Study: Nevada leads nation in debt delinquency - WNEM TV 5

Study: Nevada leads nation in debt delinquency

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Several common credit cards appear in this undated file image. (File/FOX5) Several common credit cards appear in this undated file image. (File/FOX5)

A new study from the Urban Institute shows Americans are increasingly bracing for calls from collection agencies.

The study show one in three Americans with a credit history have accounts in collection. The average debt is about $5,200 per person. In Nevada, it's more than $7,000 per person.

Nevada sits at the top of the list. In Las Vegas alone, 49 percent of residents have debt that has gone into collection.

Las Vegan Valerie Livengood said bad choices when she was younger and ignored medical bills put black marks on her credit report.

"About a year ago, my husband and I were looking at purchasing new vehicles and wanting to move, and we took a look at our credit score and we were like, ‘Wow!'" Livengood said.

Livengood turned to Credit Restoration of Nevada for help.

"Within our company, 70 percent of what we do is deal with collections," said Credit Restoration of Nevada Chief Executive Officer Harry Jacobs.

Jacobs said a lot of Nevadans struggle with confusing medical bills.

"Doctors' offices are notoriously quick to send to collections if you don't pay right away or are confused by it [the bill]," he said.

Jacobs said some collectors won't contact you right away. If you do receive collection calls, you are protected under the Fair Debt Collection Act.

For instance, you can request collectors only contact you in writing and that you want your outstanding debt validated.

"Within five days, they're supposed to provide documentation of that. If there's an issue, you have time at that point. Generally, it's 60 days before something drops on your report," Jacobs said.

Once debt goes into collection, it can stay on your credit report for seven years, even if it's paid off.

Jacobs said it's important to tackle the problem immediately because a poor credit rating can affect your chances of getting a home loan or even a job. You'll also pay more for insurance.

You can get free credit reports from each of the three bureaus here.

Copyright 2014 KVVU (KVVU Broadcasting Corporation). All rights reserved.

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