Is Your State Financially Distressed? (2026)
Nevada ranks highest on the State Distress Index at 91.3 as of July 2026, with 9 of 51 jurisdictions in the high-distress range. Four-domain composite built from NY Fed, BLS, U.S. Census Bureau, and U.S. Courts data; scores range from 8.7 (North Dakota) to 91.3.
Which States Have the Most Financial Distress?
Nevada has the highest State Distress Index score at 91.3, followed by Louisiana (84.7), Florida (80.1), South Carolina (74.9), and Mississippi (73.7). These five jurisdictions share elevated delinquency rates across credit cards, auto loans, and mortgages. The remaining composition varies meaningfully across the four SDI domains: delinquency, default and legal, debt burden (housing basis), and labor. The composite score points the same direction; the channel through which the score accumulates is not the same across these states. The per-state domain breakdown is published with the interactive state map.
At the other end, North Dakota (8.7), South Dakota (9.4), and New Hampshire (15.6) show the least distress. A 82.6-point gap. Same federal interest rates. Same inflation. Same labor market cycle. The gap is not about the economy getting worse — it is about the economy getting worse in specific places for specific structural reasons. American Default Research publishes the American Distress Index nationally and the State Distress Index for geography, scoring all 51 jurisdictions across four domains of household financial distress.
At a Glance
The national American Distress Index currently reads 43.8 (Typical). On average, its inputs sit higher than in 44% of their own quarterly histories. The national ADI tracks distress over time, ranking each input against its own quarterly history. The State Distress Index compares states to each other at a single point in time, revealing where household distress is concentrating geographically. See the interactive state map for a visual overview, or compare individual state foreclosure timelines alongside their distress scores.
All 51 Jurisdictions Ranked
State Distress Index scores for every state and DC, ranked from highest distress to lowest. Colors track each state's distress score; rank #1 is the most distressed jurisdiction.
State Distress Index Scores — All 51 Jurisdictions
State Distress Index composite
What Is Driving the Highest Distress Scores?
Two states can have similar composite scores but arrive there through different mechanisms. One state can score high because of debt performance. Another because of the labor domain or housing-basis debt burden. The domain breakdown for the top 10 most distressed states shows where each score comes from.
Domain Breakdown — Top 10 Most Distressed States
Domains: Delinquency, Default & Legal, Debt Burden (housing basis), Labor
How Many States Are in Each Score Band?
The State Distress Index is cross-sectional. A mid-scoring state is not being labeled healthy or unhealthy; it is being placed in the middle of the current state distribution. Given that the national ADI reads 43.8, even a median-ranked state may have indicators that look distressed in isolation. Relative positioning and absolute distress are different questions.
Which Regions Have the Most Financial Distress?
Financial distress clusters geographically, which makes sense when you think about the structural factors. The South leads with an average State Distress Index of 64.5 — 6 of 14 states in the high-distress range. The Midwest averages 37.2. These are not random clusters. Southern states cluster high on delinquency and on the courts. The index measures those outcomes; it does not identify what produced them. Lower median wages, thinner household buffers, and differences in state law are all plausible contributors, and separating them takes a study this cross-section cannot stand in for. For a deeper analysis — including the Deep South and Sun Belt corridors — see the State Distress Rankings page.
Average State Distress Index by Region
Regions use Census Bureau definitions · DC included in Northeast
| Region | States | Avg Score | High-Distress | Most Distressed |
|---|---|---|---|---|
| South | 14 | 64.5 | 6 | Louisiana (84.7) |
| Northeast | 12 | 49.6 | 1 | Delaware (70.0) |
| West | 13 | 46.6 | 1 | Nevada (91.3) |
| Midwest | 12 | 37.2 | 1 | Michigan (71.7) |
Which States Score Highest on Each Domain?
Different states struggle on different dimensions. Below are the five highest-scoring states on each State Distress Index domain. A state ranking high on multiple domains suggests broad-based systemic distress; one ranking high on a single domain may have a specific, identifiable vulnerability.
Every number in these four tables is a domain score — where a state sits against the rest of the country on that domain, not the underlying measure itself. A debt-burden score near the top of the scale means a state leads the country on renter cost burden. It is not the share of renters who are burdened.
