Montana Debt Relief

In a Nutshell

While finding debt relief in Montana might seem daunting, we’re here to help make it easier with our complete guide below. We’ll cover the most effective forms of debt relief, the top types of debt that we see residents struggle with, and helpful financial assistance and hardship resources for short-term relief.

Based on our work assisting thousands of clients with debt relief programs specific to their financial needs, we know how essential it is to understand the advantages and disadvantages of each debt relief option. After reading this article, our goal is to help you feel more confident about choosing a relief option that suits your financial situation best. By addressing your debt, you can regain control of your finances and work towards a debt-free future.

Montana's Economic Picture

The Big Sky Country is well known for its abundant natural mineral resources, diverse wildlife, natural beauty, and expansive rugged terrain. Additionally, the state relies on agriculture, with wheat as the leading crop in production. 

The economy of Montana grew by 1.4% from 2021 to $59.3 billion, as the economy added more jobs and unemployment rates fell after pandemic highs. The gross state product growth rate is 0.49% against the national 0.19%, showcasing that the economy in Montana outpaced the national economy.

The leading industry in the state is petroleum refining, with revenue of $15.1 billion, while the leading employment sector is healthcare and social assistance, with a growth rate of 2.1%.

How Does Debt Relief Work in Montana?

Getting debt relief in Montana involves taking steps to reduce or eliminate the amount of debt that you owe. This can be achieved through several key methods, including debt consolidation, bankruptcy, or settlement.

Out of these options, the most effective methods reduce secured or unsecured debts by lowering interest rates, extending monthly payments, reducing portions of a debt, or waiving late payment fees. Both private, nonprofit, and government organizations offer different forms of debt relief.

Debt and Finance statistics specific to the state

Based on our research, the most impactful debt and finance statistics in Montana include the following:

• The average consumer debt in Montana increased by 5.1% to $98,843
• Montanans have an average credit card debt of $5,039, below the average American’s $5,589.
• Residents of Montana owe a monthly average auto loan debt of $547
• The monthly median mortgage cost is $1,538, while the median gross rent is $886
• The average student debt loan in the state of Montana is $33,149
• The total number of bankruptcy cases filed in 2022 was 591 from 654 in the previous year
• The unemployment rate in Montana declined to 2.5%, making it the 4th state with the lowest unemployment rate in America
• Residents of Montana have a personal income of $64,932, which is an increase from $61,495 in Q3 of 2021
• Montanans have an average credit score of 731, up from 730 in 2021

Average Consumer Debt

The average consumer debt in Montana increased by 5.1% to $98,843 from $94,008 due to the high cost of living and raised interest rates. This has made the cost of loans rise, therefore impacting consumer debt as spending increases.

Credit Card Debt

Montanans have an average credit card debt of $5,039, below the national average of $5,589.

Although Montana's credit card debt is below the national average, it has increased from $4,778 in 2021. This increase in credit card debt can be attributed to the high cost of living that consumers are grappling with in the midst of an inflationary economy.

Auto Loan Debt

Residents of Montana owed a monthly average auto loan debt of $547 in 2022, slightly lower than the national monthly average of $568. Although Montanans owe less than the average American, their auto loan debt has increased by 8.2% since 2017.

The pandemic and high demand for cars due to supply chain disruption are largely responsible for the increase in auto loan debt.

Mortgage Debt

Most of the residents in Montana are homeowners, with the state enjoying a homeownership rate of 69.1%. The monthly median mortgage cost is $1,538, compared to the median gross rent of $886.

The Treasure State has an average home value of $451,505. Metropolitan areas like Missoula and Butte enjoy average home values of $533,402 and $269,351, respectively.

Student Loan Debt

11.7% of Montana residents owe a total student loan debt of $4.2 billion. The average student debt loan in the state of Montana is $33,149, and the median is $28,727, with 50.9% of the debtors below 35 years, while 33.7% of the residents have attained a bachelor’s degree or higher.

Household Debt

In Q3 of 2022, household debt increased by 2.4% to $16.90 trillion. This led to a moderately high debt-to-income ratio in Montana at 1.772, indicating that much of each resident’s income is going toward covering debts.

Bankruptcy

Montana’s bankruptcy trend has been declining as consumers find alternative means of paying consumer debt, thus avoiding bankruptcy proceedings.

