The average U.S. credit score fell to 714 in March, marking a one-point decline from the previous year and a two-point drop since late 2024, according to FICO’s latest Credit Insights report. This modest decrease highlights a growing “K-shaped” divide in consumer credit health: while 48% of Americans now hold scores of 750 or higher, others are slipping behind due to rising delinquencies in student loans and mortgages.
Younger borrowers are facing the steepest challenges. Approximately 14% of consumers aged 18 to 29 saw their credit scores drop by at least 50 points between October 2024 and October 2025, largely driven by the resumption of student loan payments. After more than four years of pandemic-era protections, missed payments began impacting credit reports again in early 2025, causing scores for affected borrowers to fall by an average of 62 points. However, recent data suggests student loan delinquencies are stabilizing, with only a 0.1% increase in the delinquency rate between April and October 2025.
Conversely, mortgage delinquencies continue to climb, reaching 4.8% in October 2025—near pre-pandemic levels—as high borrowing costs strain homeowners. Ethan Dornhelm, head of scores analytics at FICO, noted that the credit market is becoming simultaneously more rewarding for responsible borrowers and more challenging for those struggling with debt. With overall household debt nearing record highs, this divergence in creditworthiness is expected to shape lending landscapes in the coming years.