Pennsylvania Debt Relief
17 MIN READ
Published April 05, 2023 | Updated October 02, 2023
In a Nutshell
If you’re like a lot of other Pennsylvania residents, you’re facing debt from credit cards, loans, or medical bills that are increasing faster than your income.
TurboDebt’s Pennsylvania debt relief programs can help you eliminate debt without having to declare bankruptcy. Together we’ll tackle high interest rate balances to get you living debt-free as soon as possible so you can focus on building wealth instead of struggling to pay bills each month.
What Debt Looks Like in PA
Pennsylvanians have a lot to be proud of, like their historical sites, lush valleys, and the biggest chocolate empire east of the Rockies. Home to the Declaration of Independence and the timeless beauty of Amish farmlands, the Keystone State offers residents so many reasons to call PA home.
Pennsylvania may be known for cheesesteaks, pretzels, and the Liberty Bell, but there’s more to the story. The fifth-largest state in the nation, residents are also burdened by increasing amounts of debt as inflation makes it harder to afford even essential items and services.
The Keystone State’s debt-to-income ratio sits at 1.24, meaning for every dollar Pennsylvanians earn, they owe nearly 25 cents more. In a time of economic uncertainty, taking control of your outstanding debts can change your financial situation.
Read on to learn more about the kind of debt PA residents face and how you can partner with TurboDebt to pay off outstanding balances and even save up to 54% on your bills before fees.
Pennsylvania Debt and Financial Overview
Consumer debt keeps growing as inflation rages, and economic uncertainty affects growth. Learning more about what debt looks like in the state of Pennsylvania can help you see that you’re not alone if you’re struggling to pay bills.
Financial burdens for consumers come in two forms: secured and unsecured debt. Secured debt like mortgages and car loans have higher stakes because if you don’t pay, the lender can take your home or car for repayment. Unsecured debt from items like credit cards and medical bills is a little safer for the borrower but can still wreck your credit report if you fail to pay.
From Philadelphia to Pittsburgh, here’s a look at the biggest debt statistics that impact residents of the Keystone State:
Average Consumer Debt
Although lower than the national average, residents of the Keystone State owed $48,350 in total debt per household in 2022. This includes mortgages, student loans, credit cards, auto loans, and home equity lines of credit. If you’re paying on a personal loan for a small business or other needs, your debt may even surpass this figure.
Average consumer debt in Pennsylvania rose by nearly $3,000 from the same quarter in 2021. That’s a 5.7% increase in just one year, showing households are burdened by accelerating debt. TurboDebt offers Pennsylvania debt relief solutions to help you pay off your outstanding balances quickly and efficiently, getting you back on track in a tough economy.
Credit Card Debt
Credit card balances in the U.S. reached 990 billion in quarter four of 2022, up from 860 billion the previous year, according to the Federal Reserve Bank (FED).
Charging necessary items on a credit card offers an easy solution to make purchases, but paying only a minimum from month to month can quickly sink you into debt. Late fees and high interest rates make rolling credit card balances a vicious cycle when your income doesn’t keep up with your charges.
Auto Loan Debt
With the cost of new and used cars on the rise, more households need help to make monthly payments. Individuals across the U.S. are paying an average of $700 a month for a new car payment.
Pennsylvanians carry an average auto loan balance of $4,960, not far behind the national average of $5,490. Individuals aged 30-39 and 40-49 hold the largest burden from auto loans, with 360 billion and 370 billion in debt, respectively.
Pennsylvania’s extended lockdowns during the pandemic brought the housing market to a full stop until restrictions ended. After explosive sales in the wake of COVID shutdowns, the real estate market in PA boomed. Things have since slowed down, especially for first-time buyers, who make up a historic low of only 26% of purchases.
On average, Pennsylvanians owed $29,900 on their mortgages in 2022, up from $28,350 the year before. Home sales dropped by roughly 30% in early 2023 when compared to the previous year.
Home prices remain steady, though, which is great if you’re trying to sell, but tricky for those looking to find affordable housing. Homes sold at a median price of $195,123 in January of 2023, a year-over-year increase of 2.5%.
Student Loan Debt
Paying off student loans can take decades, especially when you’re trying to pay a mortgage and finance a car at the same time. Student loan debt in PA is higher than the national average, sitting at $6,750 per capita.
