Georgia Debt Relief: The Tools You Need to Escape the Debt Trap

As of July 2022, 10,912,876 people lived in Georgia. With an average personal income of $53,940 and an average debt load of $53,900, many Georgia residents are struggling with debt. In fact, the state ranks 37th in terms of poverty with 13.3% of the population living below the federal poverty line.

If you’re living in Georgia and need debt relief or other financial assistance, here are your short- and long-term options

Are you eligible for debt relief?

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Georgia debt statistics

When it comes to credit and debt in Georgia, here are some of the latest statistics:

  • Average household debt (debt per capita): $53,900
  • Average student loan debt: $41,639
  • Average credit score: 693
  • Median mortgage payment: $1,383
  • Bankruptcies in 2021: 21,196
  • Personal income/Annual mean wage: $53,940
  • Child poverty: 18.5%
  • Unemployment: 3.0%

Debt collection laws in Georgia

Georgia follows the same consumer protection laws set forth by the Fair Debt Collection Practices Act (FDCPA). The state’s Consumer Protection Division outlines these laws in relation to debt collectors.

In Georgia, debt collectors are prohibited from:

  • Contacting a person who owes a debt (the debtor) at unreasonable times or places
  • Calling a debtor at work when they know they cannot take personal calls
  • Contacting a debtor when you have already told them you have legal representation
  • Using unfair, deceptive, or abusive tactics to collect money
  • Harassing you at home or at work

Debt collectors can still reach out about unpaid debts. They can also sue you if you fail to respond or pay your debts. Additionally, these rules only pertain to personal debts, not business debts.

Debt relief options for Georgia residents

Here are the best strategies for Georgians seeking debt relief:

  • Debt settlement: Debt settlement is when you — or an agency — work with your creditors to reduce how much you owe on an account.
  • DIY plans: Dealing with difficult debt collectors or creditors can be stressful or tedious. But if you’re good at negotiating, you may be able to work with them to lower your monthly payments, settle your debts, waive certain fees, or lower interest rates.
  • Debt consolidation: Debt consolidation loans allow you to combine multiple smaller debts into one loan with a fixed interest rate and monthly payment. If you have good credit, this could reduce how much you pay in interest over time.
  • Debt management plan: DMPs are offered through credit counseling agencies. These three- to five-year plans are designed to help borrowers who are struggling with a lot of debt. With one, you could get a personalized repayment plan or lower interest rates. This could make it easier to manage and repay your debts.
  • Personal bankruptcy: Filing for bankruptcy is a last resort for most people, but it could help if you’ve run out of options. The two most common types of personal bankruptcy are Chapter 7 and Chapter 13. You may only be eligible for one or the other.

To learn more about Chapter 7 bankruptcy in Georgia, check out this video:

Debt settlement in Georgia

One of the more common types of debt relief in Georgia is debt settlement. Debt settlement can work with most unsecured debts, including:

  • Credit cards
  • Personal lines of credit
  • Loans in default
  • Old judgments
  • Store credit cards

Typically, you will work with a debt settlement agency to try to reduce your debts. When successful, you could end up shaving off around 50% — sometimes more — from what you originally owed.

Debt settlement takes around two to four years to complete, on average. During the process, the agency (unless you’re doing a DIY plan) will negotiate with your creditors. While they do this, you’ll need to start making payments into a secured account. Once your creditors agree to settle your debt, the agency will use that account to pay them the remaining balance.

Throughout the debt settlement process, you may be asked to stop making payments on your enrolled accounts. This can increase the success rate, but it can also result in late fees or hurt your credit score.

Debt settlement is a risky process, so it’s only recommended if your other option is bankruptcy.

Georgia debt settlement companies

Need a debt settlement agency in Georgia to help with unsecured debts? Here are your best options:

Debt settlement attorneys

Or, if you’re facing debt settlement or bankruptcy and need legal representation, here are some local attorneys:

Debt resources for Georgia residents facing hardship

In Georgia, there are many debt relief resources and programs available to residents. Some are federally funded, while others are offered at a state or local level. They can help with things like:

  • Rent or mortgage payments
  • Utility bills
  • Education or childcare
  • Medical bills or affordable health insurance
  • Legal expenses

Georgia also offers several food and nutrition programs, including Supplemental Nutrition Assistance Program (SNAP). But when SNAP isn’t enough, the state also has food banks to support the 1,141,880 residents — that’s one in nine residents — facing hunger.

Here are some of the biggest Georgian food banks:

Income and employment in Georgia

Georgia ranks 11th when it comes to job growth with 4,872,000 new jobs (year-over-year). The state’s unemployment rate was 12.3% in April 2020, but it’s dropped to 3.0%. This is lower than the national average.

