Top 10 States Where Personal Loans Are Most Popular: A 2025–2026 Data Snapshot
In Mississippi, more than half of consumers hold a personal loan. In Massachusetts, barely a quarter do. We ranked all 50 states — and found borrowing tracks income more tightly than geography.
Personal loans have become one of the fastest-growing consumer credit products in the United States. Roughly 38% of U.S. consumers now hold one — nearly as many as have a mortgage — and total balances reached a record $597.6 billion in 2025 (Experian).
But "most popular" is a slippery phrase, and most rankings never define it. So we start by saying exactly what we mean.
How we define "popular." Our primary measure is the borrowing rate — the share of consumers in a state who have at least one personal loan on their credit report. (Analysts sometimes call this "penetration"; throughout this article we simply say borrowing rate.) It counts people, not dollars, so a state isn't ranked highly just because a few residents carry large loans. We then layer in two secondary lenses — how large the average balance is, and how fast balances are growing. All borrowing figures are for September 2025 unless labeled as a 2026 outlook.
Our Methodology — And Why It Differs From Most Coverage
Most personal loan "rankings" pick a single number — almost always average balance in dollars — and present it as the definitive answer. That's misleading, because a high average balance can reflect a few borrowers holding large loans rather than widespread borrowing. As you'll see below, the states with the biggest balances are not the states where the most people borrow.
Income quartiles used in this article
Throughout the appendix we group states into four income bands. To avoid confusion, here are the exact dollar cutoffs, based on 2024 ACS median household income across the 50 states:
- Q1 — Low income: up to $76,750
- Q2 — Lower-middle income: $76,751 – $83,400
- Q3 — Upper-middle income: $83,401 – $92,300
- Q4 — High income: $92,301 and above
Each band holds roughly a quarter of the 50 states. This is why two states with similar incomes (for example, Florida at $75,630 and Missouri at $78,390) can fall into different bands — they sit on opposite sides of the $76,750 cutoff.
Our approach is different in three deliberate ways:
Our headline ranking is the share of consumers who actually hold a personal loan (Experian, all-lender credit-file data) — the truest reading of "popular." Balance and growth are reported separately, never blended into one score.
We paired Experian's state penetration data with U.S. Census median household income and computed the relationship ourselves. That result is original to this article, not lifted from another study.
Older articles claim the Northeast leads. That's true for one metric (new-loan size) and false for another (penetration). We show both and explain why they diverge.
Everything marked 2025 is actual reported data. Anything about 2026 is explicitly an outlook.
We did not run a proprietary consumer survey or model future balances. Source data comes from Experian and the U.S. Census Bureau, both linked below. Our original contribution is the analysis — the penetration-first framing and the income correlation we computed — not the raw collection.
How We Measure "Popularity"
There is no single official ranking of personal loan popularity, so we use three complementary lenses:
- Borrowing rate (primary) — the share of consumers in a state holding at least one personal loan on their credit report. This counts people, not dollars, and is our headline ranking. (Experian, Sept 2025)
- Highest average balances — where residents carry the most personal loan debt per borrower (Experian).
- Fastest-growing balances — where demand is accelerating most sharply year-over-year (Experian).
- Everyday reliance — where residents most often request a personal loan just to cover routine bills (LendingTree).
A state can rank high on one measure and low on another, and that contrast is often the most interesting local story.
Where the Most People Actually Borrow
By the share of consumers holding a personal loan, the leaders are unmistakably in the South. Experian's own analysis notes Southern states show the highest uptake, while New England shows the lowest. In Mississippi, a majority of consumers carry a personal loan.
States with the highest share of consumers holding a personal loan:
| # | State | Share with a loan | Median income |
|---|---|---|---|
| 1 | Mississippi | 53.5% | $55,980 |
| 2 | Alabama | 50.1% | $65,560 |
| 3 | Louisiana | 48.4% | $60,740 |
| 4 | New Mexico | 48.2% | $64,140 |
| 5 | Wyoming | 47.7% | $78,680 |
| 6 | Oklahoma | 47.4% | $65,310 |
| 7 | South Carolina | 46.8% | $76,780 |
| 8 | Texas | 46.2% | $81,490 |
| 9 | Arkansas | 45.9% | $64,840 |
| 10 | Tennessee | 45.6% | $75,860 |
Source: Experian, Sept 2025 (penetration); U.S. Census Bureau, 2023 ACS (income).
