Debt Relief California

As with most states across the country, California was heavily affected by the pandemic. Though the state is seeing an uptick in job openings in various sectors, California ranked 26th in average credit card debt by state with an average debt of $5,120 held in 2020. But by 2021, California ranked in at 1st place when it came to credit card debt increasing in Q2 2021. And with an ever-increasing cost of living, finding ways to decrease debt has become more and more difficult.

“Rising rent and housing prices are crippling California residents who are already struggling to meet their credit card payments,” says Gary Herman, President of Consolidated Credit. He continues, “And with the high unemployment rate in the state it is becoming even more difficult for people to decrease or even maintain their level of debt.”

Consolidated Credit Helps California Residents Reduce Their Total Credit Card Payments by Up to 50%

By submitting your information above, you consent, acknowledge, and agree to the following: Our Terms of Use and Privacy Policy. That you are providing express "written" consent for Consolidated Credit Solutions, Inc to call you (autodialing, text and pre-recorded messaging for convenience) via telephone, mobile device (including SMS and MMS - charges may apply depending on your carrier, not by us), even if your telephone number is currently listed on any internal, corporate, state or federal Do-Not-Call list. We take your privacy seriously and you may receive electronic communications, including periodic emails with important news, financial tips, tools and more. You can always unsubscribe at any time. Consent is not required as a condition to utilize Consolidated Credit Solutions, Inc services and you are under no obligation to purchase anything.

Consumer Debt in California

 

This chart shows a breakdown of average consumer debt in California based on the latest report of Household Debt report from the Federal Reserve.

In 2020, 69,432 Californians filed for bankruptcy.

Income and employment in California

California is not a right-to-work state. This means that union dues are mandatory for employment, which remains the case even when the employee is not part of a union.

With one of the highest rates of unemployment in the country, California’s unemployment rate stands at 7.6 percent—down 8.4 percentage points from peak unemployment of 16 percent in April 2020. Only Nevada has higher unemployment with a 7.7 percent unemployment rate.

Apply for unemployment benefits in California»

However, California’s leisure and hospitality sectors added 558,500 jobs between April and July of 2021 making it one of the faster-growing sectors of the California economy. The state’s most projected job openings range from registered nurses to heavy and tractor-trailer truck drivers as well as retail salespersons and waiters and waitresses.

Banking and taxes in California

California’s income tax rates range between 1-13.3% and a state sales tax of 6%. California also allows local governments to collect a local sales tax of up to 3.5%. Therefore, when combined with the state sales tax, California’s highest sales tax rate is 10.75% in cities like Hayward, San Leandro, Alameda, Union City and Neward. The average sales tax runs to about 8.492%.

The average Californian is more likely to bank than the average American. The percentage of residents without a checking or savings account stands at 5.6% currently.

California Housing Market

While the extremes of California’s housing crisis have been concentrated in the Bay Area and in Los Angeles, in actuality the challenges are statewide. Cities like Sacramento and Fresno have been experiencing increases in average rental prices yearly.

Take, for example, the median price of an existing single-family house in 202, which is expected to reach up to $795,600. That is a 20.7% increase from the 2020 median price; a $136,000 increase from last year.

California does offer a homestead exemption, which can range from $300,000 to $600,000.

  • 8% of California residents are homeowners
  • Median mortgage payment: $2,282
  • Median rent payment: $1,503

California has an emergency rental assistance program for renters facing difficulties making rental payments. Additionally, California offers assistance with mortgage relief.

Retirement in California

California has adopted ancient Greek polymath Archimedes’s exclamative point, “Eureka!” as its motto. Arguably that exclamation comes post-realization that the average Californian must move in order to live comfortably after retiring. The average Californian has about $428,437 saved for their retirement when in reality one needs to have around $1.5 million saved up to retire comfortably in the state.

California has seen an increase of nearly 15% in the state’s population. On top of that, the 65 and older population of California grew by 3% in 2019 alone. It is expected that most homeowners will sell, downsize and relocate to a home of equal or lesser value. Historically, retirees have traded in California for states that are more relaxed and have a lower cost of living, such as Florida, Texas or Arizona. Furthermore, about 22% of retirees rely on Social Security for about 90% of their income.

Average California insurance premiums

With the average auto insurance premiums of $1,966 per year, as well as California technically not being a no-fault state, driving in California can be very expensive. Drives in California still retain their right to sue for any additional damages.

On the one hand, homeowner’s insurance rates are somewhat more affordable at a rate of $1,031 annually. On the other hand, the average health insurance premium comes up to $7,056, which is higher than the national average.

