By Matthew Holloway |
Arizona households are carrying higher debt, seeing declining credit scores, and falling behind on payments at rates above the national average, according to a new analysis from the Common Sense Institute of Arizona (CSI).
The report, which examines credit data and financial trends, found that Arizona’s average credit score dropped by seven points in 2025, placing the state 30th nationally with an average score of 666.
The findings also show long-term growth in household debt. Since 2003, per capita debt in Arizona has increased by 129%, reaching approximately $74,000—one of the largest increases among U.S. states.
Across major categories, Arizona borrowers carry higher balances than the national average. Mortgage debt per capita is 22% higher, while auto loan balances are 7% higher and credit card debt is 8% higher, according to the report.
Missed payments are also more common in Arizona. The report found higher delinquency rates at multiple stages, including accounts 30, 60, and 90 days past due, as well as higher levels of derogatory marks on credit histories compared to national benchmarks.
The analysis also includes a measure of “Household Liquidity Resilience” that assesses households’ ability to withstand financial stress. By that measure, Arizona households are estimated to be 23% less prepared for financial disruptions than the national average. The report identifies the source of this unreadiness emerging from “generally higher than average debt, higher change of delinquency, and a lower cash cushion than the average U.S. household.”
Zach Milne, senior economist at CSI, said the data reflects ongoing financial strain tied to rising costs and borrowing conditions.
“Arizona households are facing residual financial pressure from post-pandemic inflation on top of higher borrowing costs, which continue to strain budgets,” Milne said. “Declining credit scores, rising delinquency rates, and above-average debt levels all point to broader affordability challenges across the state.”
He added, “As households absorb higher costs for housing and other essential expenses, many are becoming more vulnerable to financial shocks and less financially resilient.”
The report compares Arizona’s credit and debt trends to national data, highlighting differences in borrowing levels, repayment patterns, and financial stability indicators.
Matthew Holloway is a senior reporter for AZ Free News. Follow him on X for his latest stories, or email tips to Matthew@azfreenews.com.