The Peach State has both right-to-work and employment-at-will laws. This means:

  • Right-to-work: This means that employees can join a union, but they do not have to as a condition of employment. Without union representation, it may be more difficult to fight for fair wages or job security.
  • Employment-at-will: Most employees are considered “at-will” in Georgia, meaning the employer can terminate them for nearly any reason (except for illegal ones). Employers do not have to give notice, which can lead to decreased job security.

Georgia does follow federal guidelines when it comes to job security and wages. For example, an employer must follow what’s written and agreed upon in a job contract (if active and valid).

How to apply for unemployment benefits in Georgia

Georgians needing unemployment benefits can apply on the Department of Labor website. The site provides information about:

  • Unemployment benefits
  • Unemployment assistance (such as how to file)
  • Eligibility for benefits (ex. you must be actively looking for work)

If eligible, head to the MyUI Claimant Portal and either login or create an account. If you don’t have an account, you’ll need:

  • Your Social Security Number (SSN)
  • A device with a camera
  • Government-issued photo ID

Once logged in, follow the prompts to complete an application. You may need:

  • Employment or income information from your previous job or jobs (such as your income amount and why you are currently unemployed)
  • Proof of citizenship or a visa indicating you are legally authorized to work in the United States
  • Other identifying or personal information

You can use the MyUI Claimant Portal to request weekly payments. For more information about eligibility and benefits, refer to the claimant handbook.

Banking and taxes in Georgia

Georgia has a graduated personal income tax. It ranges from 1% to 5.75%, depending on income and filing status. The state also has a 5.75% corporate income tax rate.

Here’s an example of the state’s tax rate. Keep in mind that these numbers are not exact and can change:

  • Amounts over $0 but under $750 = 1% tax rate
  • Amounts over $750 but not over $2,250 = 8% tax rate plus 2% of the amount over the limit
  • Amounts over $2,250 but not over $3,750 = $38 plus 3% of the amount over
  • Amounts over $3,750 but not over $5,250 = $83 plus 4% of the amount over
  • Amounts over $5,250 but not over $7,000 = $143 plus 5% of the amount over
  • Amounts over $7,000 = $230 plus 5.75% of the amount over

In Georgia, 6.7% of residents are unbanked, meaning they have neither a checking nor a savings account. Oftentimes, people who are unbanked end up using alternative forms of credit — like payday loans or cash advance apps — for their financing needs. This can become expensive and, in some cases, lead to a cycle of debt.

Georgia housing market

Approximately 64.7% of Georgia residents are homeowners. The median mortgage payment, according to Rocket Mortgage, is $1,383. In contrast, the typical rent payment in Atlanta, GA is $1,880 for a 970-square-foot apartment.

The cost of real estate has gone up significantly throughout the country these past couple of years. In the United States, the average home value is $357,319, a 10.8% increase over one year. In Georgia, the current average home value is $324,799 — that’s a 14.7% increase over one year.

For homeowners struggling with their mortgage payments, the Georgia Homeowners Assistance Fund could help. This program is designed to help residents avoid mortgage delinquencies, loss of utilities, or foreclosure.

Eligibility primarily depends on income. If eligible, you could receive one-time financial assistance to help you catch up on payments for things like:

  • Utility bills
  • Property insurance
  • Association fees

To learn more about the program or apply, go to the Department of Community Affairs. You’ll need to complete several forms. You’ll also need to show proof of income, proof of hardship, and that you own the property.

Retirement in Georgia

On average, Georgia residents have about $435,254 set aside for retirement. To live comfortably during retirement, they should have closer to $570,767 saved up.

Average Georgia insurance premiums

The average car insurance premium (full coverage) in Georgia is $2,009 annually. Car insurance rates depend on things like the driver’s age, credit, and driving history.

Meanwhile, the average homeowner insurance premium is $1,373 a year for $250,000 dwelling coverage. This is on par with the national average.

