The states where student loan delinquency is increasing the most and the least

After five years of complicated and often contradictory policy, millions of borrowers are once again feeling the weight of their student debt. 

Federal student loan payments were first put on hold in early 2020 as part of the government’s pandemic response. That pause stretched for an unprecedented 43 months, giving borrowers a long break from monthly payments and interest accrual. As a result, the percentage of borrowers who were behind on their loans dropped to a historic low of below 1%. 

When payments resumed in October 2023, the Biden administration introduced a one-year “on-ramp” to help ease the transition. This allowed borrowers who missed payments to avoid the usual consequences, like having their delinquency reported to credit agencies. But that cushion expired in October 2024, and now, for the first time in years, missed payments are once again showing up on credit reports. 

By the first quarter of 2025, delinquencies began to rise sharply — in some states more than others. As the cost of living remains high and wages struggle to keep pace with inflation, many borrowers are finding it difficult to stay current.

WalletHub set out to find the states where delinquencies are increasing the most, looking at two essential factors in all 50 states: the share of delinquent student loans in the first quarter of 2025 and the change in the share of delinquent student loans between the first quarter of 2025 and the fourth quarter of 2024. 

John Kiernan, a WalletHub editor, has some advice for borrowers. “Being delinquent on student loans has the potential to ruin your finances and your credit score, but if you’ve only recently become delinquent you do have time to get back on track,” he explained. “Federal student loans don’t get reported to the credit bureaus as delinquent until you’re 90 days behind on payments, though private loans may report delinquency after as few as 30 days. 

He added: “If you’re having trouble paying, it’s important to contact your lender as soon as possible to try to work out a solution.”

Continue reading to see the five states where delinquency is increasing the most — and the five where it's decreasing the most.

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Arizona ranked fifth for the highest increase in student loan delinquencies, with a 45.45% rise between Q4 2024 and Q1 2025. The state’s total delinquency rate reached 0.80% in the first quarter of 2025.

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West Virginia ranked fourth for the largest rise in delinquency, with a 47.92% quarter-over-quarter increase. The state’s total share of delinquent student loans reached 0.78% in the first quarter of 2025.

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Vermont came in third with a 52.90% increase in student loan delinquencies. As of Q1 2025, 1.53% of student loans in the state were past due.

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Ranked second overall, Hawaii saw a 53.77% jump in student loan delinquency between Q4 2024 and Q1 2025. Although its delinquency rate remains relatively low at 0.27%, the sharp rise signals growing financial strain among borrowers.

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Missouri had the highest increase in student loan delinquency in the nation, taking the top spot overall. In the first quarter of 2025, 0.89% of student loans were delinquent — up 59.63% from the previous quarter.

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Nevada ranked 46th, with student loan delinquencies decreasing by 23.68% from Q4 2024 to Q1 2025. The state’s delinquency rate stood at 0.55% in the first quarter.

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Nebraska had the fourth-largest drop in delinquencies, coming in at 47th overall. Its student loan delinquency rate fell 24.07% to 0.47% in Q1 2025.

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Rhode Island placed 48th, with a 28.07% decline in student loan delinquencies. The state’s Q1 2025 delinquency rate was just 0.28%.

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Delaware saw a 35.21% decrease in delinquent student loans, which amounted to the second-largest drop in the country. Despite this decline, the state still had a relatively high overall delinquency rate of 0.86%.

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Alaska reported the sharpest decline in student loan delinquency, with a 61.16% drop — the largest of any state. By Q1 2025, only 0.32% of student loans were delinquent, placing it last in overall ranking for increase.