However, it has only dipped eight points since 2007, just before the housing boom turned to housing bust.
The average credit score was 755 in August 2008 and 750 in August 2009.
Despite all the recent turmoil in the credit markets, which you think would have lowered credit scores even more, consumers have taken an active role in reducing debt, resulting in an improvement in their credit scores.
This has countered some of the negative effects related to foreclosures, short sales, and other derogatory events of late.
Meanwhile, the latest data from Fico (October 2008), the creator of the Fico score, revealed that the average Fico score is 713.
Unfortunately, this data isn’t very up-to-date, so it’s hard to say what impact the financial crisis has had on Fico scores.
Either way, you would have to assume that both the VantageScore and Fico score algorithms will be updated as a result of the latest crisis.
Though the updates are unknown, I would guess that because of all the foreclosures and related negative actions in recent years, credit scores for those who avoided all the problems will rise, while those who made missteps won’t be punished as badly as they may have been in the past.