FICO: Average credit score reaches all-time high of 704

Consumers’ credit savvy, lenders’ tighter underwriting standards boost scores

Brady Porche
Managing Editor
Personal finance journalist with an eye for industry news

FICO: Average credit score reaches all-time high of 704

The average credit score among U.S. consumers has reached an all-time high of 704, according to a new report from FICO.

The new average is four points higher than the mean score of 700 that consumers attained in April 2017, when FICO last calculated a U.S. average. Experts say a credit score of 700 or higher is sufficient to qualify for most credit cards and secure favorable interest rates on mortgages and other loans.

Ethan Dornhelm, vice president of scores and predictive analytics at FICO, wrote in a Sept. 24 blog post that consumers' growing awareness and education regarding credit could be a driver of the overall score improvement. He noted a February 2018 study by FICO and Sallie Mae that revealed people who frequently check their scores tend to have higher scores and make better financial choices.  

Additionally, lenders have tightened their underwriting standards in the wake of the Great Recession. The average FICO score fell to a low point of 686 in October 2009.

See related: 18 things that hurt your credit score 

Many consumers have gotten a credit score boost from changes in credit reporting standards that have gone into effect within the past two years. For instance, the three major credit bureaus – Equifax, Experian and TransUnion – no longer include tax liens or civil judgments in consumers’ credit reports. 

Additionally, collection agencies and debt buyers are no longer allowed to report medical debts that are less than 180 days old. 

FICO's new data shows that 23 percent of consumers had one or more collection agency accounts on file as of April 2018, down from 25.8 percent in April 2017. 

But Dornhelm also noted that delinquencies on bank-issued cards have ticked upward in recent years. The bank card delinquency rate rose from 7.1 percent in April 2016 to 8.2 percent in April 2018, per FICO. 

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Updated: 02-21-2019