Helpful resources for Californians facing hardship

Food Insecurity

City/Region Food Bank Phone Number Address
Los Angeles &

Long Beach

Los Angeles Regional Food Bank 323-234-3030 1734 E. 41st Street, Los Angeles, CA 90058
San Francisco SF-Marin Food Bank 415-282-1900 900 Pennsylvania Avenue, San Francisco, CA 94107
San Diego Feeding San Diego 858-452-3663 9477 Waples Street, Suite 100, San Diego, CA 92121
Sacramento Placer Food Bank 916-783-0481 8284 Industrial Ave, Roseville, CA 95678
San Bernardino &

Riverside

Feeding America Riverside San Bernardino Counties 951-359-4757 2950 – A Jefferson Street, Riverside, CA 92504
Bakersfield Central California Food Bank 559-237-3663 4010 E. Amendola Ave., Fresno, CA 93725
Oakland Alameda County Community Food Bank 510-635-3663 7900 Edgewater Drive, Oakland, CA 94621

Veterans

As of 2019, California was home to 1,574,531 Veterans. These resources are available to help Veterans that are facing unemployment, homelessness, and other hardships.

U.S. Department of Veterans Affairs | CA

California Department of Veterans Affairs (CalVet)

Toll-Free: 800-952-5626

1227 O Street, Sacramento, CA 95814

Helpful employment resources for Veterans:

How Consolidated Credit helps California residents find debt relief

In 2020, Consolidated Credit provided free credit counseling services to 25,932 credit users in the state of California. Of those, 1,562 went on to consolidate their debt with our help through a debt management program. The others received a free debt analysis and complementary budget evaluation, and they were directed to the right solution for their situation to get out of debt as quickly as possible.

Relief options to consider if you’re in debt in California

If you have good credit and need to pay off credit card debt and other non-secured debts, a debt consolidation loan is an excellent option for you. By having good credit, you’ll get a low-interest rate for a loan that refinances all of your debt with one monthly payment. This will help you get out of debt faster, and you may wind up paying less each month. This is an excellent solution for California State residents with high debt and a good credit score.

Californian homeowners may qualify for a home equity loan or a home equity loan of credit, also called a (HELOC). These types of loans use the equity in your home. Due to rapid home value increases, many residents have equity in their homes. The loan allows you to borrow against the equity in your home and pay off credit cards and other debt. This is not a step to take lightly because you could lose your home in foreclosure if you can’t make the payments. If you are considering borrowing against your home, call 1-800-435-2261 to speak with a HUD-certified housing counselor to make sure this is a safe option for you.

Consolidated Credit helps California residents with counseling programs that identify the best way to get out of debt after considering their situations. California residents can get a confidential debt and budget evaluation from a certified credit counselor. Afterward, the counselor will go over the available options and which course of action best meets a person’s needs and goals.

In California, as in other states, it’s best to avoid bankruptcy. If you can afford to repay all that you owe to avoid credit damage but can’t do it on your own, a debt management program can help. You enroll through a credit counseling agency. The agency will work with your creditors to reduce or eliminate interest and work out an affordable repayment schedule. Qualifying Californians can get out of debt in 36-60 payments, on average.

Another option for California residents is debt settlement. With debt settlement, you settle your debt independently or with the help of a debt settlement company. In this program, you agree to pay your creditors a portion of what is owed. This will damage your credit rating because you are not paying on the terms you first agreed to. Missed payments, which are often caused by this type of program, will hurt your credit rating for seven years. Even with those negatives, this can be an excellent program for California residents with overwhelming debt. It can help you avoid bankruptcy.

If you’re curious how we can help you, below, you will find a few case studies from clients that we’ve helped in California. If you’re facing challenges with debt, call us at 1-888-294-3130  to receive a free debt and budget evaluation from a certified credit counselor.

Denise from Valencia, CA

I consolidated my credit cards so fast and efficiently with this program. Consolidated Credit made it all so easy!

Where she started:

  • Total unsecured debt: $17,196.00
  • Estimated interest charges: $9,052.90
  • Time to payoff: 10 years, 4 months
  • Total monthly payments: $687.84

After DMP enrollment:

  • Average negotiated interest rate: 8.56%
  • Total interest charges: $2,557.55
  • Time to payoff: 3 years, 8 months
  • Total monthly payment: $451.00
Time Saved:
6 years, 8 months
Monthly Savings:
$236.84
Interest Saved:
$6.495.35
Eric from Whitier, CA

I’m very satisfied with the service. The payments are always made on time and the APR reduced significantly!

Where he started:

  • Total unsecured debt: $10,525.00
  • Estimated interest charges: $6,188.51
  • Time to payoff: 13 years, 8 months
  • Total monthly payments: $421.00

After DMP enrollment:

  • Average negotiated interest rate: 2.00%
  • Total interest charges: $542.18
  • Time to payoff: 5 years
  • Total monthly payment: $185.00
Time Saved:
8 years, 8 months
Monthly Savings:
$236.00
Interest Saved:
$5,646.33
Maria from San Mateo, CA

I’m very happy with these services – it’s quick and easy to setup. The counselors are very professional and make it comfortable to transition into this program.

Where she started:

  • Total unsecured debt: $74,451.00
  • Estimated interest charges: $43,657.83
  • Time to payoff: 18 years, 8 months
  • Total monthly payments: $2,978.04

After DMP enrollment:

  • Average negotiated interest rate: 7.96%
  • Total interest charges: $18,090.40
  • Time to payoff: 5 years
  • Total monthly payment: $1,539.00
Time Saved:
13 years, 8 months
Monthly Savings:
$1,439.04
Interest Saved:
$25,567.43