Thankfully, the U.S. population, in general, has seen a tremendous decline in the number of bankruptcies filed over the past ten years. As more Americans get help through debt relief programs like TurboDebt, the process of turning debt collection over to the court system has affected fewer PA residents in recent years.
However, in 2022, 9,707 people still filed for bankruptcy in Pennsylvania. Before filing, consider using one of TurboDebt’s varied Pennsylvania debt relief options to reset your finances.
Average Income and Employment
With over 300,000 employers in the state, Pennsylvania Residents earn an average household income of $67,587 and $37,725 per capita.
Holding a job that offers competitive wages and benefits can prove challenging, especially in times of economic downturn. The Keystone State’s unemployment rate sits at 3.9%, just above the national average of 3.4%.
If you’re out of work, the state offers unemployment benefits with a $572 maximum weekly amount for up to 26 weeks.
Credit scores on the national and state level indicate a credit holder’s ability to make full payments on time for accounts like credit cards, loans, and mortgages. The Fair Isaac Corporation (FICO) issues a score ranging from 300 to 800, ranking the debtor’s ability to meet their obligations.
Experts have shared concern that 2022 showed no positive change in credit scores from the previous year for the first time in a decade. The average credit rating for the nation was 716 in 2022, a “good” score by FICO standards. Pennsylvania averages a little higher at 723.
The unchanged national credit score indicates higher consumer debt levels, a rise in active credit accounts, and an increase in missed payments. In a time when debt levels continue to trend upward, TurboDebt offers solutions to improve your financial situation.
Pennsylvania ranks 8th in the nation with 154,313 reports of identity theft in 2021. This kind of theft often happens when digital criminals access secure information from an online account or data storage files.
The Pennsylvania Department of Revenue defines identity theft as the act of committing fraud using your name, social security number, and other personal information without your permission.
Identity theft can negatively impact your credit score when false charges appear on your accounts. Protect yourself by securing digital and physical documents, monitoring your credit statements for false charges, and sharing sensitive information carefully.
Banking and Tax Info
Pennsylvania residents pay a 3.07% personal income tax rate for the following classes of income:
- Net profits from business operations
- Net gains from property dispositions
- Net gains from rent, patents, copyrights, and royalties
- Income derived through estates or trusts
- Gambling and lottery winnings
When it comes to financial security, up to 3.4% of the state population is considered unbanked or underbanked. Unbanked and underbanked Individuals who don’t keep their money in banks use alternative means to access funds, including money transfers, digital pay services, and cash advance loans. Those not using bank accounts are at risk of falling into debt by paying higher fees for financial services.
Take Control of Your Finances with TurboDebt
Finding a debt relief organization you can trust matters. In 2022, we helped nearly 4,000 clients throughout the country navigate the debt management process. If you’re living in Pennsylvania, you can access customized debt relief options to fit your needs through one of our many programs.
Our programs typically save you money by lowering interest rates and eliminating fees for late or missed payments. We can even help you pay off your debt in a shorter amount of time than if you did it on your own!
Here’s a look at more of our vital stats from 2022:
- Total clients enrolled in our debt relief program: 1,361
- Total amount of debt enrolled: $30,743,865
- Average client debt enrolled: $22,589
- Average savings (before fees) after enrolling in our debt relief program 54.02%
Ready to get started? Read debt relief reviews from TurboDebt customers in Pennsylvania and throughout the U.S.
Options for Debt Relief
When you’re struggling with debt, you need options. The good news is you can find a variety of programs and services offered to PA residents that help you pay back and eliminate outstanding bills. Many of these options actually save you money and often help you pay off your debt faster once you enroll. Here’s a look at some of your choices for Pennsylvania debt relief:
Credit counseling takes a big-picture view of your finances to find the best debt relief options. During the process, you’ll work with a trained advisor through a counseling organization to create a payment plan, make a budget, and learn other strategies to develop better financial habits.
When you accept help from a credit counselor, they examine your income versus debt plus other factors like monthly expenses and credit scores to determine your optimal debt relief method. Debt management programs help you consolidate payments and often refer you to a credit counselor if paying off credit cards is your biggest financial problem.
Credit counseling agencies provide advice in the following areas:
- Personal loans
- Student loans
- Housing debt
- Credit history
- Foreclosure avoidance
- Small business finances
Debt Management Programs
Enrolling in a debt management program gives you a chance to consolidate your outstanding payments into a single sum each month. Debt management programs may function as separate organizations or as part of a credit counseling service.