Lowest borrowing rate — concentrated in the wealthy Northeast: Massachusetts (27.1%), New Jersey (27.4%), Connecticut (28.3%), New York (28.3%), Rhode Island (29.9%).
The spread between the highest and lowest states is 26.4 percentage points — Mississippi at 53.5% against Massachusetts at 27.1%. Personal-loan borrowing is close to twice as common in the Deep South as in New England.
Our Analysis: Personal Loans Track Income — Inversely
The states with high borrowing rates tend to be lower-income; the states with low borrowing rates are wealthier. But there are clear exceptions. Most states where a lot of people take out loans have lower average incomes — but places like Wyoming (#5, $78,680) and Texas (#8, $81,490) are different: people there earn middle-to-high incomes and still borrow heavily. To test whether the pattern holds across the whole country rather than just at the extremes, we paired all 50 states' borrowing rates with Census median household income and computed the relationship ourselves.
In simple terms: Income and loan usage move in opposite directions. Generally, states with lower average incomes have more people taking out personal loans. In fact, income levels alone explain about 58% of the difference in loan usage from state to state.
For readers who want the exact statistics behind that summary:
Result (n = 50 states):
Statistic Value Pearson r = −0.76 (95% CI −0.86, −0.61)
R² = 0.58
Spearman ρ = −0.75
p-value < 0.001
Median household income alone explains roughly 58% of the state-to-state variation in personal loan penetration.
Average penetration by income quartile:
| Income quartile | Avg. penetration |
|---|---|
| Q1 — Low income (up to $76,750) | 45.5% |
| Q2 — Lower-middle ($76,751–$83,400) | 40.9% |
| Q3 — Upper-middle ($83,401–$92,300) | 37.8% |
| Q4 — High income ($92,301+) | 34.5% |
The full 50-state dataset behind these figures is published in the appendix at the end of this article.
Limitations
Correlation does not establish causation, and income is not the only
variable moving these numbers. Three confounders we did not control for:
- State regulation.
Rate caps and consumer-finance statutes in states such as New York and Illinois suppress high-cost lending directly. Those states are also high-income, so regulation and income are entangled in our data. - Cost of living.
Median income is not adjusted for purchasing power. A $75,000 household income means something different in Mississippi than in Massachusetts. - Lender density and product mix.
Access to storefront and subprime lenders varies sharply by state and correlates with both income and rurality.
A model that separates these factors from one another (technically, a multi-variable regression) is beyond the scope of this analysis. We report the simple two-way relationship as an observed pattern, not a causal claim.
Who's Borrowing, and Why
- The reason: Debt consolidation is the top driver — about 31% of loan requests — as borrowers refinance credit-card balances (averaging over 22% APR) into fixed-rate personal loans (Experian).
- Who: Usage peaks in middle age — 46.5% of Gen X and 45.4% of millennials, versus 38% of all consumers.
- Credit mix: Subprime and near-prime borrowers together account for roughly half of outstanding balances, and online lenders (FinTechs) now make a large and growing share of new loans (TransUnion).
Why the Numbers Vary: State Regulation Matters
Personal lending is regulated at the state level. States such as Illinois and New York enforce stricter consumer-finance laws and rate caps, which shield residents from the riskiest loans and suppress high-balance subprime borrowing. So a state can look "less popular" partly because its legal environment channels demand elsewhere — these maps reflect policy as much as need.
2026 Outlook (Projection, Not Reported Data)
Forward-looking; read as outlook, not fact. Experian expects demand to keep climbing in 2026, driven by Federal Reserve rate cuts that make refinancing more attractive and insurance-premium shocks pushing households toward emergency borrowing. In a January 2026 Experian survey, 42% of consumers said recent economic conditions made them more likely to take out a personal loan this year.
Quick Reference
| Measure | Leading states | National figure |
|---|---|---|
| Highest penetration | MS 53.5%, AL 50.1%, LA 48.4%, NM 48.2%, WY 47.7% | 38.0% |
| Lowest penetration | MA 27.1%, NJ 27.4%, CT 28.3%, NY 28.3%, RI 29.9% | 38.0% |
| Largest average balance | WA $28,715, MT $28,132, OR $26,884 | $19,333 |
| Fastest balance growth | CT +8.5%, VA +6.8%, MD +6.6% | +1.7% |
The "National average" column is a single U.S.-wide baseline for comparison — the same 38.0% applies to both the highest- and lowest-borrowing states, which is why leaders at 47–53% and trailers at 27–29% both sit against it.
