Nebraska Debt Relief

Key Take Aways

When it comes to debt, Nebraskans are much better off than many other states. However, many residents still need help with areas of debt like credit cards, medical, and payday loans. Keep reading to learn more about debt facts and statistics for Nebraska, what options you have for debt relief in Nebraska, and how TurboDebt can help you get on a path to becoming free from debt.

How are Nebraskans doing financially?

Some people might call it a “flyover state,” but Nebraskans know that Nebraska is a pretty great place to live. As of November 2022, Nebraska ranked fifth for states with the least amount of debt. The debt-to-income ratio in Nebraska is .67, and the overall cost of living is 7% lower than the national average.

Nebraska’s largest industries are corn, wheat, & soybean wholesaling and meat, beef, & poultry processing. More Nebraskans are employed in the healthcare and social assistance sector than any other sector in the state’s economy.

Like much of the united states, Nebraska is expected to see some recession in 2023, but experts predict that the economy will pick up again in 2024.

How does debt relief work in Nebraska?

Having outstanding debts can take a huge toll on you financially and emotionally. Fortunately, there are plenty of debt relief options in Nebraska for those in need of them. If your debt is too big to manage alone, you can enlist the help of a credit counseling agency or a debt settlement company. A credit counseling agency will provide advice and support you in developing a plan and budget for repaying your debts and may help you enroll in a debt management program. A debt settlement company, on the other hand, will negotiate with your creditors to see if they will agree to allow you to pay off only a portion of your debt.

Nebraska: A Financial Snapshot

Overall, Nebraskans struggle with debt less than residents in other areas of the country. However, this does not mean that Nebraskans live completely free from debt. The two biggest sources of debt in Nebraska are mortgage debt and student loan debt. Fortunately, living in Nebraska is relatively affordable, and the state boasts lower-than-average unemployment rates.

Average Consumer Debt

Average consumer debt describes the sum total of average debt an individual living in the state has. This includes credit card debt, auto loan debt, mortgage debt, and student loan debt. When you add these numbers up from below, that brings the average total consumer debt in Nebraska to $211,065.

Credit Card Debt

Nebraska ranks 39th in the country for the largest average credit card debt, making it better than more than half of the other states. The average credit card balance in Nebraska is $5,423. This is $771, below the national average of $6,194.

When you go to pay your credit card bill each month, you will have the option to make either a minimum payment or pay off the entire balance for that billing period. If you only pay the minimum payment, you will be charged interest on the remaining balance. This is one of the ways credit card debt can quickly spiral out of control.

Auto Loan Debt

The average auto loan balance in Nebraska in 2021 was $20,102. This was up by 6.6% over the previous year but still less than the national average of $20,987.

Mortgage and the Housing Market

Mortgage debt makes up a large portion of most Americans’ total debt, and Nebraska is no exception. The average price for a home in Nebraska is $265,400. The average Nebraskan owes $153,621 in mortgage debt and has a monthly payment of around $1,014. The average interest rate for a 30-year fixed-term mortgage in Nebraska is 6.99%. Nebraska has the 7th highest property tax rate in the nation at 1.63%.

Student Loan Debt

The average amount of federal student loan debt per borrower in Nebraska is $31,919. For comparison, the national average is $37,787. After mortgages, student loans are the second largest source of debt in Nebraska and the country.

Household Debt

When mortgages, auto loans, student loans, and personal loans are added up, the average family in Nebraska has $82,651 in debt.

Bankruptcy

In 2022, 2,150 individuals filed for bankruptcy in the state of Nebraska. Of these filings, 1,393 were for Chapter 7, 20 were for Chapter 11, and 728 were for Chapter 13. The remaining nine filings were for other types of bankruptcy.

Average Income and Employment

The median household income in Nebraska from 2017-2021 was $66,644. The average per capita income was $35,189. As of January 2023, the unemployment rate in Nebraska was 2.5%, almost a full point lower than the national average of 3.4%.

Credit Scores

The average credit score in Nebraska is 731, which is relatively strong. You can check your credit score by ordering a free credit report once a year from Experian, Equifax, or TransUnion.

Identity Theft

In 2020, Nebraska reported 2,182 incidents of identity theft, a rate of 113 incidents for every 100,000 residents. This was the third-lowest rate of any state that year.

Banking and Tax Info

As of June 30, 2022, there are 140 state-chartered banks and 11 credit unions in the state of Nebraska. Nebraska’s banks received $50,253,274 in deposits in 2022.

Nebraska uses a graduated individual income tax rate system. The lowest tax bracket is taxed at 2.46%, while the highest tax rate is 6.64%. State sales tax is 5.50% with a maximum local tax rate of 2.00%. Nebraska has the 38th largest tax burden in the nation.

