Tag: Creditworthiness
Loans and Lending
The average American’s FICO score rose to 710 in 2020. Here’s what FICO scores aren’t telling you
The average FICO score of an American consumer rose to 710 in 2020, an all-time high. At first glance, this number defies intuition. Are consumers better qualified than ever to take on additional debt? If so, why did 71.7% of banks tighten their underwriting standards in the 3rd quarter? If borrowers are truly low risk, one would expect to see low unemployment, robust economic growth, and high consumer confidence. Since none of those things are present, there’s something FICO isn’t telling us. As with so many aspects of life, 2020 is different. There are other dynamics at play, and they…
