Your credit scores affect almost every aspect of your life. They are used when applying for a mortgage loan, a car loan, or a credit card. Even homeowners and mobile phone companies consider your credit scores when approving you. How do your credit scores compare to those of people in your state? What about the country?
FICO Score Ranges
800-850: Excellent
740-799: Very Good
670-739: Good
580-669: Fair
Below 580: Poor
State Averages
Minnesota ranks first with an average credit score of 742. Mississippi ranks last with an average credit score of 681.
The remaining top ten states with the highest average credit scores are: Vermont (736), Wisconsin (735), New Hampshire (734), Washington (734), North Dakota (733), South Dakota (733), Massachusetts (732), Nebraska (731), and Oregon (731).
All these credit scores are considered prime or near-prime credit on the FICO scale. Those with prime credit scores typically have an easier time obtaining credit and will receive more favorable terms when approved.
Nine other states have the lowest average credit scores, which are Louisiana (689), Alabama (691), Oklahoma (692), Texas (692), Georgia (693), Arkansas (694), South Carolina (693), New Mexico (699), and West Virginia (699).
Tips for Improving Your Credit Scores
You can work on improving your credit scores no matter where you live. Since payment history is the biggest factor affecting your credit scores, paying your bills on time is the best thing you can do to improve your credit scores. Settle overdue accounts and deal with collections.
Reduce the amount of credit you are using. Having a high balance on your credit cards will also impact your credit scores. While it may be easier to budget when you only pay the minimum on your credit cards each month, this is not the best for your credit scores. Aim to pay down your credit card balances to less than 30% of your credit limit. The lower, the better. Maintaining very low credit card balances will help increase your credit scores. This shows lenders that you can manage credit responsibly and not let it get out of control.
Apply for new credit only when necessary. Although each new credit card will slightly affect your credit scores, the real damage in opening multiple credit cards is the risk of accumulating a large balance and missing payments. Minimize the number of credit cards you apply for.
Monitor your credit scores with a free credit monitoring service like Credit Karma, Credit Sesame, or WalletHub. You can stay informed about changes to your credit scores and understand the factors affecting your credit scores. You should also review your full credit report annually at AnnualCreditReport.com. Check your credit report to ensure all information is accurate and report any errors to the credit bureaus. An accurate credit report is also essential for improving your credit scores.
Frequently Asked Questions (FAQs)
Why are the average credit scores in Texas and some southern states lower?
Lower credit scores in some southern states do not mean that people in those states are less creditworthy. According to one study, lower credit scores in southern states are due to complex reasons including lower-rated educational systems, greater reliance on government assistance, and higher bankruptcy filing rates.
Is
Is there anyone with the perfect FICO score of 850?
While achieving a perfect credit score is difficult, it’s not impossible. Approximately 1.2% of Americans have a credit score of 850.
Are there other credit scores besides FICO?
Yes, there is VantageScore, which ranges from 300 to 850. Although there are some similarities, there are also some notable differences between FICO and VantageScore.
Source: https://www.thebalancemoney.com/the-average-credit-score-by-state-4161310
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