Houston households are lugging around a hefty load of nonmortgage debt, with the average resident on the hook for $44,640 in balances that have nothing to do with a home loan. That includes car notes, student loans, credit cards and personal loans, and it is a strong sign that everyday living costs are biting hard across the metro.
Study Finds Houston Near the Top
According to LendingTree, Houston ranks third among the 50 largest U.S. metros for nonmortgage debt. Residents here carry an average of $44,640 in nonmortgage balances, trailing only Austin at $45,920 and San Antonio at $44,812. Across those big metros, the typical resident carries $37,827 in nonmortgage debt, which leaves Houston roughly $7,000 above the pack.
How Houston's Debt Breaks Down
The breakdown of that debt shows auto loans take the biggest bite out of Houston wallets: the average resident has about $16,357 in auto loan debt, $12,556 in student loans, $8,583 in credit card balances and $4,473 in personal loans, according to Click2Houston. The local outlet also reports that nearly 98% of Houston-area residents carry some form of nonmortgage debt.
National Context
Those eye-catching metro numbers are landing at the same time total U.S. household debt has climbed to about $18.8 trillion, according to the Federal Reserve Bank of New York's Quarterly Report on Household Debt and Credit. The New York Fed says balances rose modestly in the most recent quarter and flags particular strain among younger and lower-income borrowers, a pattern that makes high-debt regions like Houston feel even more precarious.
Why Texas Metros Rank High
LendingTree points to a few Texas-specific forces that help shove its metros toward the top of the rankings. Chief among them is the heavy reliance on cars, which feeds larger auto-loan balances. Layer on rising everyday expenses in fast-growing cities and it becomes easier to see why Austin, San Antonio and Houston all crowd the upper tier of nonmortgage debt.
What Houstonians Can Do
Consumer advocates say the worst move is to ignore the bills and hope they magically disappear. Instead, they recommend starting with a realistic budget, calling lenders to ask about hardship programs or lower interest rates, and turning to nonprofit credit counseling if the numbers still do not work. As Click2Houston reports, KPRC consumer reporter Bill Spencer said, "These firms will create a budget for you, put you on a path to recovery and help lower interest rates for you."
Where to Get Help
National nonprofit networks such as the National Foundation for Credit Counseling offer free or low-cost consultations and debt-management programs that can consolidate payments and negotiate with creditors. Homeowners, or anyone seeking HUD-approved housing counseling, can use the locator tools and complaint resources on the Consumer Financial Protection Bureau website.
