Learn 10 States With The Best And Worst Credit Scores
Your credit score is a three-digit figure calculated using information from your credit report. When you apply for a new credit account, such as a loan, a lender will normally look at your credit score, among other things, to decide your eligibility, loan terms, and interest rate.
The most prominent credit scoring models, VantageScore and FICO, range from 300 to 850. According to a July 2021 VantageScore study, Minnesota had the greatest average credit score (724), while Mississippi had the lowest average score (662). We’ll go through the 10 states with the highest and lowest credit ratings, as well as advice on how to improve your credit score.
10 States with the Best Credit Scores
High credit scores frequently indicate a positive payment history and a low credit usage ratio—the ratio between your total balance and your credit limit. Both of these characteristics are frequently associated with higher amounts of income, which allow people to finance and pay their debt commitments on time.
For example, the states with the highest credit scores had greater median salaries than the national average: According to Census data, the median average income of all ten states with the best credit scores in 2018 was $69,570, compared to the national median average of $61,937.
Only two of the ten states, South Dakota and Vermont, had median incomes that were lower than the national average. Furthermore, the average mortgage delinquency rate for all ten states was lower than the national average in March 2021, according to National Mortgage Database data. The top ten states’ average rate was 0.57%, while the national default rate was 0.80%. According to VantageScore, the ten states with the best credit scores as of July 2021 are as follows.
1. Minnesota – 724
Minnesota has had the highest average credit score in the United States since July 2020. The state’s median income was $70,315 in 2018, according to Census data, while its average mortgage delinquency rate of 0.50% was lower than the national average, according to National Mortgage Database data.
2. Vermont – 719
Despite having a median income of $60,782 in 2018, which was less than the national average, Vermont had one of the highest average credit scores.
3. New Hampshire – 719
According to National Mortgage Database data, New Hampshire has the same mortgage delinquency as the national average of 0.80%. However, according to December 2020 Urban Institute credit data, the state has a lower vehicle loan delinquency rate than the national average.
