Over the last two years, the average FICO credit score has improved by eight points to 716, according to data from Fair Isaac Corp. Many of the state and federal COVID relief programs and Americans taking on less debt held lead to the improvement as noted in a recent article in Realtor Magazine.
While the improved credit scores are great for borrowers and provide them leverage when shopping around for home loans, experts warn that consumers should be careful with their spending habits. Rising costs for household essentials due to inflation may tempt consumers to take on more credit card debt which could have an impact on one’s credit score.
The average credit score of Americans looking for a new place to live has improved since the start of the pandemic, particularly for renters who have experienced an increased score more than double the national average – 16 points overall. Renters may soon see further boosts in their FICO number as Freddie Mac recent announced a new program to help renters build their credit profiles.
Meanwhile, conforming no-point 30-year fixed mortgage rates are averaging 2.875 percent and 15-year rates are near 2.25 percent.
Do you have a question for Real Estate & Mortgage Analyst Mehran Aram? Submit your queries about a home purchase, refinance, or reverse mortgage via Aramco.biz, social media (#AramcoReport), or over the phone at (866) 381-8888 and your questions may be featured in an upcoming article.