- A payday loan is a high-interest loan taken out between paychecks. The high interest rate and short term of the loan works on the assumption that the debtor will pay back the loan once they reach payday. CNBC reports this area of consumer debt hit $40 billion nationwide, according to the Community Financial Services Association of America
- Credit cards are commonly used to purchase many different types of goods, with incentives offered such as low interest rates, points or cash back with each purchase. This type of consumer debt is considered to be revolving. A revolving debt opens the credit line back up as you pay down the balance. Credit card debt is reported to be $953.1 billion, according to CNBC.
- The cost of colleges and universities continues to rise, and the overall debt for federal student loans is $556 billion. That does not include private student loans, which many students rely on to pay their full tuition and living expenses while going to school.
- Car loans are another area of consumer debt that is on the rise. This type of debt covers installation loans secured by an automobile, and they are offered through banks, credit unions, and directly through car manufacturers and dealerships. The Federal Reserve reports that $313.8 billion of these loans are still withstanding as of February 2010.
- Revolving home equity loans, or HELOC, is a revolving line of credit that uses home equity to determine the credit limit. Like a credit card, HELOC credit lines can be used multiple times as you pay down the balance. The amount of consumer debt reported for this type is $577.8 billion.
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