COSTA MESA, Calif.,
May 20, 2019 /PRNewswire/
-- Experian®, the leading global information
services company, released key findings from its annual State of
Credit report today. To compile the report, Experian looked
closely at today's consumer credit behaviors and compared them with
those in 2008 — the year the United
States headed into its worst recession in 80 years.
Experian's research showed that, while Americans' credit scores are
not as high as they were at the start of the economic downturn,
2018 marks the largest year-over-year
increase since 2008, with an average VantageScore®1 of
680.
"We're continuing to see the positive effects of economic
recovery, through improved credit scores and lower delinquency
rates," said Michele Raneri, vice
president of analytics and business development at Experian. "Since
the recession, responsible credit card behaviors and lower debt
among younger consumers are driving an upward trend in average
credit scores across the nation. Over the past 10 years, those 18
to 21 increased their credit scores by 23 points on average
compared with those 18 to 21, ten years ago."
Highlights of Experian's State of Credit report:
10-year
comparison
|
2008
|
2017
|
2018
|
Average number of
credit cards
|
3.40
|
3.06
|
3.04
|
Average credit card
balances
|
$7,101
|
$6,354
|
$6,506
|
Average number of
retail credit cards
|
3.03
|
2.48
|
2.59
|
Average retail credit
card balances
|
$1,759
|
$1,841
|
$1,901
|
Average
VantageScore[1,2]
|
685
|
675
|
680
|
Average revolving
utilization
|
28%
|
30%
|
30%
|
Average nonmortgage
debt[3]
|
$23,929
|
$24,706
|
$25,104
|
Average mortgage
debt
|
$191,357
|
$201,811
|
$208,180
|
Average 30 days past
due delinquency rates
|
5.4%
|
4.0%
|
3.9%
|
Average 60 days past
due delinquency rates
|
2.9%
|
1.9%
|
1.9%
|
Average 90+ days past
due delinquency rates
|
7.1%
|
7.3%
|
6.7%
|
Generational divide
The downturn impacted the
financial behaviors of consumers of all ages differently. When
comparing the credit behaviors of different age groups in 2008 and
2018, Experian found:
- As the oldest group, those aged 72 and older experienced some
significant changes. While this group continues to have higher
credit scores than any other, they saw the most significant drop in
average credit scores, with a decrease of 40 points (772 in 2008
compared with 732 in 2018). This group also had the most
significant increase in credit card balances, up $767 in 2018 to $4,703 (compared with $3,936 in 2008). They also experienced the
largest increase in mortgage debt, up $29,602 for a total of $160,735 in 2018 (compared with $131,133 in 2008).
- Those aged 51 to 71 continue to have more credit cards (4.02 in
2008 compared with 3.48 in 2018) and retail cards (3.41 in 2008
compared with 2.85 in 2018) than any other age group. They have an
average credit card balance of $7,637, compared with $8,127 in 2008. In addition, this group has the
second-highest amount of nonmortgage debt of all groups (behind
those aged 36 to 50) at $27,438,
compared with $27,028 in 2008.
- While those aged 51 to 71 have more credit cards and retail
cards than any other age group, those aged 36 to 50 continue to
have higher balances on credit cards ($8,897 in 2008 and $8,012 in 2018) and retail cards ($2,032 in 2008 and $2,192 in 2018). This group also has consistently
carried higher nonmortgage debt ($30,179 in 2008 and $31,174 in 2018) and mortgage debt ($209,442 in 2008 and $239,009 in 2018) than other age groups.
- Consumers aged 22 to 35 saw the second-largest jump in average
credit scores since 2008, increasing 15 points to 644 from 629.
This group has lowered their credit card balances ($5,583 in 2008 to $4,593 in 2018) while increasing their average
mortgage debt ($192,554 in 2008
compared with $209,713 in 2018).
- Since 2008, those aged 18 to 21 increased their average balance
on credit cards ($2,056 in 2008
compared with $2,259 in 2018) and saw
a 23-point increase in credit scores — the largest of any other age
group (616 in 2008 compared with 639 in 2018). This is considered a
near-prime score, approaching the typical prime lending criteria of
661.
