Average FICO Credit Score Remains Stagnant at 716
There’s good news and bad news when it comes to today’s credit scores. According to FICO, the average credit score is currently 716 — matching what it’s been since April 2021. Notably, this is the first time in 10 years that the average FICO credit score didn’t increase year-over-year. The previous example was from 2012 when the average was 689 for two consecutive Octobers (plus a brief increase to 690 in April of that year).
This stagnation comes as scores made significant jumps earlier in the pandemic. Between April and October of 2022, average scores increased from 708 to 713. Then, scores rose again to 716 in April 2021, where they’ve remained since.
Although the overall average score stayed flat over the past 12 months, year-over-year score increases among those with scores between 550 and 699 did still rise. Those with scores in the 550 to 599 range saw the greatest increase, with the average score climbing 7 points between April 2021 and April 2022. What’s more, this builds on the impressive 20-point increase this bracket saw in the year prior to that. Similarly, the average score among those in the 600 to 649 range climbed 3 points in the last year following a 16-point gain between 2020 and 2021.
Elsewhere in FICO’s latest report, it was discovered that the instance of missed payments was on the rise. This report shows that 15% of adults have payments that are more than 30 days past due, making a 1-percentage point increase from this time last year. This includes 5.8% who had bills that were more than 90 days past due compared to 5.4% in 2021. Meanwhile, consumer debt is also increasing. In April 2022, the average credit card utilization rate (meaning the percentage of a credit limit that a consumer is currently using) was 31%. That’s up slightly from the 30% recorded last April — but is down from the 33% observed in 2020.
Overall, while it’s a bit disappointing that we weren’t treated to a new record average FICO score (so far) this year, it’s essential to realize how much growth has taken place over the recent years. For example, looking back at FICO’s data from 2005 shows a 28-point increase in average score. Surely, this rising trend is due in part to the number of free credit tools now available to consumers, which also provide greater resources and education. Ultimately, while there are concerns mounting — from increasing utilization and missed payments to larger economic uncertainties — there’s still reason to believe that the presence of these credit tools will lead to new record highs in the month/years ahead.