Mostly used for credit card debt, debt management programs help you make a plan to resolve your outstanding balances. Debt management plans give you a schedule to pay off your outstanding balances, typically in less than five years.
Once you enroll, you’ll work with a Pennsylvania debt relief organization, depositing your funds into an account that’s set up to pay your creditors. Using a debt management program allows you to reduce interest rates and late fees by rolling your debts into one monthly payment. Your plan also pays your debt in full, so your outstanding balance won’t lower your credit score.
Debt Consolidation Loans
Another debt relief option for Pennsylvania residents is to combine multiple sources of debt into a single payment under a debt consolidation loan.
Imagine you owe a balance plus interest on multiple credit cards. Instead of continuing to pay fees for each card, you take out a loan to cover the total amount of all outstanding balances and pay them off. Now you owe a single monthly loan payment under one fixed and typically lower interest rate.
Your credit score determines your loan options and how high of an interest rate you’ll pay. If you have fair to good credit, consider using this method to get back to living debt-free.
Debt settlement gives you a chance to pay off your debts based on what you can afford to give. Once you enroll with a debt settlement company, they negotiate with creditors to create a payoff plan.
During the debt negotiation process, you may cease paying on all debts until you save enough to cover the total amount of your renegotiated balance.
The legal process of declaring bankruptcy is a last resort for reducing or eliminating your debt. In bankruptcy, the court decides how to allocate your assets to pay off creditors. If the court decides you have no way to pay off the amount you owe, they may void your debt, leaving you with a record that affects your credit for up to a decade.
Additionally, bankruptcy is divided into different chapters that affect both individuals and business entities. Most individuals declare either Chapter 7 or Chapter 13 bankruptcy. Filing Chapter 7 bankruptcy liquidates your assets, while Chapter 13 reorganizes your outstanding balances.
Under certain circumstances, you may qualify for debt forgiveness. Mainly offered through federal institutions, debt forgiveness can either greatly reduce or eliminate your debt. The Department of Housing and Urban Development offers housing assistance for qualifying participants through mortgage debt forgiveness. You can also find student loan forgiveness through the Department of Education (DOE).
When you enter a debt forgiveness program, you may need to meet certain requirements before, during, and after you eliminate or reduce your debt. For example, the DOE offers student loan forgiveness for educators who’ve worked at least five consecutive years as full-time teachers and hold no outstanding balances on loan payments.
Top Types of Debt to Get Relief from in Pennsylvania
Pennsylvanians, like others around the nation, often struggle in these top areas of excessive debt. If you’re burdened by debt in any of these areas, avoid debt collectors and start saving again through one of TurboDebt’s debt relief programs.
Credit Card Debt
Outstanding credit card debt negatively impacts your credit score, making it harder to secure loans at a reasonable interest rate. If you continue to roll unpaid balances over from month to month or make late payments, you’re also at risk of lowering your credit score and taking on debt.
If you plan to pay only the minimum balance each month to end your debt, it could take a long time. Credit card companies allow you to pay a minimum of generally 1-2% of your total balance but tack on high interest fees if you choose this route. Here’s a look at how credit card debt compounds when you only make the minimum payment for three months on a $1,500 bill:
|Month||Payment on Principal (2%)||Interest Fees (21%)||Total Minimum Payment||New Principal Balance|
As this chart shows, after three months, you’ve paid only $89 toward the principal and almost the same amount in interest.
TurboDebt helps you solve runaway credit card debt with a plan to pay off your outstanding balances and lower your monthly interest rates so you can save money instead of putting it toward fees.
Reallocating assets between you and your spouse can leave you financially devastated after a divorce. Support payments or the loss of a second income may leave you struggling to pay your bills.
Get help restructuring your finances after a divorce with our debt management services. When you enroll, you’ll get support from advisors who can give you the tools to recover from your financial losses and build a stronger system for saving and accessing your money.
Small business owners often use their own resources to start and maintain a company. Whether you operate as a limited liability company or single proprietor, it’s easy to build up debt until you become profitable. Many business owners struggled to stay open during the COVID-19 pandemic and in the wake of the uncertainty after lockdowns eased.
If you find yourself behind in paying off business loans or charges on your personal credit card, there’s a way out. Overcome business debt through TurboDebt’s relief options that help you consolidate payments and settle outstanding accounts.