Delinquency
Credit card, auto, mortgage delinquency
| State | Score |
|---|---|
| Mississippi | 97.7 |
| Louisiana | 95.8 |
| District of Columbia | 93.8 |
| Georgia | 91.2 |
| Alabama | 88.6 |
Default & Legal
Collections and bankruptcy filings
| State | Score |
|---|---|
| Alabama | 96.1 |
| Georgia | 93.1 |
| Louisiana | 89.2 |
| Mississippi | 89.2 |
| Nevada | 88.2 |
Labor
State unemployment rate
| State | Score |
|---|---|
| District of Columbia | 99.0 |
| California | 97.1 |
| Nevada | 93.1 |
| Oregon | 93.1 |
| Washington | 93.1 |
Debt Burden (housing basis)
Severe renter cost burden
| State | Score |
|---|---|
| Florida | 99.0 |
| Nevada | 97.1 |
| California | 95.1 |
| New York | 93.1 |
| Louisiana | 91.2 |
Several Patterns Behind High Scores
The domain columns show several observed patterns among states near the top of this table. Some combine elevated delinquency with default and legal pressure. Mississippi, Louisiana, and Alabama lead on that pair of domains, although this cross-section does not establish that one produces the other. Housing-basis debt burden is prominent elsewhere. Florida and Nevada carry the heaviest severe renter cost burdens in the country: 32.1% and 29.4% of renters whose rent-to-income ratio the Census can calculate hand over at least half their income (2024 American Community Survey, the most recent year published). The labor column provides another distinct contributor. Its highest-scoring rows include District of Columbia, California, and Nevada.
These patterns can overlap but do not coincide, so a state's rank says less than its domain row does. The least distressed states share a different profile: low delinquency, moderate rents against local incomes, and above-average labor markets. Per-state domain breakdowns are on the interactive state map.
Read more: The Two-Economy Problem →Full State Rankings
All 51 jurisdictions with composite score, rank, score label, and four domain scores. Click a state name to see its full distress profile, indicator data, and foreclosure law summary.
| Rank | State | Score | Score Label | Delinq. | Default | Labor | Debt Burden |
|---|---|---|---|---|---|---|---|
| 1 | Nevada | 91.3 | extreme state distress | 86.6 | 88.2 | 93.1 | 97.1 |
| 2 | Louisiana | 84.7 | very high state distress | 95.8 | 89.2 | 62.8 | 91.2 |
| 3 | Florida | 80.1 | very high state distress | 77.5 | 66.7 | 77.5 | 99.0 |
| 4 | South Carolina | 74.9 | high state distress | 86.0 | 56.9 | 73.5 | 83.3 |
| 5 | Mississippi | 73.7 | high state distress | 97.7 | 89.2 | 42.2 | 65.7 |
| 6 | Georgia | 73.0 | high state distress | 91.2 | 93.1 | 26.5 | 81.4 |
| 7 | Michigan | 71.7 | high state distress | 52.6 | 65.7 | 83.3 | 85.3 |
| 8 | Texas | 70.2 | high state distress | 88.6 | 70.6 | 57.8 | 63.7 |
| 9 | Delaware | 70.0 | high state distress | 70.3 | 75.5 | 88.2 | 46.1 |
| 10 | California | 68.8 | moderate-high state distress | 44.8 | 38.2 | 97.1 | 95.1 |
| 11 | New Mexico | 67.6 | moderate-high state distress | 74.2 | 45.1 | 81.4 | 69.6 |
| 12 | District of Columbia | 66.1 | moderate-high state distress | 93.8 | 13.7 | 99.0 | 57.8 |
| 13 | Arizona | 65.2 | moderate-high state distress | 59.8 | 59.8 | 79.4 | 61.8 |
| 14 | Connecticut | 64.9 | moderate-high state distress | 48.7 | 35.3 | 88.2 | 87.3 |
| 14 | Maryland | 64.9 | moderate-high state distress | 68.3 | 63.7 | 59.8 | 67.7 |
| 16 | Illinois | 63.1 | moderate-high state distress | 55.2 | 57.8 | 85.3 | 53.9 |
| 17 | New York | 62.7 | moderate-high state distress | 62.4 | 23.5 | 71.6 | 93.1 |
| 18 | Oregon | 61.8 | moderate-high state distress | 27.4 | 47.1 | 93.1 | 79.4 |
| 19 | Alabama | 61.6 | moderate-high state distress | 88.6 | 96.1 | 11.8 | 50.0 |
| 20 | Kentucky | 61.6 | moderate-high state distress | 65.0 | 87.3 | 65.7 | 28.4 |
| 21 | New Jersey | 60.0 | moderate-high state distress | 48.7 | 40.2 | 75.5 | 75.5 |
| 22 | West Virginia | 57.9 | moderate state distress | 74.8 | 53.9 | 54.9 | 48.0 |
| 23 | Oklahoma | 57.6 | moderate state distress | 79.4 | 78.4 | 48.0 | 24.5 |
| 24 | Arkansas | 57.0 | moderate state distress | 80.1 | 85.3 | 52.0 | 10.8 |
| 25 | Pennsylvania | 56.3 | moderate state distress | 58.5 | 43.1 | 50.0 | 73.5 |
| 26 | Ohio | 54.4 | moderate state distress | 57.8 | 71.6 | 36.3 | 52.0 |