Borrowing rate and balance rank states almost independently: Washington has the largest average balance in the country but a below-average borrowing rate (34.0%), while Mississippi leads on borrowing rate with a balance near the national median. Any ranking that reports only one of these metrics will mislead.
Appendix: Full 50-State Dataset
Every figure used in the correlation above, sorted by borrowing rate. Borrowing rate and average balance: Experian, September 2025. Median household income: U.S. Census Bureau, 2024 ACS (Table B19013).
How to read the last two columns: A state's balance rank is its position (1 = highest) among the 15 states for which Experian publishes an average balance. The rank gap shows the difference between how many people take out loans versus how much money they borrow. A positive number (like +13 for Alabama) means the state has a high borrowing rate but a relatively small average loan; a large negative number (like −41 for Washington) means the opposite — few borrowers, but big loans.
| # | State | Share with a loan (2025) | 2024 | YoY change | Median household income | Income quartile | Avg. balance | Balance rank | Rank gap |
|---|---|---|---|---|---|---|---|---|---|
| 1 | Mississippi | 53.5% | 52.2% | +1.3 pp | $55,980 | Q1 lowest | — | — | — |
| 2 | Alabama | 50.1% | 49.1% | +1.0 pp | $65,560 | Q1 lowest | $17,793 | 15 | +13 |
| 3 | Louisiana | 48.4% | 47.8% | +0.6 pp | $60,740 | Q1 lowest | — | — | — |
| 4 | New Mexico | 48.2% | 47.7% | +0.5 pp | $64,140 | Q1 lowest | — | — | — |
| 5 | Wyoming | 47.7% | 47.5% | +0.2 pp | $78,680 | Q2 | — | — | — |
| 6 | Oklahoma | 47.4% | 46.8% | +0.6 pp | $65,310 | Q1 lowest | — | — | — |
| 7 | South Carolina | 46.8% | 46.1% | +0.7 pp | $76,780 | Q1 lowest | — | — | — |
| 8 | Texas | 46.2% | 45.7% | +0.5 pp | $81,490 | Q2 | — | — | — |
| 9 | Arkansas | 45.9% | 44.4% | +1.5 pp | $64,840 | Q1 lowest | $21,874 | 5 | -4 |
| 10 | Tennessee | 45.6% | 44.8% | +0.8 pp | $75,860 | Q1 lowest | — | — | — |
| 11 | Kentucky | 45.3% | 44.4% | +0.9 pp | $64,790 | Q1 lowest | — | — | — |
| 12 | North Dakota | 45.1% | 45.7% | -0.6 pp | $88,080 | Q3 | — | — | — |
| 13 | West Virginia | 44.2% | 43.0% | +1.2 pp | $63,150 | Q1 lowest | — | — | — |
| 14 | Idaho | 43.9% | 42.8% | +1.1 pp | $81,650 | Q2 | — | — | — |
| 15 | South Dakota | 43.8% | 43.9% | -0.1 pp | $79,850 | Q2 | — | — | — |
| 16 | Montana | 43.8% | 43.1% | +0.7 pp | $81,920 | Q2 | $28,132 | 2 | -13 |
| 17 | Georgia | 43.5% | 42.3% | +1.2 pp | $81,210 | Q2 | — | — | — |
| 18 | North Carolina | 42.2% | 41.0% | +1.2 pp | $67,220 | Q1 lowest | — | — | — |
| 19 | Utah | 41.4% | 40.5% | +0.9 pp | $104,000 | Q4 highest | — | — | — |
| 20 | Indiana | 41.4% | 40.3% | +1.1 pp | $76,710 | Q1 lowest | — | — | — |
| 21 | Missouri | 41.1% | 40.1% | +1.0 pp | $78,390 | Q2 | — | — | — |
| 22 | Alaska | 40.6% | 39.9% | +0.7 pp | $91,260 | Q3 | $21,429 | 6 | -16 |
| 23 | Nevada | 40.2% | 38.7% | +1.5 pp | $80,590 | Q2 | $21,374 | 7 | -16 |
| 24 | Maine | 39.7% | 39.1% | +0.6 pp | $90,730 | Q3 | — | — | — |
| 25 | Arizona | 39.6% | 38.1% | +1.5 pp | $84,700 | Q3 | $22,316 | 4 | -21 |
| 26 | Nebraska | 39.4% | 38.7% | +0.7 pp | $86,140 | Q3 | — | — | — |
| 27 | Michigan | 39.1% | 38.1% | +1.0 pp | $79,460 | Q2 | — | — | — |
