Debt dilemma

This is how many Dallasites max out their credit cards, new study says

This is how many Dallasites max out their credit cards, new study says

wallet with credit cards
Dallas is No. 43 in a recent study about credit card debt. Photo courtesy of Local Government Federal Credit Union

When it comes to maxing out credit cards, some Dallasites are pushing the limits. A study published October 22 by LendingTree’s CompareCards website finds that Dallas ranks 43rd among the top 100 U.S. cities for residents who've pushed their credit to the max.

For its study, CompareCards analyzed an anonymized sample of credit reports from 1.3 million My LendingTree users with active credit cards.

In Dallas, 25.2 percent of credit card holders have maxed out at least one card, meaning the balance is at least equal to the credit limit, according to CompareCards; 8.7 percent  have two or more maxed-out cards.

report released November 4 by Experian, one of the major credit bureaus, shows the average credit card debt in the Dallas metro area stood at $7,291 in the second quarter of this year, up 1.8 percent from the same period in 2018. That put it in eighth place for the highest amount of credit card debt among major metro areas.

“The truth is that life is expensive in 2019,” says Matt Schulz, chief industry analyst at CompareCards, “and when you’re struggling to bring in income, sometimes you have to lean on credit cards to get by.”

Schulz points out that lower-income consumers tend to have credit cards with relatively low credit limits, making it easier for them to max out their cards.

The news is worse elsewhere in Texas. San Antonio ranks seventh among U.S. cities for residents who’ve pushed their credit to the max.

In the Alamo City, 29.2 percent of credit card holders have maxed out at least one card. Eleven percent have two or more maxed-out cards. The Experian report shows the average credit card debt in the San Antonio metro area stood at $7,210 in the second quarter of this year, up 2.6 percent from the same period in 2018. That put it in 10th place for the highest amount of credit card debt among major metro areas.

“The biggest reason for San Antonio appearing near the top of the list is probably income,” says Schulz. “Even as much as San Antonio has boomed and grown in recent years, the average income there is still among the lowest of all big American cities.”

Houston ranks 13th nationally for the share of cardholders with at least one maxed-out card (28.4 percent). Ten percent have maxed out two or more cards.

Austin lands at No. 66 (23.6 percent) on CompareCards’ list. The study indicates 7.6 percent in Austin have maxed out two or more cards.

At the top of the heap for maxed-out cardholders is Bridgeport, Connecticut, where 32.3 percent of consumers have maxed out at least one card, CompareCards says. In addition, 10.4 percent have maxed out two or more cards. Not surprisingly, cardholders in the Bridgeport metro area carried the highest average credit card debt in the U.S. during the second quarter of this year ($8,679), according to Experian.

The place with the lowest share of maxed-out cardholders is Provo, Utah, according to the CompareCards study. There, 17.9 percent of cardholders have maxed out at least one card, and 6.1 percent have two or more maxed-out cards.