TurboDebt’s Internal Debt Statistics for Nebraska in 2022

In 2022, TurboDebt helped 731 Nebraska residents and of those, enrolled 247 clients into its debt relief program. The average debt for each client enrolled was $21,653. Most importantly, TuboDebt helped Nebraskans save an average of 52.09% of their total debts owed before fees. If you’re curious about how much you could save, don’t hesitate to get in touch for a free consultation.

What types of debt do Nebraskans need relief from?

TurboDebt helps residents of Nebraska find relief from many types of debt. Some of the reasons Nebraskans find themselves in debt are due to high credit card usage, divorce, medical emergencies, retirement, using personal credit to fund a business or the cost of owning and maintaining a home.

Credit Card Debt

Credit card debt hit an all-time high of $930 billion in the last financial quarter of 2019. This is $60 billion more than the record-breaking debt peak during the 2008 financial crisis. In addition to rising debt, delinquencies also rose by .16% over the previous quarter. Young Americans are particularly at risk for delinquency, with a 76% higher delinquency rate than any other group.

As of January 2023, Nebraskans have a credit card delinquency rate of 6.72%, up 0.07 since before the pandemic. Payments are considered delinquent 90 days past their due date. Overall, credit card debt makes up 18.3% of all non-mortgage debt in Nebraska. As one of the top forms of debt that we deal with, TurboDebt is well-positioned to assist Nebraska residents to get out of credit card debt.

Divorce Debt

About 2.6% of all marriages in Nebraska end in divorce. When a couple of divorces, most debt incurred during the marriage is considered a joint responsibility, including credit card debts and mortgages. Financial stress is known to strain relationships, and a large amount of debt can increase the likelihood that you and your partner will divorce. Once the divorce is finalized, the debts are still left to be paid.

Divorce itself can also be costly. In Nebraska, it costs $161 to file for divorce. If the divorce is contested and you need a lawyer, that lawyer’s hourly rate will likely be between $250 and $350. The more disputes there are to settle, the more you will end up paying your lawyer. The average divorce in the US costs over $15,000. If you need help with divorce debt, know that TurboDebt can help you find a solution.

Business Debt

Almost all businesses will have some amount of debt. However, business debt can be classified as “good” debt and “bad” debt. Good debt is money that a business owner borrows to invest in growing their business. Good business debt increases the company’s overall net worth.

Bad debt, on the other hand, is debt that a business will have a hard time repaying and will decrease the overall net worth of the company. A bad debt is any debt the business cannot reasonably pay off in the expected time frame.

Many businesses in the U.S. get their start thanks to small business loans. Nebraska, along with Minnesota and North Dakota, has one of the lowest default rates for small business loans.

Medical Debt

The point of health insurance is to make sure that all Americans can afford necessary healthcare. Unfortunately, that is not always the case. Many people do not have health insurance at all. In Nebraska, about 5.8% of the population is uninsured. Even for those who do have insurance, their coverage might not cover every test, visit, treatment, or procedure. In either case, the patient is expected to pay for their care out of pocket. If they do not have the cash on hand to make the payment, they will have to use a line of credit. This could mean charging the bill to a credit card, taking out a personal loan, or borrowing against their home’s equity.

About 6% of the population of Nebraska owes a collectible medical debt. The average amount owed is $653. If you’re struggling to pay down your medical debt, it might be time to seek a solution, and we can help.

Homeowner Debt

The largest source of homeowner debt in the United States comes from mortgages. In Nebraska, the average homeowner owes $153,621 on their mortgage and has a monthly payment that exceeds $1400. Owning a home also requires extensive upkeep and maintenance, usually from trained professionals. Even if homeowners are diligent about having their property serviced, an accident or natural disaster could still result in property damage. In the event of an unexpected emergency, homeowners may also have to take out loans to pay for repairs. If home-related expenses are causing you debt, it might be a good time to consider a relief option.

Retirement Debt

The retirement age in the United States is 65 years old. Once they reach the age of retirement, the average Nebraskan has almost 20 additional years of life expectancy. In order to comfortably retire in Nebraska, the average adult can expect to spend $1,002,765 over the remainder of their life. Americans aged 55-65 have an average of $197,322 in savings. As they get older, health complications or increased support needs may force retirees to dip even further into their savings or take out loans. Any loans you have at the time you retire will still need to be paid off in full, even if you no longer have a steady income.

Debt Relief Options in Nebraska

Below are some of the most effective strategies for debt relief in Nebraska.

Debt management programs

If you have multiple sources of debt, having to keep track of all your different monthly payments and when money is due to who can make paying them off even harder. A debt management program helps make repayment easier by combining all of your separate monthly payments into a single monthly payment that you make to a credit counseling agency. You will still owe the same principal debt amount, but your repayment plan will be more organized, and you may be eligible for lower interest rates or fee waivers, decreasing the overall cost of paying off the debt in the long term.

Debt consolidation loans

Debt consolidation loans are similar to debt management in that they streamline the repayment process by consolidating all of your payments into one monthly payment. The main difference is that you go through another lender instead of a credit counseling agency.