Credit behaviors of males and females
When looking at
how the financial downturn impacted the credit card behaviors of
males and females, Experian's State of Credit report
revealed:
2008
|
10-year
comparison
|
Female
|
Male
|
U.S.
average
|
VantageScore
|
689
|
684
|
685
|
Number of credit
cards
|
3.43
|
3.40
|
3.40
|
Average credit card
debt
|
$6,967
|
$7,331
|
$7,101
|
2017
|
VantageScore
|
680
|
675
|
675
|
Number of credit
cards
|
3.15
|
3.01
|
3.06
|
Average credit card
debt
|
$6,314
|
$6,581
|
$6,354
|
2018
|
VantageScore
|
684
|
680
|
680
|
Number of credit
cards
|
3.13
|
2.98
|
3.04
|
Average credit card
debt
|
$6,452
|
$6,752
|
$6,506
|
Year-over-year shifts
Today, the nation's average
credit score is 680 — five points higher than the 2017 average of
675. The average number of credit cards for consumers decreased
slightly year-over-year to 3.04 (compared with 3.06 in 2017), while
credit card balances increased $152
to $6,506.
"With this annual report, our goal is to provide insights that
help consumers make more informed decisions about credit use to
change their financial habits and improve financial access," said
Rod Griffin, director of consumer
education and awareness at Experian. "Understanding the factors
that influence their overall credit profile can help consumers lead
financially empowered lives."
Annual rankings
As part of the annual study, Experian
also ranked states by their average credit score in 2018.
Minnesota, South Dakota, Vermont, New
Hampshire and Massachusetts
are the top-ranking states in the nation, with prime credit scores
of 703 or more. Mississippi,
Louisiana, Nevada, Georgia and Texas are the five lowest-ranking states, with
credit scores below 659.
Top 5 highest
average credit scores by state
|
|
2018 highest
rankings
|
State
|
2018 average
VantageScore
|
1
|
Minnesota
|
713
|
2
|
South
Dakota
|
707
|
3
|
Vermont
|
705
|
4
|
New
Hampshire
|
704
|
5
|
Massachusetts
|
703
|
Bottom 5 lowest
average credit scores by state
|
|
2018 lowest
rankings
|
State
|
2018 average
VantageScore
|
1
|
Mississippi
|
652
|
2
|
Louisiana
|
653
|
3
|
Nevada
|
659
|
4
|
Georgia
|
659
|
5
|
Texas
|
659
|
Analysis methodology
Experian's analysis is based on a
statistically relevant sampling of Experian's consumer credit
database, available on the Experian Ascend Technology
PlatformTM, from Q2 2008, 2017 and 2018. Analyzed credit
files did not contain personally identifiable information. Credit
scores are based on Vantage Score (range 300 – 850).
About Experian
Experian is the world's leading global
information services company. During life's big moments — from
buying a home or a car, to sending a child to college, to growing a
business by connecting with new customers — we empower consumers
and our clients to manage their data with confidence. We help
individuals to take financial control and access financial
services, businesses to make smarter decisions and thrive, lenders
to lend more responsibly, and organizations to prevent identity
fraud and crime.
We have 16,500 people operating across 39 countries and every
day we're investing in new technologies, talented people and
innovation to help all our clients maximize every opportunity. We
are listed on the London Stock Exchange (EXPN) and are a
constituent of the FTSE 100 Index.
Learn more at www.experianplc.com or visit our global
content hub at our global news blog for the latest news and
insights from the Group.
Experian and the Experian marks used herein are trademarks or
registered trademarks of Experian and its affiliates. Other product
and company names mentioned herein are the property of their
respective owners.
[1]VantageScore is a registered trademark
of VantageScore Solutions,
LLC.
[2]VantageScore range is 300 to
850.
[3]Average debt for
this study includes all credit cards, auto loans and personal
loans/student loans.
Contact:
Amanda
Irving
Experian Public Relations
1 714
830 7923
amanda.irving@experian.com
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SOURCE Experian