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The national average credit score sits at an all-time high of 716, unchanged from a year ago, according to a report from FICO, developer of one of the scores most widely used by lenders.

However, this marks the first time since the Great Recession that scores did not improve year over year, the report found. That’s in part due to a small uptick in missed payments, elevated consumer debt levels and an increase in the number of consumers opening new credit cards or new lines of credit.

“These moderate changes toward more risky behaviors have contributed to the leveling off of higher average FICO Scores,” according to the report.

FICO scores range from 300 to 850. A good score generally is above 670, a very good score is over 740 and anything above 800 is considered exceptional.

Average nationwide credit scores bottomed out at 686 during the housing crisis more than a decade ago, when there was a sharp increase in foreclosures. They steadily ticked higher until the pandemic, when government stimulus programs and a spike in household saving helped scores jump to a historical high.

Where to find the highest, and lowest, credit scores

When the data is broken down by state, residents of Minnesota have the highest average credit score nationwide, at 724, followed by New Hampshire, Vermont and Massachusetts, according to a separate report by WalletHub based on TransUnion data.

On average, residents in these states are less likely to be opening new credit, have fewer missed payments and a lower ratio of debt to total credit, FICO also found.

With an average credit score of 662, Mississippi residents had the lowest ranking across the country, along with Louisiana, Alabama and Arkansas.

Why your credit score is important

Generally speaking, the higher your credit score, the better off you are when it comes to getting a loan. You’re more likely to be approved, and if you’re approved you can qualify for a lower rate, potentially saving thousands of dollars in interest charges, according to FICO.

An average score of 716 by FICO measurements means most lenders will consider your creditworthiness “good” and are more likely to extend lower rates.

“Every 20 points or so can make a really big difference,” especially with mortgage rates, said Ted Rossman, senior industry analyst at Bankrate and CreditCards.com.

For example, borrowers with a credit score over 760 could lock in a 30-year fixed mortgage rate of 5.75%, but it jumps to 7.3% for credit scores of 640 or below. On a $300,000 loan, paying that higher rate adds up to an extra $113,000 over the lifetime of the loan, according to data from FICO.

“Something similar plays out on a smaller scale with car loans,” Rossman said. “It’s at least a few hundred dollars a month and potentially more than $100,000 over the long haul.”

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The best way to increase your credit score comes down to paying your bills on time or reducing your credit card balance, Rossman said. 

Rossman advises borrowers to keep revolving debt below 30% of their available credit to limit the effect that high balances can have. Asking for a higher credit limit or making an extra payment in the middle of the billing cycle can help.

“A lot of this is more of a marathon than a sprint,” he said.

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