National Average Credit Score

Let's face it, many of us are just plain competitive and some of us are curious.  Then there are those that are worried about qualifying for a loan.  So what do these groups have in common when it comes to credit scores?  They all want to know how they compare to the national average credit score.

We're not going to hold you in suspense - the national average credit score is 692.  That value is based upon research conducted by Experian, one of the three major credit reporting and scoring agencies.  In fact, Experian uses the Fair Isaac Risk Model.  You may be familiar with what are called FICO(r) credit scores.  FICO is the credit model developed by Fair Isaac.

Credit Score Scales and Calculations

We've talked about credit scores in depth in our article About Credit Scores, but some of the concepts explained there are worth briefly repeating.  This explanation should help you to better understand how you compare to national average credit score.

Credit scores are on a scale from around 300 - 850, with 850 being the highest credit score possible.  To give you a feel for the extremes, while the national average credit score is 692, only 13% of the nation's population has scores above 800.  At the other extreme, roughly 15% of the population has a credit score lower than 550.  In general, a good credit score is anything above 700.

So that gives you two data points to think about.  The national average credit score is 692 and a good credit score is anything above 700.  Does that mean that half of all Americans have a credit score below the national average?

The short answer is No.  In fact, 58% of Americans have credit scores above 700.  The national average is only 692 because the average is being pulled down by some very low credit scores.  Remember, we're not talking about the median score (half above and half below), we're talking about an average score.

Factors Affecting Credit Scores

There are a total of five bits of information that go into the calculation of your FICO credit score.  But there are just two pieces of information that account for 65% of your total score:

• Payment History (35% of credit score) - Your payment history is determined from your payment patterns to creditors or lenders.  Basically, this component of the score is a reflection of how frequently you pay your bills or loans back on time.
• Outstanding Debt (30% of credit score) - The second major factor is how much debt you have outstanding.  The more debt you have outstanding, relative to what creditors think you can financially handle, the lower your credit score.

National Credit Score Facts

Now that you have a fundamental understanding of credit scoring, we thought it would be fun to share some of the facts have been gathered from the Experian National Score Index (October  2007).  These credit score facts are based on information compiled from a large database of credit scores in the United States.  This means the term national average credit score and average US credit score can be used interchangeably.

From the Experian database, we know the following facts:

• Consumers in the state of Texas have the lowest average credit score in the nation, with a score of 666.  This is five points lower than Mississippi, which has the second lowest average in the US.
• Consumers in the state of Minnesota have the highest average credit score in the nation with a score of 721.  That's nearly 60 points higher than Texas.
• There are 19 states that have an average credit score below the national average.
• There are 31 states plus the District of Columbia that have an average credit score above the national average.

Finally, to satisfy all of those that have a need to understand how their credit score stacks up against the national average and their state, we've put together the following credit score tables:

Credit Scores Below the National Average

Credit Scores at or Above the National Average

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