More consumers are scoring 800 or above on their FICO credit scores—19.9 percent today vs. 19.6 percent just six months earlier. Nearly one in five has joined the elite FICO 800 club!

At the same time, fewer are scoring below 550. In fact, there’s been a clear pattern of decline in this segment since the low point of the economy in late 2009/early 2010, reports Fair Isaac Corporation.

Some of this trend may be a result of the lowest-scoring consumers “dropping out” from traditional credit usage, and by extension no longer having valid FICO Scores. Still, this decline is encouraging. It indicates that overall more consumers using credit are managing it responsibly enough to not be among the lowest scorers.

In addition, the national average FICO score is currently at an all-time high since Fair Isaac has been tracking this metric, dating back to pre-recessionary 2005. That said, the improvement in this average seems to be slowing, stabilizing around 695 after a steady climb between October 2013 and October 2014.

FICO Scores Raise or Lower Rates by 240 Basis Points

FICO scores are one of the three most important metrics lenders use to evaluate a prospective borrower and they also determine rates.  Fair Isaac’s calculator shows that rates between the highest and lowest acceptable FICO scores can vary more than 2.4 percent.

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http://www.realestateeconomywatch.com/2015/08/