FICO: Average credit score reaches all-time high of 706

[left-of-center2012]

The average FICO score for U.S. consumers is now 706 (in a range of 300 to 850), according to new data from the credit scoring firm. It’s a significant jump from the average of 686 in October 2009. But consumers scores have been increasing since 2009, thanks in part to a healthy economy that has featured steady growth since the Great Recession (which began in December 2007).

In a Sept. 10 blog post, FICO vice president of scores Ethan Dornhelm said key drivers of the trend include greater consumer awareness regarding FICO scores and negative credit data being removed from consumers’ files. Credit missteps such as missed payments that occurred during the Great Recession have largely fallen off consumers’ credit reports, he noted.

Meanwhile, the three major credit bureaus – Equifax, Experian and TransUnion – have in recent years removed negative items such as civil judgments and tax liens from consumers’ credit reports under new reporting standards.

The percentage of U.S. consumers with the lowest score range (below 550) has dropped from 16 percent in April 2009 to 11.1 percent in April 2019 — almost a third. And the percentage of super-prime range consumers (800-plus) has increased from 18.2 percent to 22.3 percent during the same period. Additionally, FICO data show credit card account delinquencies of 90 days or more have fallen by 62 percent, credit card utilization is down by 28 percent, credit histories are 9 percent longer and credit-seeking activity has decreased by 14 percent.

https://www.creditcards.com/credit-card-news/average-fico-score-reaches-all-time-high.php

[SWBTATTReg]

1. Thanks for posting! Wonder if this is a sign of ...

.after the last recession, people slammed on the brakes in using credit;
.credit companies slammed on the brakes in issuing credit;

[Freddie]

2. Paying bills online

Really helps. In the past you’d mail a check and were at the mercy of snail mail, plus once the company got your check they could post it at their leisure and call it “late” (with a late fee of course) and there wasn’t much you could do about it.

[OilemFirchen]

3. Some of this is attributable to automated payments.

Some, as the article suggests, is because of changes in credit reporting.

Still good news, in any event.

[redstatebluegirl]

4. We began seriously paying anything we owed after Trump was elected.

We felt in our hearts the bottom would fall out and interest rates would rise. We paid off a ton of credit cards, our cars and made a dent in our mortgage. We used every single dime we had extra to do this, no eating out, nothing extra. We are blessed to both be working so we can do this. I know a lot of people can't do it.

We have talked to friends and almost all of them have been doing the same thing since 2016. We are also getting closer to retirement so we don't want any debt if we can help it.

We got a little money from my mother in law when she passed and we used all of that towards the debt. Fear makes you have a coming to Jesus moment about your spending for sure.

We are blessed to be able to do this, I feel for those who are not able to.

[Wellstone ruled]

5. Paragraph four is the real reason

for these numbers improvements. As a part time loan officer in the 2005-2009 time frame,this was one of the big ugly's that would blow up many a home loan.

But,one could find some Idiot Lender who would bite on any No-Doc garbage loan as long as you packed a heavy Mortgage Insurance Rider on it.