Personal Finance News
Average FICO Credit Score Falls Slightly Year-Over-Year
A new report from FICO shows that the average credit score for American consumers recently dipped.
About the Latest Average Credit Score Data:
According to the latest data from FICO, the average credit score in the United States has fallen. Now, the average stands at 715. That’s down two points from last April and down one point since January of this year. It also marks the lowest average recorded since 2020.
Despite this dip, the average score has increased significantly in recent years. For context, the average score in April 2014 (10 years ago) was 692. Additionally, the 715 average is in the range of “good credit.”
Partially contributing to this decrease is a change in what’s included on credit reports. For the first time since March of 2020, federal student loan delinquencies are once again being reflected on U.S. consumers’ credit reports. This resumption began in February of this year.
FICO credit scores range from 300 to 850 and are meant to give creditors insight into an applicant’s creditworthiness. As part of this, FICO considers five main factors of varying weight:
- Payment History (35%)
- Amounts Owed (30%)
- Length of Credit History (15%)
- Credit Mix (10%)
- New Credit Inquiries (10%)
Notably, FICO offers multiple models for creditors, so a customer’s score can vary from lender to lender. Additionally, while FICO is the most common credit score provider, consumers can often access their credit information as reflected via VantageScore by using a free platform such as Credit Karma.
What They’re Saying:
Discussing this report, FICO’s senior director of Scores and Predictive Analytics Tommy Lee noted, “FICO remains committed to providing the industry with reliable, independent insights that help lenders make informed decisions and empower consumers to understand and manage their credit. The modest decline in the national average FICO Score is consistent with the anticipated effects of resuming student loan delinquency reporting.”
Lee added, “As we move through 2025, we’ll continue to monitor how consumers navigate the post-forbearance credit environment as well as the ongoing economic uncertainty.”
My Thoughts:
It should be stated once again that the average credit score of 715 is still solidly in the “good” credit category. Therefore, the two-point decrease is far from any sort of catastrophe. Still, as FICO notes, it does reflect the continuing student debt issues that have plagued our nation for years (as the decision to pause these delinquency reporting during the pandemic highlights).
P.S. To learn more about how credit scores work and how you can improve yours, check out our guide.
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