Credit Score Statistics in 2022

Credit Score Statistics

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Are you interested in learning more about credit scores and where you stand in comparison to other adults throughout the US? If so, let’s delve into some insightful consumer credit score statistics across 2020 and 2021. 

What Is the Average Credit Score in 2021?

According to data released by FICO (Fair Isaac Corporation) in 2021, the average FICO score is 716. It’s estimated that the average credit score rose a total of five points from the previous year.1 

The increase in scores may have been a result of changes in consumer behavior as well as payment accommodations offered by credit card companies and other lenders in the wake of the COVID-19 pandemic as they sought to decrease overall spending and credit utilization. 

How is a FICO score determined for American consumers? The credit scoring system calculates your credit score using the following breakdown.  

  • Payment history, or how frequently you’ve paid credit cards and loans on time: 35%
  • Amounts owed, or the total amount of credit you’re using in comparison to your total credit limit (credit utilization, for which spending on your credit cards and other lines of credit should always be less than 30 percent of your total limit): 30%
  • Length of credit history: 15%
  • New credit reported by credit reporting bureaus, or how often you’ve applied for and opened up new lines of credit like credit cards or student loans: 10%
  • Credit mix, the variety of credit types you have (credit cards, mortgages, auto loans, etc.): 10%

You can always check your score for free with tools from Credit Karma to monitor it and catch up with the average FICO score in the US! 

Also Read: Best Credit Building Apps

You can also learn more about tools, credit reporting companies, or legislation like the Fair Credit Reporting act with the Consumer Financial Protection Bureau. 

Percentage of the Population With No Credit Score

The Ascent, a publication by the Motley Fool, estimates that approximately 22 percent of Americans have no FICO score.2 There are several reasons why this may occur. These include: 

  1. The adults in question have not opened a credit account (credit card, loan, etc. from Federal Reserve banks or other financial institutions) within the past six months. 
  2. They have an inactive account that’s not reporting any activity to credit bureaus, such as a credit card that was never closed, resulting in no payment history or credit history from lenders on your credit report. 
  3. There’s an error in the credit report or a malicious third party that has reported the individual as deceased. Whether you believe someone has stolen your credit cards or your identity, always reach out to the proper authorities to deal with this immediately. 

Also Read: Can You Raise Your Credit Score 100 Points Overnight?

Percentage of Americans Who Have a Perfect FICO Score of 850

Having a perfect FICO score of 850 is a major achievement and one that only the most diligent consumers have achieved. According to a recent article on CNBC, only 1.6 percent of the US population has reached this top score.

What Percentage of the Population Has a Credit Score Over 700?

A credit score over 700 is considered to be good and will help you to secure lower interest rates on various loans and credit cards. If you fall into the score range of 701 to 850, you belong to the 59 percent of Americans who have a score of over 700 as well.4

Percentage of Americans Who Have a Credit Score Below 550

New data with a percentage breakdown is a bit harder to find. However, data reported by FICO toward the end of 2019 reveals that approximately 11.1 percent of the US population had a FICO score below 550.5

Such a low credit score can be reflective of high credit card debt and other financial issues. 

What Is Considered a Good Credit Score?

A FICO score of 670 or more is considered good.

To better understand where you fit in and whether or not you have a good credit score, you have to first understand the FICO credit score rating system. The FICO score ranges from exceptional credit to poor credit or bad credit. 

These ratings are determined by the following score ranges:

  • 800-850: Exceptional Credit
  • 740-799: Very Good Credit
  • 670-739: Good Credit
  • 580-669: Fair Credit
  • 300-579: Poor or Bad Credit

If your FICO score falls anywhere from 670 to 739, you’re considered to have a good credit score.  

Average Credit Score by Age

Age and generation play into these types of statistics, so we’re going to give you an age range for average credit score and provide you with the same information by generation afterward. 

According to Forbes6, the average credit score by age in 2020 is as follows:

  • Ages 18-23: 674
  • Ages 24-39: 680
  • Ages 40-55: 699
  • Ages 56-74: 736
  • Ages 75 and Up: 758

Average Credit Score by Generation

Translating the above data into generational categories, the data becomes:

  • Generation Z: 674
  • Millennials: 680
  • Generation X: 699
  • Baby Boomers: 736
  • Silent Generation: 758

Average Credit Score by Income

Looking for the average credit score by income leads us to a report from credit card provider American Express with data from 2018.7 

While income does not directly impact your credit score, factors like your available line of credit or the ability to maintain a solid payment history do. 

According to this report, the average credit score by income is broken down into:

  • $30,000 or Less: 590
  • $30,001 – $49,999: 643
  • $50,000 – $74,999: 737

Average Credit Score by Race

Credit score statistics on the breakdown of average credit scores by race are offered at Shift Payment Processing.8 According to their reports, the breakdown is as follows:

  • Black: 677
  • Hispanic: 701
  • Other: 732
  • White: 734
  • Asian: 745

As with the statistics above, this is a breakdown of the average FICO score. Alternative data sets from other sources utilized VantageScores instead. We’ll discuss the VantageScore statistics further in the sections below. 

Average Credit Score by Gender

Would you believe that, on average, men and women have the credit scores? While certain groups rarely share the same credit score, you may be surprised to learn that the average credit score by gender is actually a tie. 

