Consumers’ Credit Scores are Improving, Despite Taking on More Debt

No matter what credit scoring model is used, it’s very clear that the average consumer’s creditworthiness has been improving for years, after bottoming out during the financial crisis.

Experian reported this month that the average VantageScore hit an eight- year high at 682.



Improving credit scores come in the wake of higher consumer debt. The Federal Reserve Bank of New York reported last month that the total household debt increased by $92 billion (0.7 percent) to $13.95 trillion in the third quarter of 2019. This marks the 21st consecutive quarter with an increase.

“We’re seeing a promising trend in terms of how Americans are managing their credit as we head into a new decade with average credit scores increasing two points since 2018 to 682 – the highest we’ve seen since 2011,” said Shannon Lois, Experian’s head of analytics, consulting and operations. “Average credit card balances and debt are up year over year, yet utilization rates remain consistent at 30 percent, indicating consumers are using credit as a financial tool and managing their debts responsibly.”

Meanwhile, the average U.S. FICO Score now is at 706, reported in September. The average FICO bottomed out at 686 in October of 2009. That mans there has been nine consecutive years of increases in the national average FICO Score.

In a blog post, Tom Quinn, Vice President of Business Development for myFICO, states: “Account-level delinquencies are down by double-digit percentages. We also see substantially lower credit card utilization, lengthier credit histories, and less credit seeking activity. It is no surprise that we’ve seen such a major improvement in the national average FICO Score over the past decade.”