Delinquencies Declined Across All Days Past Due (DPD) Categories compared to March 2024, but Still Remained Higher than April 2023
SAN FRANCISCO —May 29, 2024— VantageScore, a leading national credit-scoring and data insights company, today released its April 2024 CreditGauge, a monthly analysis highlighting the overall health of U.S. consumer credit. The average VantageScore 4.0 credit score held steady at 702 in April, having now increased 1.5 points in two months, due to the trend of decreasing delinquencies and improved balance-to-loan ratios. A VantageScore credit score of 702 was last recorded in the spring of 2021. The lowest VantageScore 4.0 credit score is 300, while the highest score is 850. In addition, for the first time in nearly a year, loan originations rose across all loan products (Credit Card, Personal Loan, Auto Loan and Mortgage) compared to March 2024.
Overall, consumer credit health is improving based on CreditGauge’s monthly report,” said Susan Fahy, Executive Vice President and Chief Digital Officer at VantageScore. “While persistent high prices and interest rates are unquestionably putting pressure on lower income Americans, this month’s data also shows that consumer finances – more broadly – remain strong, reflected in higher VantageScore credit scores, declining delinquencies, stable balances and an overall lower use of credit.
Key insights for April 2024 CreditGauge data include:
ORIGINATIONS ROSE ACROSS PRODUCTS**, LED BY CREDIT CARDS AND PERSONAL LOANS –** New accounts in Credit Cards and Personal Loans saw a significant increase in April,following three months of decline. Credit Cards rose 0.24% to 3.2% and Personal Loans rose 0.41% to 2.50%, outpacing other products. Auto Loan originations climbed for a third straight month, signaling a possible shift toward easier borrower qualifications for car loans amid a tough consumer credit landscape. New mortgages rose by 0.03% compared to the previous month as the spring buying season began.
OVERALL UTILIZATION RATE FELL FOR FOURTH STRAIGHT MONTH WHILE BALANCES DIPPED – The overall credit utilization rate fell for the fourth consecutive month, dropping to 51.7%, the lowest level in three years. Account balances remained high but dipped modestly compared to March 2024. The steady balances, coupled with the decline in utilization rate, were likely a result of banks and lenders increasing Credit Card limits over the past 12 months and decreasing balance-to-loan ratios on Personal Loans and Auto Loans.
APRIL MARKED SECOND STRAIGHT MONTH OF FALLING DELINQUENCIES – In April, delinquencies declined compared to March 2024 across all DPD categories, making it the second consecutive month of declines. In the 30-59 DPD category, all products recorded declines compared to March 2024, with the exception of Personal Loans. In the 60-89 DPD and 90-119 DPD categories, all product types experienced minor reductions, with Mortgages showing the most significant drop in the 60-89 DPD category, and Personal Loans the same in the 90-119 DPD category. Year-over-year, across all DPD categories and products, delinquency rates for the month were higher compared to April 2023. Credit card balances remained flat compared to March 2024 as consumers exercised restraint on continuing to add to their debt levels.
To view the full CreditGauge report, visit the VantageScore website.
About VantageScore CreditGauge™
CreditGauge is provided both as a monthly report to industry stakeholders as well as through a series of interactive tools at VantageScore. Stakeholders can use the tools to execute additional queries on credit metrics and compare current levels to a pre-pandemic timeframe, starting with January 2020. CreditGauge represents the views and opinions of VantageScore and does not necessarily reflect or represent the views of the Nationwide Consumer Reporting Agencies (NCRAs)– Equifax, Experian, and TransUnion.
VantageScore CreditGauge content, including any estimated economic forecasts, is intended for informational purposes only. VantageScore is not responsible for the use of the information contained in the CreditGauge report, including any assumptions or conclusions drawn from its use.
VantageScore CreditGauge is part of a suite of digital tools available on VantageScore.com, which also includes Inclusion360®, RiskRatio™, and MarketGain™.
About VantageScore®
VantageScore is the fastest growing credit scoring company in the U.S., developing the industry’s most innovative, predictive, and inclusive credit score models. In 2023, usage of VantageScore increased by 42% to more than 27 billion credit scores. More than 3,400 institutions, including eight of the top 10 banks, use VantageScore credit scores to provide consumer credit products like credit cards, auto loans, personal loans and mortgages. By developing a credit scoring model that scores 33 million more people than traditional models, VantageScore delivers on its commitment to financial inclusion. With the FHFA mandating the use of VantageScore 4.0 for mortgages, the company is also ushering in a new era for mortgage lending and helping to close the racial homeownership gap.
VantageScore is an independently managed joint venture company of the three Nationwide Consumer Reporting Agencies (NCRAs)– Equifax, Experian, and TransUnion.
