7. Kentucky
> Share with debt in collections: 41.9%
> Avg. debt in collection: $4,420 (9th lowest)
> Median household income: $41,724 (5th lowest)
> Poverty rate: 19.4% (5th highest)

Low incomes may have contributed to the credit problems many Kentucky residents face. The median household income in the state was just $41,724 in 2012, fifth-lowest in the nation, while 19.4% of residents lived below the poverty line, the fifth-highest rate in the U.S. Kentucky is among the states that made the most progress in raising the number of residents with a bank account. From 2009 to 2011, the percentage of households without a bank account declined from 12.0% to 9.9%, dropping the state from second to 11th highest in the nation. Yet, many Kentucky residents still lack strong credit. According to figures from Credit Karma, while residents had some of the lowest totals of overall debt, on average they had among the worst credit scores in the country.

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6. Georgia
> Share with debt in collections: 42.0%
> Avg. debt in collection: $4,649 (14th lowest)
> Median household income: $47,209 (20th lowest)
> Poverty rate: 19.2% (6th highest)

Georgia residents were among the least likely Americans to have a bank account. As of 2011, 11.5% of state households were unbanked, more than in all but a few other states. Additionally, 19.2% of the state’s residents lived in poverty in 2012, among the highest rates in the nation. Poor household finances also extended to families that had access to credit as 42% of all residents had debt in collections. One problem facing many residents may be a lack of job opportunities. The state’s unemployment rate of 8.2% in 2013 was among the nation’s highest.

5. Louisiana
> Share with debt in collections: 43.8%
> Avg. debt in collection: $4,194 (the lowest)
> Median household income: $42,944 (8th lowest)
> Poverty rate: 19.9% (3rd highest)

An average Louisiana borrower had a debt of just $4,194 in collection, the lowest nationwide. Financial distress, however, is widespread. Nearly 44% of Louisiana residents with credit histories had debt in collection last year, fifth most nationwide. Poor wages are likely one contributor. Nearly one in five residents lived in poverty in 2012, more than in all but two other states. Louisiana residents have lower-than-average credit card debts and smaller mortgages, but take out larger loans for automobiles compared to most Americans. The average Louisianian had nearly $9,000 in auto debt last year, more than in all but a handful of states.