The national average FICO score has dropped to 715, a new report from decision managment company Fair Issac Corporation (NYSE: FICO) says. This is down two points from 2024, and marks the second year in a row that credit scores have declined.
Amy Crew Cutts, president of economics and policy consulting firm AC Cutts & Associates LLC, says that the drop can be tied to the pandemic.
“Since the start of 2020, the US consumer has been on a wild ride economically… Windfall payments landed in consumer bank accounts, student loans payments were suspended, and mortgage relief was made easy… Later came fast rising prices, then higher interest rates, and now, in 2025, the remaining debts have come due,” she said in the report.
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In order to keep up with the high cost of living and the added stress of large student loan payments, FICO reports that over the last 12 months, 24% of Americans have opened a new credit card, and 13% have taken out a personal loan. For many, credit has become a lifeline during this period of economic uncertainty.
This increase in utilization has contributed to lower average credit scores, but it’s not the only factor at play. According to FICO, delinquency rates on auto loans, student loans, personal loans, and credit cards are also up.
The report found that student loan delinquency rates hit an all-time high as of April, when 3.1% of the population, or 6.1 million consumers, had a delinquency note added to their files. Additionally, the auto loan delinquency rate is up a relative 24% since 2021.
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Delinquency rates are relevant because they are the most important part of the FICO score “Payment History” category, accounting for 35% of the calculation. Consumers with at least one reported delinquency saw an average credit score drop of 69 points.
“Delinquency rates on auto loans, credit cards, and personal loans are at or near their highest levels since 2009, during the Great Recession— and are more consistent with an economy in recession than one still in expansion,” Cutts said.
Gen Zers have been hit the hardest by credit score fluctuations, the report found. While younger generations typically experience the largest year-over-year increase in scores because they have the lowest scores to begin with, Gen Zers currently have a national average score of 679, which is 39 points lower than other age groups.