When you apply for a debt consolidation loan, you apply for a new credit account that is equal to the total amount of debt you owe. Once you use that credit to pay off what you already owe, you are left with a single monthly payment to pay off your debt consolidation loan.

Just like with any other line of credit, you will need to apply and meet the lender’s eligibility requirements. If you do not have a good credit score due to your existing debts, this may be difficult but not necessarily impossible. If most of your debt comes from credit cards, you may be able to consolidate your payments with a balance transfer card.

Debt settlement

You can also work with a debt settlement company, like TurboDebt, to negotiate with your creditors to allow you to settle your debt for a lower lump sum payment. While you will still be responsible for paying off some of the debt, you will not have to pay the full amount. TurboDebt is one of the most reliable debt settlement companies currently working in Nebraska.

Credit counseling

Credit counseling is usually offered at little to no cost through nonprofit organizations. A credit counseling agency will connect you with one-on-one support and mentorship from a credit counselor. Your counselor will review your current financial position and help you develop a plan for budgeting and repayment so you can escape debt.

Bankruptcy

Those unable to pay their outstanding debts may file for bankruptcy. Bankruptcy allows the borrower to achieve debt forgiveness while also ensuring that the lender gets some form of repayment.

The two most common types of bankruptcy are Chapter 7 and Chapter 13.

Chapter 7 bankruptcy is used to erase unsecured debts like credit card balances or medical bills. When an individual files for Chapter 7 bankruptcy, they sell off their non-exempt assets to pay back as much of their debt as possible.

If you make too much money to qualify for Chapter 7 bankruptcy, you may file for Chapter 13 bankruptcy. Chapter 13 bankruptcy is more attractive because it allows the debtor to keep all of their property. Instead, the debtor can repay their debts in installments over the course of 3 to 5 years.

Debt forgiveness

Some lenders or creditors may offer debt forgiveness programs to those who are experiencing financial hardship. If you seek debt forgiveness, a portion or all of your debt may be erased, meaning you are no longer responsible for paying back that money.

In 2023, the federal government introduced a loan forgiveness program for federal student loan debt. The one-time federal student loan debt relief program is designed to allow eligible borrowers to discharge up to $20,000 of their loans. As student loan debt is the second leading cause of debt in the United States, this could be a huge step towards reducing the amount of debt Nebraskans, and Americans find themselves dealing with.

Debt and Financial Hardship Resources

If you are struggling to pay your debts and bills in Nebraska? In addition to seeking debt relief, you can also take advantage of the following assistance programs to help ease your financial burden.

Temporary assistance programs

Temporary Assistance for Needy Families (TANF) is a federal program that provides cash assistance to families with dependent children living below the poverty line. Nebraska administers TANF funds through Aid to Dependent Children (ADC). Adults who are able to work are provided services through the Employment First program to help families achieve economic self-sufficiency. Families in which a parent is able to work are limited to 60 months of cash assistance in their lifetime. If a child is not in the care of their biological parents or the parent is disabled, there is no limit.

Nebraska health and human services

Nebraska’s Department of Health and Human Services (DHHS) administers the state’s SNAP and WIC programs. Through the Low Income Home Energy Assistance Program (LIHEAP) and the Low Income Household Water Assistance Program (LIHWAP), both fully federally funded programs, the DHHS provides Nebraska residents in low-income households essential utilities at a discounted rate. The department also provides assistance for those with disabilities and special healthcare needs.

Shelters for the homeless

The Nebraska Homeless Assistance Program (NHAP) provides supplementary funds to community agencies that aid homeless or nearly homeless Nebraskans. Funding goes toward street outreach, emergency shelter, homeless prevention, and rapid rehousing.

Free transportation services

Madonna Medical Transportation (MMT) and Medicaid Transportation Company (MTC) provide no-cost door-to-door transportation with a Medicaid waiver in and around Lincoln and Omaha. InetlliRide helps those receiving services through DHHS arrange transportation for non-emergency appointments. Most municipalities offer paratransit services. Check with local community organizations to see who might offer services in your area.

Childcare

The DHHS provides subsidies for low-income parents to assist with the cost of childcare. The Child Care Subsidy Program is for children under the age of 12 and requires parents to be working, in school, receiving medical treatment, or otherwise unable to work. Parents are allowed to choose their provider and may be able to have the complete cost of childcare covered, but the provider must be approved by DHHS.

Break free from debt in Nebraska with TurboDebt

There are many debt relief options available in the state of Nebraska. It is never too late to take control of your financial future. Working with a credible debt settlement company like TurboDebt can help you achieve debt-free living.

When looking for a debt relief partner, be wary of scams. Sites like Trustpilot or the Better Business Bureau (BBB) can help you determine if the company you are considering is a legitimate debt settlement company that can help you escape debt or a scam.