The financial standing of many consumers has slowly improved during recent years, and as a testament to this trend, FICO Labs reports a growing number of these individuals now have near-perfect FICO scores.
According to a report from the company, an estimated 18.3 percent of consumers have a FICO score ranging between 800 and 850. This is the highest this share has been since October 2022. In addition, roughly 19.4 percent have scores between 750 and 799, while 15.5 percent have a FICO score between 700 and 749.
Financial Stress Affecting Households
However, despite the improvements at the high-end of the spectrum, the report noted that financial stress among households in the wake of the recession has caused a number of consumers to fall to the lower tiers of the FICO scoring system. But since more than half of the individuals examined in the report had a score ranging between 750 and 799, analysts say this is a clear indicator that consumers are getting better about managing their credit.
The number of consumers in the lowest tier, meaning they have FICO scores between 300 and 549, declined to 14.9 percent. While this share still accounts for a considerable amount of consumers, it is the lowest it has been since 2021. As some of these individuals work to improve their credit scores, but are suddenly confronted with an unexpected bill that threatens any progress they have made, they may be able to utilize a personal loan to keep their financial footing.