5 States With Best and Worst Credit Scores

You might be wondering what your credit score has to do with the state you live in. After all, it’s something individuals are responsible for, and depends on paying all your dues on time.

While you are the only one whose actions directly affect your credit score, there are undeniable discrepancies between states regarding credit score height. This is therefore indicative of other economic conditions that can change if you move between states. For example, higher credit scores are typically associated with a higher level of income. After all, with more money in their pocket, people can make their payments than those living paycheck to paycheck.

Before we start ranking the states, let’s give you the touchpoints first. The current national median average income is $61,937, according to Census data. National Mortgage Database data states that the national default rate is 0.80%.

Now, let’s see the actual rankings of the best and worst five states.

The Five States With the Best Credit Scores

1. Minnesota

Credit Score: 724

Minnesota has the highest average credit score. This tracks, as Census data shows that Minnesota’s median income is $70,315. Therefore, its average delinquency rate is 0.50%. Together, they make for high credit scores.

2. Vermont

Credit Score: 719

Vermont and New Hampshire, the next ones on our list, have the same median credit score of 719. Oddly enough, Vermont had an average income lower than the national median, at $60,782. However, Vermont had one of the highest average credit scores.

3. New Hampshire

Credit Score: 719

With the same credit score as Vermont, New Hampshire takes third place. It has the same mortgage delinquency as the national average. Still, its auto loan delinquency rate was lower than the national average.

4. Massachusetts

Credit Score: 718

Massachusetts had almost all significant delinquency rates lower than the national average, including student, auto loan, and credit card debt. What’s more, the median household income for 2018 in this state was around $20,000 higher than the national median.

5. Washington

Credit score: 716

Washington is another state that has a high median income - $74,073. It also has a low delinquency rate, at 0.40%. Unfortunately, Urban Institute Credit data uncovers that residents have also piled up some medical debt in Washington, with an average of $1,846, which might affect their credit scores significantly.

5 States with The Worst Credit Scores

The following five states scored poorly compared to the national average. These five states had a median income of $50,850 and average mortgage delinquency rates of 1.09% - 0.29% higher than the national average.

1. Mississippi

Credit score: 662

As of July 2020, Mississippi has the lowest credit score in America. It has the second-lowest median income, at $44,717. Unfortunately, it also has the highest mortgage delinquency rate - 1.50%.

2. Louisiana

Credit score: 667

Louisiana is, unfortunately, the second-worst. It has the fourth-lowest median income out of the ten states with the lowest scores. It also had a mortgage delinquency rate of 1.3%, which is considerably higher than the national average.

3. Alabama

Credit score: 670

Alabama’s median income is well below the average - $49,861. According to National Mortgage Database data, its mortgage delinquency rate is 0.50% higher than the national average, too.

4. Arkansas

Credit score: 671

Arkansas is also a state with an underwhelmingly low median income - just $47,062. It also has high delinquency rates for loans, including mortgages, auto loans, and credit cards debt, landing it in the position of the fourth-worst state.

5. Oklahoma

Credit score: 671

Oklahoma shares the same credit score as Arkansas. It also has debt collections significantly higher (37%) than the national average (29%).

Improving Your Credit Score

As we mentioned before, your credit score depends entirely on you. If you are looking to improve it, you don’t have to move to another state. Here are some practices you could implement instead:

Make Timely Payments

Since your payment history accounts for 35% of your FICO score, you should try to adopt the habit of paying all of your bills on time. If you are 30 days past due, the provider will likely report it to a credit bureau, which will, in return, hurt your credit score.

Review Your Credit Reports

You can find at least one error in 34% of credit reports. Therefore, check your credit reports as often as possible and dispute any irregularities, especially those that can impact your credit score. You can request a free once-a-year credit report from all three credit bureaus to keep track of things.

Hire An Expert

If you can’t seem to improve your credit score by yourself (or don’t have the time), you can always hire one of the credit repair companies to do it for you. These companies can handle credit disputes, challenge your late payments, and overall, help you repair your credit score.