| 28 | Hawaii | 38.2% | 38.2% | +0.0 pp | $98,240 | Q4 highest | — | — | — |
| 29 | Iowa | 38.1% | 37.4% | +0.7 pp | $85,480 | Q3 | — | — | — |
| 30 | Delaware | 38.0% | 36.9% | +1.1 pp | $85,860 | Q3 | $19,632 | 11 | -19 |
| 31 | Vermont | 37.7% | 37.0% | +0.7 pp | $85,260 | Q3 | — | — | — |
| 32 | Kansas | 37.6% | 36.5% | +1.1 pp | $87,690 | Q3 | $20,012 | 10 | -22 |
| 33 | Wisconsin | 37.5% | 36.7% | +0.8 pp | $82,560 | Q2 | — | — | — |
| 34 | Virginia | 37.1% | 36.1% | +1.0 pp | $97,720 | Q4 highest | $18,353 | 13 | -21 |
| 35 | Florida | 36.6% | 34.6% | +2.0 pp | $75,630 | Q1 lowest | $20,407 | 9 | -26 |
| 36 | Minnesota | 36.3% | 35.7% | +0.6 pp | $92,350 | Q4 highest | — | — | — |
| 37 | Colorado | 36.1% | 35.4% | +0.7 pp | $106,500 | Q4 highest | — | — | — |
| 38 | Ohio | 35.8% | 34.6% | +1.2 pp | $80,520 | Q2 | — | — | — |
| 39 | Pennsylvania | 35.5% | 34.6% | +0.9 pp | $80,060 | Q2 | — | — | — |
| 40 | Oregon | 35.3% | 34.1% | +1.2 pp | $89,700 | Q3 | $26,884 | 3 | -37 |
| 41 | New Hampshire | 35.1% | 34.2% | +0.9 pp | $111,800 | Q4 highest | $21,058 | 8 | -33 |
| 42 | Washington | 34.0% | 33.1% | +0.9 pp | $97,500 | Q4 highest | $28,715 | 1 | -41 |
| 43 | Maryland | 34.0% | 33.0% | +1.0 pp | $109,700 | Q4 highest | $18,849 | 12 | -30 |
| 44 | Illinois | 33.7% | 32.9% | +0.8 pp | $84,210 | Q3 | — | — | — |
| 45 | California | 33.4% | 32.3% | +1.1 pp | $100,600 | Q4 highest | — | — | — |
| 46 | Rhode Island | 29.9% | 28.4% | +1.5 pp | $92,290 | Q4 highest | — | — | — |
| 47 | Connecticut | 28.3% | 27.1% | +1.2 pp | $99,240 | Q4 highest | $18,128 | 14 | -33 |
| 48 | New York | 28.3% | 27.4% | +0.9 pp | $86,830 | Q3 | — | — | — |
| 49 | New Jersey | 27.4% | 26.2% | +1.2 pp | $103,500 | Q4 highest | — | — | — |
| 50 | Massachusetts | 27.1% | 26.2% | +0.9 pp | $113,900 | Q4 highest | — | — | — |
Borrowing rate: Experian, September 2024 and September 2025. Median household income: U.S. Census Bureau / ACS 2024 (Table B19013, 2024 dollars). Average balance published by Experian for 15 states only; "—" indicates no published figure. Rank gap = balance rank minus borrowing-rate rank; a positive number means the state ranks higher on borrowing rate than on balance. District of Columbia excluded (not a state).
Loan metrics reflect September 2025; income data reflect the 2024 American Community Survey. The 2026 section is a labeled projection, not reported data. Correlation does not establish causation. This article is informational and does not constitute financial advice.
Sources
- Experian — "Personal Loan Use Reaches New High" (Feb 2026), state penetration table: https://www.experian.com/blogs/ask-experian/personal-loan-usage-statistics/
- Experian — "Average Personal Loan Balance Grows 1.7% in 2025" (Mar 2026): https://www.experian.com/blogs/ask-experian/research/personal-loan-study/
- U.S. Census Bureau — Median household income by state, 2023 ACS (Table B19013): https://data.census.gov/
- TransUnion — Q2 2025 Credit Industry Insights Report: https://newsroom.transunion.com/q2-2025-ciir/
- Bankguider analysis — Income-vs-penetration correlation across all 50 states (Pearson r = −0.76, R² = 0.58).
Last updated: July 23, 2026
Next scheduled update: upon Experian's next state-level release.
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