The total number of bankruptcy cases filed in 2022 was 591, down from 654 in the previous year. Chapter 7 bankruptcy filings led with 486 cases, followed by Chapter 13 bankruptcy cases at 94, then Chapter 11 at nine.

Average Income and Employment

The unemployment rate in Montana declined to 2.3% in May of 2023, making it one of the states with the lowest unemployment rate in America. The Big Sky Country has enjoyed a historically low unemployment rate since 1976, as Montana added 1,500 new payroll jobs in January 2023. The construction industry is the leading employment industry in the state.

The median household income in the Treasure State is $60,560, while the per capita income is $34,423.

Credit Scores

Montanans have an average credit score of 731, up from 730 in 2021. This is considered a "good" credit score, making it easier for residents of Montana to access lower-interest loans.

The yearly increase in credit scores can be related to the low mortgage delinquency rates in the state as residents found alternative means of settling their debts. Montana’s mortgage delinquency rate is 3.16%, which is among the lowest in the state.

Identity Theft

Montana ranks 43rd nationally with 707 identity theft cases. The top types of identity theft include the following:

• Credit card fraud at 35%
• Phone or utility fraud at 26%
• Other identity theft at 23%
• Bank fraud at 13%
• Employment or tax-related fraud at 9%

The total number of fraud and other reports filed in the state, including identity theft, amounted to 6,064. Total fraud losses came to $3.6 million.

Banking and Tax Info

The top individual income tax rate in Montana is 6.75%, but it’s set to decrease to 6.5% in Q1 of 2024. The state and local tax burden is 10.1%, while the top corporate income tax rate is 6.75% ranking the state 5th in the state business tax climate index.

Even though the state doesn’t impose a state and local sales tax rate, it has an excise tax of 33.25 cents per gallon of gasoline and $1.70 per 20-pack of cigarettes. The property tax rate is 0.74% of the owner-occupied house value.

The state of Montana has 39 banking institutions with a total deposit of $76,425 million, which is an increase in deposits from when the pandemic was at its peak. The largest financial market in the state is Billings, with a total deposit of $7.763 billion, followed by Missoula, with deposits totaling $3.831 billion.

How TurboDebt Helped Montana Residents With Debt Relief in 2022

Last year, our debt relief company worked with 408 clients in Montana to better manage and help eliminate their debts. Out of these individuals, 150 enrolled an average debt of $21,777 in our program. This led to a total enrolled debt of $3,266,603 in the state last year. Our debt relief program saved clients 53.45% of their total enrolled debt, resulting in total savings of $1,745,999 before service fees.

Top Types of Debt to Get Relief from in Montana

In Montana, many residents struggle with debt and seek debt relief solutions to manage their financial obligations. At TurboDebt, the following types of debt are the most common that we see Montanans dealing with when they enroll in our program.

Credit Card Debt

Credit card debt is largely influenced by the rise of interest rates, which can jump to 25% APR, leading to sky-high interest payments and accumulated credit card debt. Such a financial situation makes clearing credit card accounts difficult, especially for residents with low disposable incomes and a high cost of living.

Our experts help you manage debt from credit cards, guiding you toward a debt-free life with a plan customized to match your income. 

Divorce Debt

The state of Montana is an equitable distribution state. As such, assets and debts accumulated during a marriage are divided equitably between spouses after considering factors like the marriage duration, amount and sources of income, needs, vocational skills, and employability, among others.

These factors, as well as the cost of divorce, which can surpass $20,000 depending on the complexity of the divorce process, make it likely you'll accumulate debt after a split from your spouse.

At TurboDebt, we’re passionate about helping you break free from divorce debt through our debt settlement plan.

Business Debt

The state of Montana is ideal for starting and running a business because it doesn’t charge a state and local sales tax rate. However, the operational costs of doing business can cause you to accumulate business debt. 

In this case, a settlement or debt management plan is often an effective solution for residents struggling with business debt. DMPs can reduce high-interest rates and assist you in clearing the debt in three to five years with consistent monthly payments. Reach out now to benefit from our free consultation.

Medical Debt

A staggering 10.1% of Montanans lack medical insurance, meaning they can’t access premium medical aid without incurring extra costs that result in high medical bills.

