If you want to know how Americans are doing financially, take a look at their credit scores. Many are doing great. Many others have a rocky relationship with credit cards. To tell who’s who, just take a look at credit score statistics.
Your credit score plays an enormous role in your daily life. It can determine the interest rate you pay for credit cards, car loans, and mortgages. It can make the difference between moving your family into the house you love and having your mortgage application rejected.
Some potential employers even check applicants’ credit details to get a better picture of how responsible they are. Your credit score range can affect whether you’ll score your dream job or keep waiting tables.
With all this competition for credit, houses, and even jobs, it’s important to understand your own situation and how it compares to the average credit score.
Credit Score Stats – Editor’s Choice
- One in five Americans aged 20-29 don’t know their credit scores.
- More than 29.8% of Americans have a credit score of 680 or higher.
- 42.5% of America’s youth earning $49,999 or less per year have a credit score of 639 or lower, with only 24.6% reaching a score over 680.
- 51.2% of Americans renting property have no idea they can report rent and utility bill payments to improve their credit scores.
- Nearly one in two people don’t pay off their credit balances each month.
- Only 12% of the US population has a FICO score lower than 550.
- Americans owe more than $1.5 trillion in student debt.
Filling in the Credit Score Blanks
Like your Social Security number (SSN), your FICO score is one of those numbers you just need to know. Those three digits play a huge role in determining your eligibility for loans and the interest rates you pay.
The first thing you should know is that American credit score statistics are, more often than not, compiled by a company called FICO. FICO uses the information in your credit report to create a numerical representation of your creditworthiness.
There’s also VantageScore, a partnership of America’s three major credit bureaus: Equifax, Experian, and TransUnion. VantageScore is FICO’s main competitor. Both companies provide a credible credit score statistics report for every eligible individual.
Lenders and creditors use this information to determine whether your credit score rating means that you’re reliable enough to repay borrowed funds. They then decide whether or not they will approve your application and, if so, what interest rate they will charge. If you have a lower credit score, lenders consider you less likely to repay any loans you take out. You’ll pay a higher interest rate as extra insurance to the lender. However, there are lenders and lending platforms specialized for the individuals with low credit score.
What is considered a good credit score?
The FICO score chart ranges from 300 to 850, with 850 representing the highest score possible. We can sort these into five categories:
- Excellent: 750 and above
- Good: 700-749
- Fair: 650-699
- Poor: 600-649
- Bad: under 600
Ready for some fascinating, timely, super-important credit score statistics?
1. In April 2017, 20.7% of Americans had a FICO score of 800 or above.
This data represents a record-high percentage of people who rate over 800. Financial experts attribute this change in credit scores to a lower delinquency rate and the fact that fewer Americans are taking out loans they can’t afford. As a result, fewer people are falling behind on their payments and more are reaching the 800 credit score that was once out of nearly everyone’s reach.
This is a positive change after a decade or so of turbulent times. It’s clear that credit scores are generally rising. Let’s dig a little deeper by examining the credit score statistics distribution in recent years: