2. Consumer Finance Profiles
This section compares credit and debt portfolios of rural southerners with 1) the national
average and 2) other rural consumers in other parts of the U.S. For example, we contrast the
prevalence of and typical balances on credit cards, auto loans, mortgages, and student loans
across groups of consumers to illuminate how the financial situations of rural southerners
compare to and differ from those for consumers elsewhere. Moreover, we show these measures
for Persistent Poverty Counties (PPCs) within the rural southern region to highlight consumer
finance profiles of individuals in counties with persistently lower incomes.
10
We draw on the
CFPB’s Consumer Credit Panel (CCP), a comprehensive, national, 1-in-48 sample of de-
identified credit records maintained by one of the three nationwide consumer reporting agencies
(NCRAs). In doing so, we consider all open credit tradelines of consumers who appear in the
CCP sample at least once between the first quarter of 2020 and the first quarter of 2022.
11
For
Table 2 and subsequent tables, the sample size of unique consumer-level observations is as
follows: 64,776 in rural Persistent Poverty Counties in the southern region, 181,899 in the rural
southern region, 584,789 in non-southern region rural areas, and 5,734,997 for the national
average.
Table 2 shows the share of consumers in each region with an average credit score (over the
2020–2022 period) in each credit score category.
12
Compared with all consumers nationally, a
larger share of rural southerners have a deep subprime or subprime credit score (37 percent
compared to 26 percent), and a smaller share has a prime or super-prime score (49 percent
compared to 63 percent). These differences are more pronounced in rural Persistent Poverty
Counties in the southern region, where 42 percent of consumers have a deep subprime or
subprime credit score and only 43 percent have prime or super-prime credit scores. Likewise, as
shown in Table 3, among majority-minority census tracts in the region, there are differences
10
A Persistent Poverty County (PPC) is defined as any county or county equivalent that has had 20 percent or more of
its population living in poverty over the last 30 years, as measured by the decennial census.
11
For the purposes of this analysis, consumers in the panel without a census tract and consumers who reside in U.S.
territories (American Samoa, Puerto Rico, U.S. Virgin Islands, and Guam) were excluded from the sample. The time
period is chosen for comparability with the previous report on Consumer Finances in Rural Appalachia and includes
the effects of the COVID-19 pandemic and related emergency financial support efforts.
12
Credit scores are designed to help lenders assess potential borrowers’ credit risk. However, they may not always
accurately reflect an individual consumer’s likelihood to repay. For example, studies have found that a substantial
minority of consumers have errors on their credit reports with the three nationwide consumer reporting agencies
(CRAs), including errors substantial enough to meaningfully affect consumers’ credit scores. From October 2021 to
September 2022, the CFPB received nearly one million credit or consumer reporting complaints. The CFPB sent more
than 565,000 credit or consumer reporting complaints to companies for response. See CFPB, “Annual Report of
Credit and Consumer Reporting Complaints” (January 2023) available at https://www.consumerfinance.gov/data-
research/research-reports/annual-report-consumer-credit-reporting-complaints-analysis-of-complaint-responses-
equifax-experian-transunion-2022/
DATA POINT: CONSUMER FINANCES IN THE RURAL SOUTHERN REGION 10