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DebtHammer's free guide to debt relief details several options for North Carolina residents, including hardship programs, consolidation and other financial resources.

Debt Relief in North Carolina

You may be one of the many North Carolinians that qualify for debt relief. Find out today!

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Looking for debt relief in North Carolina? You’re not alone.

North Carolina is home to about 10,551,162 people, many of whom struggle financially. The average personal income is $53,100, roughly $17,000 below the national average. Along with this, the state ranks 40th in terms of poverty rate at 13.6%, which is 2% higher than the national average.

In North Carolina, the total debt per capita (amount of debt per resident in the state) is $51,130. This is slightly below the state’s average personal income of $53,100.

These figures are all only part of the bigger picture. If you’re struggling to make ends meet or pay down debt, these resources could help.

Are you eligible for debt relief?

If you’re a North Carolina resident, DebtHammer may be able to help.

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North Carolina debt statistics

Here are several recent debt and credit statistics in the Tar Heel State:

  • Average household debt (debt per capita): $51,130
  • Average student loan debt: $37,721
  • Average credit score: 707
  • Median mortgage payment: $1,290
  • Bankruptcies in 2021: 6,480
  • Personal income/Annual mean wage: $53,100
  • Child poverty: 19.3%
  • Unemployment: 3.9%

Debt relief options for North Carolina residents

If you’re seeking debt relief in North Carolina, here are the best options:

  • Debt settlement: Debt settlement is the process of reducing your principal debt down for less than what you owe. Most people do it through a licensed debt settlement company.

READ MORE: Best debt settlement companies in your area

  • Debt consolidation: A debt consolidation loan lets you combine several smaller, high-interest debts into one. The new loan comes with one fixed monthly payment and, depending on your credit score, could come with a lower interest rate.
  • Debt Management Plan (DMP): Credit counseling agencies sometimes offer three- to five-year plans (DMPS) to help people struggling with large amounts of debt. With a DMP, you may be able to reduce interest rates or create a customized payment plan to make it easier to manage debt payments.
  • DIY plans: When debt collectors are harassing you, you could try negotiating with them. Depending on your situation, they may lower interest rates, waive late fees, reduce monthly minimums, or even settle your debt for less.
  • Personal bankruptcy: Individuals may file for either a Chapter 7 or Chapter 13 bankruptcy, depending on their circumstances. This is typically considered a last resort, so speak with a bankruptcy attorney before filing.

Debt settlement in North Carolina

A debt settlement plan may be right for you if you:

  • Struggle to keep up with multiple monthly payments
  • Can’t afford regular bills
  • Regularly use expensive forms of credit like payday loans or credit cards

Debt settlement could help you pay off different unsecured debts, including:

  • Lines of credit or credit cards
  • Department store cards
  • Personal loans
  • Old judgments
  • Student loans in default

When you go through an agency, debt settlement usually takes between two and four years to complete. During this time, the agency may advise you to stop making payments on your enrolled debts. This could lead to late payments or damage your credit, but it could also increase the chance of success.

Creditors are not required to settle your debts, so this process isn’t a guarantee. When it’s successful, your creditors will agree to accept a payment smaller than the amount you originally owed. This can make it easier to pay off the remaining debts and get back on track.

READ MORE: How does debt settlement work?

North Carolina debt settlement companies

These North Carolina debt settlement companies may be able to help you find debt relief sooner than if you were to go it alone:

  • InCharge Debt Solutions: 5750 Major Blvd Ste 300, Orlando, Florida, 32819; (866) 914-1369
  • Pacific Debt Relief: Pacific Debt Relief 750 B Street Suite 1700 San Diego, CA 92101; (833) 865-2028
  • MoneyFit: 6213 N. Cloverdale Rd. Suite 100 Boise, ID 83713; (800) 432-0310

READ MORE: Best debt settlement companies

Debt settlement attorneys

Here are some highly-rated debt settlement attorneys in North Carolina:

  • Blossom Law: 301 S Mcdowell St Suite 1103 Charlotte, NC 28204; (704) 256-7766
  • Saffa Law Firm: 5960 Fairview Rd Suite 400, Charlotte, NC 28210; (704) 710-8182
  • Law Offices of John T. Orcutt: 2215 Nash St N, Wilson, NC 27896 or 6616 Six Forks Rd #203 Raleigh, NC; (252) 234-9194 or (919) 847-9750

READ MORE: Debt settlement attorneys: Do you need one?

