FICO credit scores declined last month for the first time in a decade. Is this a troubling trend, or no big deal?
Ethan Dornhelm, Vice President with FICO provides some context. The average score went from 718 to 717, a drop of only one point. He says that this is not a "blinking red flag" and that average credit scores are still higher than they were before the pandemic. He says that smart consumers will know what their credit scores are and actively work to try to improve them.
www.myfico.com/free
Bruce McClary, Senior VP with the National Foundation for Credit Counseling, says that, in some cases, consumers have been forced to make some painful decisions to use debt to make ends meet in the face of inflation and higher interest rates. Further compounding the issue for some household budges is the absence of pandemic-era stimulus checks from the government - which actually drove up credit scores in 2020 - as well as deferred collections and forbearance that have expired.
www.nfcc.org