Unexpected trips to the ER or even scheduled surgery can leave you with high medical bills. Even with health insurance, deductibles for health care costs often make it hard to pay off your debts.
If you’re caught in a cycle of paying the minimum balance or getting stuck with late fees as you wait for your paycheck to arrive, enrolling in one of TurboDebt’s relief options can help. We’ll look at your unsecured bills and find the best solution to pay off the debt completely.
If you’ve missed a mortgage payment or paid late, you’re not alone. Per the FED, a little over 1% of PA residents fell behind 90 or more days in mortgage payments in the last quarter of 2022. Home equity lines of credit can also trouble homeowners who can’t risk losing their house due to excessive missed and late payments.
TurboDebt’s debt relief options have helped thousands of individuals overcome debt with customized programs and advising.
Unplanned expenses can easily disrupt your budget as a retiree, with a set amount coming into your bank account each month. When you’re in debt and living on a fixed income, it can seem impossible to pay off outstanding amounts from loans, medical bills, and credit cards.
Let TurboDebt help you create a plan to pay off debt and restore your finances using your monthly retirement income.
Debt and Financial Hardship Resources
If you’re facing financial hardship, you may find immediate assistance from these state and federal programs and nonprofit organizations:
Temporary Assistance Programs
- Temporary Assistance for Needy Families (TANF): Participants with a family of three receive an average of $403 a month for up to five cumulative years after meeting certain work requirements or waiving requirements due to certain circumstances. Pennsylvania’s TANF program provides cash assistance for low-income families who meet portions of the following criteria:Have children younger than 18 in the householdLost a parentLost a jobHave a disability
- Have children younger than 18 in the household
- Lost a parent
- Lost a job
- Have a disability
- Low-Income Home Energy Assistance Program (LIHEAP): The LIHEAP program provides cash grants to help low-income families pay their monthly heating bills. They also provide immediate assistance for emergency heating provisions. Learn how to qualify and apply through their website.
- Emergency Rental Assistance Program: Berks County offers residents help to pay landlords for rent and utilities to ensure housing stability through the ongoing COVID-19 pandemic.
State Health and Human Services
- Medical Assistance (MA): Known as Medicaid, MA provides health care services for eligible participants.
- Health Insurance Premium Payment Program (HIPP): Families with at least one member enrolled in MA are eligible to get help paying for private insurance through an employer through Pennsylvania’s HIPP program.
Pennsylvania families who need childcare assistance can find help through the Child Care Works program. Families can get help from state and federal funding which subsidizes payments for childcare facilities.
Shelters and Help for the Homeless
Pennsylvania provides support for the homeless and those at risk of becoming homeless in the following areas:
- Emergency shelters: Shelters provide short-term housing and connect homeless individuals with case management services.
- Bridge housing: Bridge housing allows individuals to live in an apartment facility for up to 18 months for a small fee to help transition out of homelessness. Many residents living in a bridge facility also receive case management services.
- Case management: Case management services provide counsel to help the homeless or near homeless identify their needs. These programs also provide training in areas like life skills and budgeting and can refer participants to alcohol or drug services.
- Rental assistance: This program helps with payments and acts as a liaison between landlords and tenants to keep residents in their homes or apartments.
Free and Reduced Transportation Services
- Free Transit Program for Seniors: The Pennsylvania Department of Transportation offers free fares for senior citizens on fixed-route public transit systems. Those 65 and older qualify for a senior citizen transit identification card available at public transit offices.
- Reduced Transit for Persons with Disabilities: Pennsylvania also offers reduced rate public transportation for persons with disabilities through a reduced transit identification or Medicaid card. Rates are valid for fixed-route transportation during non-peak hours. Learn about routes and other transportation like ride shares from their webpage.
- Medical Assistance Transportation Program: The MA transportation program provides transit to medical appointments for those who have no other means of travel.
Find Debt Relief in PA Today
If you’re a Pennsylvania resident struggling with compounding debt, you have options. Avoid scams by researching company reviews and carefully reading the website. Stay diligent about any phone or email contact asking for sensitive information. Once you establish trust, ask questions to ensure transparency and support.
When you’re ready to work with a reputable debt relief organization, get started with a free debt relief consultation from TurboDebt. Our programs can save you money and repair your credit, often in less than five years, when you enroll and make regular payments on your structured debt payoff. Together, we’ll find the best debt solutions to meet your needs and get you back on the road to financial freedom.