are here to assist Maine residents in avoiding the harsh effects of financial hardships:

Temporary Assistance Programs

TANF is a cash assistance program for eligible working families and pregnant women. Once you join the program, you may qualify for job training and education.

The General Assistance fund provides residents who can’t meet their basic needs with cash assistance, including paying for household supplies, medical bills, housing debts, and utility costs.

Higher Opportunity for Pathways to Employment (HOPE) is an educational training program for families that meet the financial requirements and social qualifications.

State Health and Human Services

The SNAP program provides low-income families and residents with monthly stipends to purchase nutritious food, thus avoiding potential malnutrition.

The SNAP Employment and Training initiative assists SNAP beneficiaries with job training and education so that they find and maintain well-paying jobs.

MaineCare offers free or low-cost medical insurance to residents who meet the program’s financial requirements.  

Maine's Disability Determination Services provide medical assistance to qualifying disabled residents.

Child Care

Maine offers the Child Care Subsidy Program to help low-income families who need support for children while they work or attend school.

Child support services help lost children in Maine locate their parents and discover who their parents are through paternity/maternity tests. The program also enforces other child support obligations.

Shelters for the Homeless

Emergency Shelters in Maine are supported with funds from the state government to avoid homelessness due to foreclosures or any financial hardship.

Free Transportation Services

The Go Maine Commuter Connections service offers residents free transportation within the state.

MaineCare Transportation Services also offers non-emergency transportation services to eligible residents.

Find Debt Relief in Maine

You can become debt-free with the many options offered to Maine residents. Your biggest task before enrolling in a debt management program is ensuring that the debt relief company is reputable and carries the proper accreditation. Avoid scams by checking reviews from sources like Trustpilot and Google, or check with the Better Business Bureau.

TurboDebt offers expert debt relief services that you can take advantage of now. Contact us today for a free debt relief consultation.