Payday lending status in Georgia: Prohibited

Payday loans are illegal in many parts of the United States, including Georgia. However, some lenders still offer small loans. These usually have the following rates and terms:

  • Maximum loan amount: $3,000
  • Maximum Interest Rate (APR): 10%
  • Minimum loan term: N/A
  • Maximum loan term: 36 months and 15 days

Statute of limitations on debt in Georgia

Georgia’s statute of limitations on debt ranges from four to seven years (depending on debt type):

  • Credit card debt: 4 years
  • Auto loan debt: 4 years
  • Medical debt: 6 years
  • State tax debt: 7 years      

State hardship programs

Here are Georgia’s top state hardship programs. Some of these are also offered at the federal level:

  • Affordable Housing: This resource connects Georgia residents with various affordable housing options in the state, including low-cost rental housing. One program, the Georgia Dream Homeownership Program, even offers mortgage financing to those who qualify.
  • Single Family Housing Repair and Grants Program: The Section 504 Home Repair program helps homeowners fix or upgrade their home through a low-cost loan. It’s geared toward the elderly and low-income households.
  • Low-Income Home Energy Assistance Program: LIHEAP helps low-income households through payment assistance (energy bills). To be eligible, you’ll need to have a total gross annual income equal to or lower than 60% of the median income within Georgia. You can find more information here.
  • Low-Income Household Water Assistance Program: This program helps residents afford safe drinking water. It also helps with wastewater costs.
  • Children’s Peachcare Program: Peachcare is designed to help children who need affordable health insurance. It’s similar to the Children’s Health Insurance Program (CHIP). Eligibility is primarily based on income and residency.
  • Georgia Childcare Program: Georgia has several childcare programs, such as Childcare and Parent Services (CAPS). This program helps families with childcare-related costs through financial assistance.
  • Supplemental Nutrition Assistance Program: SNAP provides low-income families with cash assistance to help with food costs.
  • Combined Application Project: This project makes it easier for Georgians seeking several forms of financial aid to apply at once.
  • WIC: The Women, Infants, and Children Supplemental Nutrition Program helps low-income women with children through nutrition information, breastfeeding support, and access to low-cost, healthy food. It can also help eligible residents find community assistance or health insurance.
  • Homeless Housing: This resource offers resources to help those facing homelessness.
  • Organization for Refugees & Immigrants: The goal of this program is to help refugees gain self-sufficiency in the state. This can be through job development, training, and other resources.
  • Temporary Assistance for Needy Families: TANF works with low-income families by providing them with cash assistance each month.

Help for Veterans

The Peach State is home to 609,508 veterans or 7.6% of the state’s population. Georgia’s Department of Veteran Affairs offers several types of assistance to veterans and their families. This includes counseling, education and training, medical assistance, and more.

Facilities in Georgia

Here are some of the top VAs in Georgia:

  • Albany VA Clinic: 1303 W. Broad Ave Albany, GA 31707; (229) 430-1797
  • Athens VA Clinic: 9249 U.S. Highway 29 Athens, GA 30601; (706) 369-5630
  • Augusta VAMC: 950 15th St. Augusta, GA 30901; (706) 733-0188, ext. 32336
  • Columbus VA Clinic: 2100 Comer Avenue Suite 100A Columbus, GA 31904; (706) 649-1265
  • Macon VA Office: 5566 Thomaston Road Macon, GA 31201; (478) 476-8868
  • Savannah VA Office: 1170 Shawnee St Savannah, GA 31419; (912) 920-0214
  • Warner Robins VA: 1001 S. Armed Forces Blvd. Warner Robins, GA 31088; (478) 218-3906

Employment resources for Veterans

The Georgia Department of Labor connects veterans to different employment initiatives, such as Vets to Cops and Troops into Transportation. Along with these resources, here are a few others for veterans and their families to consider:

  • My Next Move helps veterans find a job in the civilian workforce.
  • MilitaryHire.com, an online platform, gives veterans a place to post their resumes and apply for civilian jobs.
  • CareerOneStop helps veterans through financial assistance, job training, and looking for work.
  • VeteranRecruiting.com works with veterans and their families by helping them find employment opportunities. It also has an online recruitment center and virtual career fairs.
  • Hiring Our Heroes is a national program that helps veterans through networking and job training.
  • Helmets to Hardhats connects veterans and other military personnel with work in the construction industry.
  • Warriors to Work helps veterans through career counseling, resume help, and more.

The bottom line

For Georgians seeking debt relief, there are options. This includes credit counseling, debt consolidation, debt settlement, and legal assistance. The state also provides short-term financial assistance programs to low-income families who need help getting back on their feet. Knowing your options can help you get your finances on track and get a handle on your debts.

FAQs

How long can a debt be collected in Georgia?

Generally, a debt collector can take you to court for six years on written debts (like credit cards). For oral debts, this time is reduced to four years.

When does the statute of limitations begin in Georgia?

The statute of limitations on most debts starts on the date the debt was last paid.

Am I responsible for my spouse’s debt if I get divorced in Georgia?

In Georgia, all assets and liabilities (debts) are subject to equitable distribution. Assets or debts acquired before the marriage are the responsibility of the original owner. Anything gained during the marriage is generally considered marital debt and could be the responsibility of both spouses upon divorce.

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