Debt resources for North Carolina residents facing hardship

North Carolina offers many debt relief resources and programs, which are state or federally funded. These include help with:

  • Rent or mortgage payments
  • Utility bills
  • Healthcare
  • Childcare
  • Food and nutrition

State hardship programs

If you’re looking for state-specific hardship programs to help keep you afloat — or get you back on track financially — here are a few that can help:

  • HOPE Housing Program: The Housing Opportunities and Prevention of Evictions Program was designed to help low-income renters who were impacted by COVID-19. The program’s application period is now closed (as of December 17, 2021).
  • Crisis Intervention Program: This program is designed to help low-income households dealing with a heating or cooling-related crisis.
  • Single Family Housing Repair and Grants Program: Also referred to as the Section 504 Home Repair program, this resource helps very low-income homeowners afford housing-related repairs and modernize their homes.
  • Low Income Home Energy Assistance Program (LIHEAP): This federally funded program offers financial relief to low-income individuals who need help paying their heating bills.
  • Food/Nutrition Services: North Carolina offers financial assistance for food and nutrition up to a certain amount based on gross income and household size. One such program is the Supplemental Nutrition Assistance Program.
  • Financial Assistance — Short Term: Work First is the state’s version of the TANF (Temporary Assistance for the Needy Families) program. The program helps families support themselves and their children through job-related training and other resources to help with employment.
  • Children’s Health Insurance Program (CHIP): CHIP is intended to help families with children access affordable healthcare. It’s for low-income households who qualify based on an assessment by a DSS caseworker.
  • WIC: The Special Supplemental Nutrition Program for Women, Infants, and Children (WIC) is funded by the U.S. Department of Agriculture. This program helps families with young children access affordable, nutritious food and education resources.
  • Council For Women Grants: The CFWYI CARES act was established during the COVID-19 pandemic to provide emergency grants to North Carolina’s domestic violence centers and sexual assault programs.
  • Organization for Refugees & Immigrants: This resource provides a wide range of programs, ranging from refugee public assistance to service programs. These programs can help people learn English, find work, and more.

Food assistance

In the Tar Heel State, one in eight people — approximately 1,245,870 residents — are facing hunger. About 394,300 of these people are children.

The Feeding the Carolinas website has a dedicated directory with all of the food banks that serve both North Carolina and South Carolina. These food banks are:

Debt collection laws in North Carolina

North Carolina residents are protected by the Fair Debt Collection Practices Act (FDCPA). The FDCPA is a federal law that prohibits debt collectors from engaging in certain debt collection practices. For example, debt collectors cannot:

  • Use deceptive or unfair practices to collect money
  • Claim to be someone they’re not, such as a government official or legal representative
  • Harass the debtor (person who owes the money)
  • Contact the debtor outside of regular business hours unless given prior consent
  • Threaten jail time
  • Claim the debtor will have their wages garnished or that they will file a lawsuit (unless they intend to do so)
  • Try to collect extra fees or interest not outlined in the debt contract
  • Claim the debtor owes a debt they don’t or for a different amount

North Carolina also has a North Carolina Attorney General Resource dedicated to debt collection in the state. This resource goes into detail about several things, including:

  • The different types of debt collectors, such as those working with the IRS
  • The rules debt collectors must follow when collecting a debt
  • Ways in which you can prevent a debt collector from contacting you

The NC Attorney General Resource has a toll-free phone number residents can use if they’d like to register a complaint about a debt collector: 1-877-566-7226

North Carolina also expands on the FDCPA with several state-specific restrictions on debt collection. The state has a section in their general statues called Article 2: Prohibited Acts by Debt Collectors. This section provides further details about how debt collection works in the state. Among other things, debt collectors cannot:

  • Use or threaten violence
  • Make false accusations to or about another person
  • Constantly contact an individual over a potential debt
  • Use unfair means or coercion to collect money

The Prohibited Acts by Debt Collectors also says that any debt collector that doesn’t comply with these rules will be charged a sum equal to the damages caused. This can be anywhere from $500 to $4,000.

The Tar Heel State also has the North Carolina Collection Agency Act. This section describes the licensing details and operating procedures debt collection agencies must follow.

Income and employment in North Carolina

In the country, North Carolina ranks 5th in job growth with 197,700 new jobs. The state’s current unemployment rate is 3.9%, down from 14.2% during the height of the COVID-19 pandemic. For context, the average unemployment rate in the U.S. is currently about 3.7%.

North Carolina is an employment-at-will state, which means that an employer may terminate an employee with or without cause (apart from discrimination or other illegal reasons). It’s also a right-to-work state, meaning employees do not have to join a labor union to work.

The main downside to employment-at-will and right-to-work states is that people often face reduced job security and, in some cases, lower wages.

How to apply for unemployment benefits in North Carolina

If you’re unemployed or facing reduced hours at work, it may be a good idea to consider applying for unemployment benefits.