An article published on CNBC using financial data published in early 2020 states that the credit score average for both men and women is now tied at 705.9

Average VantageScore in 2020

The statistics offered thus far have all centered around FICO scores. But what is VantageScore, and how does it differ? 

To better understand your credit score, it’s important to understand that FICO and VantageScore are both companies that have created different credit scoring models and software. 

They analyze consumer credit data from the three major bureaus involved in credit reporting (Experian, Equifax, TransUnion) to produce a credit score that helps lenders better understand the risk associated with specific consumers when they’re applying for credit cards or loans. 

FICO has remained the industry leader by far, with over 90% of lenders using FICO scores. 

So, how do the two differ? VantageScore still has a set credit scoring system. However, while FICO determines the impact certain activities have on your score based on a percentage system, VantageScore determines changes to your credit score with an influence system

Items like credit history, credit utilization, and other factors from credit reporting bureaus will impact you differently with VantageScore. 

Rather than the FICO score rating system outlined above, the latest models for VantageScore rate consumer credit scores as such: 

  • 781-850: Excellent
  • 661-780: Good
  • 601-660: Fair
  • 500-600: Poor
  • 300-499: Very Poor

So, how much does the average score change when switching over to the VantageScore model? According to Forbes Advisor, the average VantageScore in the US is 697.10 

Which City/Town in the US Has the Highest Credit Score?

Seeing the different scores across the nation can offer exciting insight into consumer financial activity and health. For the data presented here as well as the states with the best credit scores below, we’ll be using the 2021 Credit Trends in the US by City and State from FICO.11

According to FICO, the metropolitan area with the highest average credit score is the San Francisco Bay Area, which has an average credit score of 746. 

This is followed by the average scores in the states below:

  • Minneapolis-St. Paul Area: 743
  • Boston Area: 742
  • Nassau–Suffolk, NY Area: 739
  • Orange County: 736
  • Pittsburgh Area: 732
  • Denver Area: 731
  • San Diego Area: 729
  • Washington DC Area: 729
  • Chicago Area: 725

Average Credit Score of Home Buyers in 2021

The average credit score of home buyers is a higher credit score than the average credit score in the US. This is due to the fact that the stronger your credit score and the better your credit history, the easier it is to get approved for a mortgage with desirable interest rates and terms. 

According to a 2021 report from ValuePenguin (which utilized LendingTree data to evaluate the credit score of homeowners who took out a loan between January and December 2020), the average credit score of home buyers was 731.12

Which States Have the Highest Credit Scores?

Now that we know which cities have the best credit scores, which states have the highest scores? While one might reasonably assume that the average scores of the cities above would reflect the states with the highest scores, this is not actually the case. 

Rather, the states11 with the highest scores include:

  • Minnesota: 742
  • Vermont: 738
  • North Dakota: 736
  • Wisconsin: 736
  • New Hampshire: 735
  • Massachusetts: 735
  • South Dakota: 735
  • Washington: 734
  • Nebraska: 733
  • Hawaii: 733

Which States Have the Lowest Credit Scores?

According to a report from CNBC13, the states that have the lowest of the bad credit scores throughout the US include:

  • Alabama: 686
  • Arkansas: 690
  • Georgia: 689
  • Louisiana: 684
  • Mississippi: 675
  • Nevada: 695
  • New Mexico: 694
  • Oklahoma: 690
  • South Carolina: 689
  • Texas: 688

Financial Products That Don’t Require Credit

Surprisingly, some loans and other types of financing don’t require credit checks or a credit score. These include:

  • Reverse mortgages: no credit score requirements
  • Starter credit cards: some allow bad credit, others have no credit check at all
  • Buy now, pay later companies: no credit check
  • Payday loans: no credit check
  • Cash advances: no credit check
  • Some credit union personal loans: varies by lender, but some allow low credit scores or new credit

Footnotes:

1. https://www.fico.com/en/resource-access/download/38456

2. https://www.fool.com/the-ascent/credit-cards/articles/22-of-americans-dont-have-a-credit-score-heres-why/

3. https://www.cnbc.com/select/what-credit-score-should-you-have/#:~:text=Only%20about%201.6%25%20of%20the,much%20as%20you%20may%20think.

4. https://www.marketwatch.com/story/59-of-americans-have-a-credit-score-above-700-why-that-doesnt-mean-theyre-in-good-shape-financially-2020-01-14

5. https://www.fico.com/blogs/average-us-fico-score-ticks-706

6. https://www.forbes.com/advisor/credit-cards/how-do-you-measure-up-average-credit-score-by-age-and-location/

7. https://www.americanexpress.com/en-us/credit-cards/credit-intel/credit-score-by-age-state/

8. https://shiftprocessing.com/credit-score/#race

9. https://www.cnbc.com/select/women-men-credit-score-comparison/#:~:text=According%20to%20credit%20bureau%20Experian’s,the%20second%20quarter%20of%202015.

10. https://www.forbes.com/advisor/credit-score/average-credit-score/

11. https://www.fico.com/en/resource-access/download/38456

12. https://www.valuepenguin.com/average-credit-score

13. https://www.cnbc.com/select/average-credit-score-by-state/

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