Smart Borrower Blog

Average Credit Scores Hit Record High

Oct 17th, 2018 @ 9:24 PM by Amber Nelson

Americans are figuring out how to manage their credit, it would seem. New data from Fair Isaac & Co. (FICO) shows that the average FICO score rose this year to an all-time of 704, up 4 points from 2018. The average score has risen for the past 8 straight years, climbing from a low of 686 during the Great Recession in 2009.

And consumers from every credit range are moving up. The Chicago Tribune reported that the number of Americans with scores between 300 and 499 has fallen 3% over the past 9 years and the number of consumers with scores from 500 to 549 dropped 2%. Today 42% of Americans have credit scores between 750 and 800 and more than 20% are now “super prime” credit holders with score above 800.

The causes of these improvements in consumer credit could include many factors. First, information about how to raise one’s score is more readily available today than ever before. A quick internet search will turn up the basic formula for a credit score and which components are weighted most heavily. Consumers may be checking their credit more often and working to improve them.

Also, at the beginning of the year Equifax, Experian, and TransUnion decided to remove most civil judgments and about half of all tax liens from consumer credit reports after the Consumer Financial Protection Bureau recommended the changes. For those that previously had liens or judgments on their record, the new rules boosted their scores between 10 and 30 points almost instantly.

Delinquencies are also down which indicates greater financial responsibility among consumers. The average 30+day delinquency rate on installment loans fell to 1.73% of all loans while credit card delinquencies dropped to a rate of 3.06%, both well below their 15-year averages.

And lenders have been more risk adverse since the recession and more cautious in their lending practices, naturally weeding out borrowers less likely to make their loan payments on time.
Some combination of all these factors has helped average credit scores to rise, hopefully signifying a nation more responsible with its borrowing.

About Amber Nelson
Amber Nelson is a seasoned mortgage industry writer and a regular contributor to and

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