| 27 | Tennessee | 54.2 | moderate state distress | 67.0 | 87.3 | 28.4 | 34.3 |
| 28 | Rhode Island | 51.6 | moderate state distress | 43.5 | 30.4 | 54.9 | 77.5 |
| 29 | North Carolina | 51.4 | moderate state distress | 72.2 | 46.1 | 31.4 | 55.9 |
| 30 | Indiana | 50.1 | moderate state distress | 63.1 | 74.5 | 18.6 | 44.1 |
| 31 | Missouri | 45.0 | moderate-low state distress | 54.6 | 65.7 | 39.2 | 20.6 |
| 32 | Virginia | 44.9 | moderate-low state distress | 44.1 | 53.9 | 39.2 | 42.2 |
| 33 | Washington | 44.9 | moderate-low state distress | 16.7 | 29.4 | 93.1 | 40.2 |
| 34 | Colorado | 43.3 | moderate-low state distress | 33.0 | 34.3 | 46.1 | 59.8 |
| 35 | Massachusetts | 42.6 | moderate-low state distress | 21.2 | 7.8 | 69.6 | 71.6 |
| 36 | Kansas | 38.5 | low-moderate state distress | 42.2 | 54.9 | 44.1 | 12.8 |
| 37 | Hawaii | 32.8 | low-moderate state distress | 26.5 | 10.8 | 4.9 | 89.2 |
| 38 | Minnesota | 32.2 | low-moderate state distress | 8.2 | 31.4 | 62.8 | 26.5 |
| 39 | Idaho | 31.5 | low-moderate state distress | 19.3 | 39.2 | 31.4 | 36.3 |
| 40 | Alaska | 29.3 | low state distress | 21.2 | 23.5 | 67.7 | 4.9 |
| 41 | Iowa | 28.3 | low state distress | 31.7 | 42.2 | 16.7 | 22.6 |
| 42 | Utah | 27.1 | low state distress | 3.6 | 53.9 | 34.3 | 16.7 |
| 43 | Wisconsin | 23.6 | low state distress | 8.2 | 44.1 | 23.5 | 18.6 |
| 44 | Wyoming | 23.5 | low state distress | 24.5 | 42.2 | 20.6 | 6.9 |
| 45 | Maine | 23.5 | low state distress | 22.6 | 26.5 | 14.7 | 30.4 |
| 46 | Nebraska | 21.0 | low state distress | 19.3 | 41.2 | 8.8 | 14.7 |
| 47 | Montana | 18.9 | very low state distress | 16.7 | 26.5 | 23.5 | 8.8 |
| 48 | Vermont | 17.2 | very low state distress | 15.7 | 7.8 | 6.9 | 38.2 |
| 49 | New Hampshire | 15.6 | very low state distress | 7.5 | 10.8 | 11.8 | 32.4 |
| 50 | South Dakota | 9.4 | exceptionally low state distress | 23.9 | 11.8 | 1.0 | 1.0 |
| 51 | North Dakota | 8.7 | exceptionally low state distress | 10.1 | 18.6 | 2.9 | 2.9 |
Frequently Asked Questions
Which state has the highest financial distress?
Nevada has the highest State Distress Index score at 91.3, ranking #1 of 51 jurisdictions and scoring extreme state distress. Louisiana (84.7) and Florida (80.1) round out the top three.
Which state has the lowest financial distress?
North Dakota has the lowest State Distress Index score at 8.7, ranking #51 of 51 jurisdictions and scoring exceptionally low state distress.
How is the State Distress Index calculated?
The State Distress Index is the mean of four equal-weighted domains: delinquency, default and legal, debt burden (housing basis), and labor. Each domain is built from state-level input percentile ranks, with higher values indicating more distress. Data sources include the NY Fed, BLS, the Census Bureau, and U.S. Courts.
How does the State Distress Index differ from the national ADI?
The national ADI ranks each of its inputs against that input's own quarterly history — it tracks how the present compares with the nation's own past. The State Distress Index compares states to each other at a point in time. The national ADI currently reads 43.8 (Typical). On average, its inputs sit higher than in 44% of their own quarterly histories. State scores range from 8.7 to 91.3.
Which region has the highest average financial distress?
The South has the highest average State Distress Index score at 64.5, with 6 of 14 states in the high-distress range. Louisiana (84.7) is the most distressed state in the region. The Midwest averages 37.2.
Data Sources
NY Fed Consumer Credit Panel
State-level credit card, auto loan, and mortgage delinquency rates. Quarterly data from a nationally representative 5% sample of Equifax credit reports.
BLS, Census Bureau, U.S. Courts
State unemployment rates (LAUS), severe renter cost burden (American Community Survey 1-Year, table B25070), and bankruptcy filings per 100K (Administrative Office). Updated monthly or annually.
CFPB, State Statutes, KFF (not SDI inputs)
Mortgage complaint density per 100K, foreclosure legal protections scoring, Medicaid enrollment rates, and HAF program status. These feed the separate state safety-net score shown on each state page, not the State Distress Index.