Credit scores continue to decline as delinquency continues to plague borrowers.
The latest Credit Insights FICO report shows that the US credit rating fell to 714 in March, down one point from a year ago and two points from late 2024.
The recent decline in the US credit score, which has been steadily declining for the past several years, is small, but underscores the growing disparity in the credit health of Americans. While some borrowers are falling behind — especially young buyers hit by delinquent student loans and homeowners struggling with mortgage payments — others are thriving. Nearly half (48%) of consumers now have a credit score of 750 or higher, according to FICO.
That split comes as overall household debt continues to rise and credit card balances remain near record highs, according to data from the Federal Reserve Bank of New York.
The result is what analysts describe as a “K-shaped” credit landscape: borrowers with strong credit continue to see improvements, while consumers with low scores are regressing toward pre-pandemic levels.
“What makes this so interesting is that at the same time we’re seeing a record share of consumers who are showing strong, consistent credit behavior,” said Ethan Dornhelm, head of FICO statistics, the report said. “The result is a credit market that is very challenging for some and very beneficial for others.”
Younger borrowers take priority
About 14% of consumers aged 18 to 29 saw their credit scores drop by at least 50 points between October 2024 and October 2025, compared to about 10% of the general population. The decline is largely related to student loan repayment struggles, as many young borrowers navigate payments for the first time without the safety net that existed during the pandemic.
Some of those pandemic-era protections lasted more than four-and-a-half years, so when missed payments began to have negative consequences again in the fall of 2024, the impact was huge. About one-third of borrowers with delinquent payments, or about 7.1 million people, now have new delinquent student loans on their credit reports, FICO reports. For those borrowers, scores have dropped by an average of 62 points since early 2025.
Although student loan repayments have caused a significant increase in crime, there are signs that the situation may be starting to stabilize.
FICO data shows that student loan delinquencies have “declined” in recent months after an initial spike when missed payments began hitting credit reports again in early 2025. The delinquency rate increased by just 0.1% between April and October 2025. At the same time, many other types of debt, including credit cards and personal loans, are showing signs of post-pandemic recovery.
Mortgage delinquencies, however, continue to rise, suggesting that some households are still under pressure from higher borrowing costs and housing costs. By October 2025, the 30-day delinquency rate had risen to 4.8% — close to the pre-pandemic rate of 5%, according to FICO. Mortgage rates, which have soared beyond pandemic-era lows in recent years, have made home ownership and refinancing more expensive.
“Mortgage markets present a complex picture at present,” the report said. “As crime continues to rise toward pre-pandemic levels, the sector needs continued vigilance during this time of continued market change.”
While the average FICO score of 714 remains high by historical standards, the data shows the divide between successful and struggling borrowers is likely to continue to grow, shaping the way consumers access financial products in the coming months and years.
More from Mali:
Student Loan Defaults Are So Bad That They Are Hurting America’s Credit Rating
Few Americans Have Perfect Credit Scores. Experts Say You Don’t Need Him
‘Nepo Baby’ Credit Benefits Don’t Last, Study Finds