Additionally, 29.3% of Montanans live below the 200% federal poverty level and cannot afford premium medical packages leading to the accumulation of medical debt. If you need relief from medical debt, contact TurboDebt to see how much we could save you as you pay off your outstanding healthcare balances.

Homeowner Debt

The onset of the pandemic brought financial hardship to homeowners as unemployment rates spiked above 10%, leading to difficulties in paying mortgages and rental fees. This led to the accumulation of homeowner debt as residents of Montana struggled to meet consumer demands.

As the housing market in Montana continues to inflate with high home values and elevated interest rates, first-time home buyers are also finding themselves strapped with more debt as they purchase a property.

Don't let your homeowner debt spiral out of control. Let the experts at TurboDebt help you create a plan.

Retirement Debt

Since social security benefits only replace about 37% of your income, it's imperative to save and plan for retirement. Montana ranks in the middle of the U.S. for affordability and 15th overall for the best states to retire due to quality of life and health care. 

Regardless of what you save, living on a fixed income makes it challenging to cover unexpected expenses. It can be even harder to clear if you bring debt into retirement. 

At TurboDebt, we can assist you in avoiding retirement debt through a program tailored to your retirement income.

Montana Debt Relief Options

Debt relief options in Montana include debt consolidation, debt settlement, and bankruptcy, among others. You can access these solutions from reputable debt relief companies, such as ours, that operate in the state.

Debt Management Programs

Debt management programs (DMPs) are administered by various private companies and some non-profits. A debt management program helps you negotiate reduced interest rates and waived fees for late repayments.

For you to be eligible for a DMP, you must close your existing credit cards to avoid accumulating new debt and commit to making monthly payments. The account will be used to pay off creditors so you can escape the never-ending cycle of unsecured debts.

The loan repayment period for a DMP can last for three to five years, which is why some debt collection agencies may be opposed to accepting debt management plans.

Debt Consolidation Loans

Debt consolidation loans involve taking out a larger loan to make a lump sum payment for your existing debts. This eliminates the need to make multiple payments to your creditors, reduces interest fees by eliminating high-interest loans, and lowers the monthly payments since you’ll be paying off a single consolidated loan.

Since Montana residents carry a high average credit score, they're likely to qualify for a debt consolidation loan. However, residents with poor credit may find it hard to secure a loan with reasonable interest, making them pay more to consolidate debts.

Some of the types of loans used in debt consolidation include personal loans, home equity loans, and balance transfer credit cards.

Debt Settlement

Debt settlement plans are ideal for borrowers who owe big debts for credit cards or other outstanding bills. Once you enroll in a plan with a debt settlement company, you'll start making payments into a savings account and stop paying your creditors. The organization then negotiates with your creditors to relieve part of your debt, reducing your payoff amount by 40-60% before service fees. 

While stopping payment may negatively affect your credit score in the short term, after making consistent payments and ending your debt, you'll likely see your score quickly improve. 

Credit Counseling

A unique debt relief option, credit counseling is typically offered at little or no cost to participants. Once you join a program, you'll receive free educational workshops on money and debt management. Credit counselors can aid you in accessing free credit reports and guide you through creating an effective budget. They can also help you select a debt management plan based on your DTI ratio.

Bankruptcy

Many borrowers dread filing for bankruptcy even though it can help clear debt. This is because bankruptcy cases last from seven to 10 years in your credit report, thus affecting your eligibility for loans in the future.

Chapter 7 bankruptcies, which are the most common, require debtors to liquidate their non-exempt properties to cover their debts. Debt balances that remain after liquidation are discharged, and you no longer need to repay them.

Chapter 11 bankruptcies are for businesses struggling with debts. This type of filing helps businesses reorganize their debt payment plans without interfering with daily business operations.

Businesses or individuals with a regular income can also file for Chapter 13 bankruptcies, where they decide which assets to keep and enter into an extended repayment period of three to five years.

Bankruptcies are suitable for unsecured debt as secured debts are prone to repossession or foreclosure. Get legal advice from your law firm on the best type of bankruptcy for you and your business.

