- ORIGINAL NEWS
Credit scores decrease for the first time in a decade as more borrowers fall behind on payments
- SUMMARY
The average American’s credit score has dropped to 717, down from its recent high of 718.
This decline is due to an increase in missed payments and higher consumer debt levels.
Consumers have been relying more heavily on credit cards, with the average credit card utilization rate rising to 35%.
Additionally, over 18% of borrowers have missed at least one payment in the past 30 days.
This trend is likely driven by rising interest rates and higher prices, which have put a strain on Americans’ financial situations.
Government stimulus programs and savings built up during the pandemic may also have been depleted.
As a result of lower credit scores, borrowers may have difficulty getting approved for loans or may face higher interest rates.
Keeping your credit score high by paying bills on time and managing debt effectively is crucial in this economic climate.
- NEWS SENTIMENT CHECK
- Overall sentiment:
negative
Positive
“The national average credit score, which has steadily increased over the last decade, fell to 717 from a high of 718 in the beginning of 2023, according to a report from FICO, developer of one of the scores most widely used by lenders.”
“Some of the best ways to improve your credit score come down to paying your bills on time every month and keeping your utilization rate, or the ratio of debt to total credit, below 30% of your available credit.”
Negative
“Credit scores had steadily improved for a decade, but increases in missed borrower payments and rising consumer debt levels are starting to take a toll.”
“As of October, the average credit card utilization was 35%, up from 33% a year earlier, and the share of borrowers with a 30-day past-due missed payment against their credit accounts was also higher.”