Credits scores have been on the move & the odds are its good news for you
Bottom Line: 2018 has been a year of reforms for the credit rating agencies. Changes to what impacts your credit score negatively have been made along with a major push by regulators to get Experian, Equifax and TransUnion to expedite reviews of widespread reporting issues fixing problems along the way. According to a government estimate in 2017, over 20% of Americans had “material” issues on their credit reports that were impacting scores. In other words, mistakes in your credit report that probably hurt you – without you even knowing it. These reforms along with the best economy in a generation have combined to create dramatically improved profiles and scores for millions of Americans. Here are a couple highlights...
Percentage of Americans in collections (changes year over year):
- Down 24% to 25 million
- Debt in collections down $11 billion
Credit score change:
- No change: 12%
- Down: 20%
- Up 68%
Not bad, right? More than two-thirds of Americans have seen their credit score improve over a year ago. For those who’ve experienced a gain the average improvement has been about 18 points. But that’s an average, there are some incredible recovery stories. For example, 14% of Americans have seen a boost of 40 points or more to their credit scores over last year!
For this reason, it’s possible for many Americans to obtain better terms on credit today than a year ago, despite higher interest rates over a year ago. If you haven’t checked your credit score in awhile, it’s probably worth your while to do so. The odds are it’s good news and could help you to start saving right away with refi’s before rates head higher.