Debt Forgiveness

Debt forgiveness cancels your existing debts from lenders to give you a fresh start. This debt relief program benefits borrowers struggling to meet their basic needs. However, to qualify for debt forgiveness, you must enroll in an existing debt forgiveness program like the federal student loan forgiveness program.

It's also important to note that once your debt balances are forgiven, you must file them with the IRS as income.

Debt and Financial Hardship Resources

Low-income residents struggling with debt or living below the federal poverty level in Montana can access the following debt and financial hardship resources:

Temporary Assistance Programs

TANF is a temporary cash assistance initiative for needy families that lasts for a maximum of 60 months in an adult’s lifetime. You must fulfill certain requirements to qualify for the program, such as owning countable resources not exceeding $3,000 in value.

The Low Income Home Energy, Water, and Weatherization Assistance Program pays a portion of winter energy bills and household water bills, and it improves the heating efficiency of eligible low-income residents of Montana.

CDBG CARES is a financial relief program offered to low-income residents dealing with the effects of the pandemic and living in entitlement areas or working within these entities.

State Health and Human Services

Montana Medicaid and Healthy Montana Kids Plus is a healthcare coverage program that is available to eligible low-income residents. Apart from the several medical benefits, you can access additional benefits subject to an annual cap of $1,125. Residents who are below 20 years, blind, disabled, or aged are exempted from the annual cap.

The Supplemental Nutritional Assistance Program (SNAP) is a food assistance program for eligible households that meet specific requirements. The program includes the SNAP Nutrition Education and Obesity Prevention Program and SNAP Training and Employment Program.

Comprehensive Primary Care Plus (CPC+) is an advanced home program that offers primary medic care based on a value-payment system instead of a fee-for-service system. The program focuses on the following five key functions:

• Care management
• Patient and caregiver engagement
• Planned care and population health
• Access and continuity
• Comprehensiveness and coordination

Developmental Disabilities Program is a tailor-made program for people with developmental disabilities and their families to access care in a natural setting.

WIC is a supplemental food program offered to women, infants, and children. The program supports breastfeeding, gives nutrition tips, and connects eligible members to community resources.

Big Sky Rx Program is an initiative that pays for prescription drugs by enabling Medicare recipients to meet the generous income criteria and access insurance premiums.

Child Care

Healthy Montana Kids offers free or low-cost medical assistance to eligible Montana kids below the age of 19 years. The program covers dental, medical, eyeglasses, and other related medical benefit services.

The Early Childhood Services Bureau seeks to improve the accessibility, affordability, and quality of early childhood care and education administered to qualifying young children, their families, and professionals who support and work for the program.

HELP Medicaid Plan (Medicaid Expansion) offers quality medical coverage for members who pay their monthly premiums.

Shelters for the Homeless

Mental and Substance Use Disorders and Homelessness Resources is a program for people experiencing homelessness due to mental issues or substance abuse. It offers them shelter as their conditions stabilize.

Montana Program for Homeless Youths offers runaway youths access to food, shelter, guidance and counseling, and education.  

The CDBG Housing Program offers to construct homes for families below 80% of the area’s median income to avoid homelessness. The program offers housing grants through the annual CDBG Competitive Housing Grant and the open CDBG Noncompetitive Housing Grant.

The HOME Program is a housing program meant to offer families living below the 50% and 80% median income safe, affordable, and decent houses.

The Housing Trust Fund Program seeks to establish affordable houses for residents with extremely low incomes, including those that are homeless, with special needs, and are at risk of homelessness.

Montana Homeless Shelters throughout the state have been established to provide temporary housing to residents facing homelessness. 

Free Transportation Services

Medicaid Transportation Services offers Medicaid members transportation services to and from medical appointments.

Finding Debt Relief in Montana

For residents needing debt relief in Montana, it's crucial to research and understand the various options available so that you can make an informed decision that best suits your financial situation.

Professional assistance from debt relief companies, credit counseling agencies, and bankruptcy attorneys can provide guidance and support throughout the process. Practice due diligence and avoid scams by checking with the Better Business Bureau to check for legitimate debt solutions. By taking action and addressing your debt, you can regain control of your finances and work towards building wealth once again.   

TurboDebt offers assistance to residents overwhelmed with debt. Take advantage of our free debt relief consultation services now to learn more about how much we could help you save. We're ready to help you live debt-free.