Start by heading to the North Carolina Department of Commerce. From there, create an account so you can start an online application. This website has a complete guide on how to apply for benefits. It also lets you create an account that you can use to file future claims and monitor your current benefits.

To apply, you’ll need some information, such as:

  • Past two years’ employment details (ex. your previous employer and their contact information, your last payment amount, and why you left)
  • Personal information (ex. SSN, full name)
  • Banking information

After creating an account, you can submit your first claim. Eligible North Carolinians can receive up to $350 a week for a maximum of 12 weeks. While receiving benefits, you’ll need to continue applying for work and filling out weekly certifications.

Banking and taxes in North Carolina

For the 2022 tax year, North Carolina’s individual income tax rate is 4.99%. It was 5.25% in 2019, 2020, and 2021. It’s also projected to decrease to 4.75% in 2023.

In 2021, 3.3% of North Carolina residents were unbanked, meaning they don’t have a checking or savings account. People who are unbanked often end up turning to alternative forms of financing, such as payday or title loans, which are expensive and can lead to more debt.

North Carolina housing market

About 66.3% of North Carolinians are homeowners. The current median monthly home payment is $1,290 in North Carolina.

Meanwhile, the average home value is $329,551, a 17.8% increase over the past year. This is slightly lower than the national average, which is $357,589.

In response to COVID-19, the state created the North Carolina Homeowners Assistance Fund. This fund is meant for homeowners who need help in the face of mortgage delinquencies, foreclosures, defaults, and displacements.

As for renters, the average rent payment in Raleigh, North Carolina is $1,631, according to RentCafe. Rent prices may be lower in smaller cities.

Retirement in North Carolina

On average, North Carolina residents have about $464,104 set aside for retirement. The average North Carolinian needs around $652,841 to retire comfortably.

Average North Carolina insurance premiums

Homeowners insurance in North Carolina averages at about $1,317 per year for a home valued at $250,000. This is slightly lower than the national average, which is $1,516 annually.

Full coverage car insurance is $1,392 annually, on average. This is about even with the U.S. average of $1,442.

Payday lending status in North Carolina: Prohibited

Payday loans are prohibited in North Carolina:

  • Maximum loan amount: N/A
  • Maximum Interest Rate (APR): N/A
  • Minimum loan term: N/A
  • Maximum loan term: N/A

Statute of limitations on debt in North Carolina

The statute of limitations on debt in North Carolina ranges from three to 10 years, depending on the debt type:

  • Medical debt: 3 years
  • Credit card: 3 years
  • Auto loan debt: 4 years
  • State tax debt: 10 years

Help for Veterans

As of 2020, North Carolina was home to 703,142 Veterans. The North Carolina Department of Veteran Affairs offers many resources to help Veterans and their families who are facing unemployment, homelessness, or other financial difficulties.

Facilities in North Carolina 

If you’re looking for a local VA, you’re in luck. Here are the main VAs, as well as a complete directory for the state.

Employment resources for Veterans

If you’re a Veteran or surviving spouse, here are some of North Carolina’s top employment resources:

  • The North Carolina Office of State Human Resources offers access to job fairs, employment services, training and education options, and more for Veterans.
  • CareerOneStop is a one-stop shop for Veterans who need job-related assistance or help to find civilian jobs
  • MilitaryHire.com is an online platform where Veterans can post their resumes and apply for jobs
  • VeteranRecruiting.com helps Veterans and their spouses through online career fairs, a virtual recruitment center, and other employment opportunities
  • Helmets to Hardhats is a national program that works with Veterans and active duty personnel who are looking to transition into a civilian career in construction
  • Hiring Our Heroes is also a nationwide program that helps Veterans via job training and networking
  • My Next Move assists Veterans in finding a civilian job
  • Warriors to Work helps Veterans through a variety of career-related resources, including job counseling and resume help.

The bottom line

Whether you’re looking for debt relief programs like debt settlement or credit counseling, or you need access to financial assistance resources, North Carolina has something for everyone. If you’re dealing with extreme financial hardship, consider contacting an agency for help.

FAQs

How long can a debt be collected in North Carolina?

Most consumer debts, including medical and credit card debt, can be collected for three years. Auto loan debts can be collected for up to four years. State tax debt has a longer collection time of 10 years.

When does the statute of limitations begin in North Carolina?

The statute of limitations on debt in North Carolina begins on the date of the latest activity on the account. In many cases, this could be on the date you last made a payment.

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

Debts are usually split fairly between both spouses upon divorce, as determined by the court. This does not necessarily mean they’re split 50/50, however. If, for example, your spouse accrued most of the household debts, they may be responsible for repaying them.

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