Americans are accumulating more debt, particularly around student loans, but borrowers in some states are struggling more than others to pay back these loans on time.
Overall, about 44.7 million people have student loans in the U.S. — that adds up to $1.5 trillion in debt and breaks down to roughly $32,731 per person. But while studies show those with a college degree have higher earning potential, this type of debt has the highest delinquency rate in the country, ahead of credit cards, auto loans and mortgages: 9.23 percent.
Delinquency rates vary considerably by state, though. To find out which states had the highest and lowest delinquency levels, finance site Credit Sesame used data from the Federal Reserve Bank of New York's report State Level Household Debt Statistics. The delinquency rate is based on the share of loans that are over 90 days overdue.
Where repayment is hardest
Mississippi and West Virginia have the highest student loan delinquency rates in the U.S. at 16.84 percent and 16.38 percent, respectively.
Residents of these states don't have the largest amounts of student debt in the country. About 60 percent of college graduates in Mississippi have student loans totaling an average of $29,384 per person, according to the Institute for College Access and Success's 12th Annual Student Debt report. Similarly, in West Virginia, about 77 percent of graduates have student debt that averages out to $27,708 per person.
Meanwhile, nearly 75 percent of college graduates in New Hampshire have outstanding student loans and owe an average of $36,367 each. Pennsylvania, Connecticut, Delaware, Minnesota and Massachusetts round out the top six states with the highest average amount of undergraduate student debt: Recent grads in these states carry over $31,500 on average.
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The delinquency rates in those states, however, aren't as high, possibly because salaries for college graduates tend to be more generous in the Northeast.
Why repayment and delinquency rates matter
A loan becomes delinquent the first day after you miss a payment and stays that way until the past-due balance is repaid or your payment plan is adjusted, according to the U.S. Department of Education. Once your payment is 90 days late, the delinquency is reported to the three major credit bureaus. After 270 days, the loan goes into default.
Typically, a late payment notification appears when a payment is a full 30 days late, according to author and educator John Ulzheimer. "Consumers with good credit scores tend to get cards with higher initial limits and larger limit increases. That allows them to have higher balances while also having higher scores," Ulzheimer says.
Failing to stay on top of student loan payments can have dire implications for your ability to get a mortgage, a loan or a credit card at a good interest rate, or at all, since payment history is the most important factor used to determine your credit score.
In some cases, a history of late payments can affect your ability to find a place to live. If you rent, for example, a low credit score may prevent your application from going through. Rental site StreetEasy recommends having a credit score in the "fair" range of 620-659 or better.
If you're looking to improve your credit score, the fastest way to do so is by making timely payments going forward. You can also address some of the other key factors used to calculate your credit score: missed payments, personal bankruptcies and high credit-card balances. Most experts recommend that you spend less than 25 percent of your credit limit.
"Get educated and be patient," Jeff Richardson, spokesman for credit score company VantageScore Solutions, tells CNBC Make It. "It's a marathon, not a sprint."
And if you have defaulted on your student loans, here's how to get back on track.
Don't miss: This map shows where Americans have the highest, and lowest, credit scores
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