Credit Karma (www.creditkarma.com), the consumer’s advocate for demystifying credit, today released its U.S. Credit Score Climate Report with trend data for October 2009. Amongst consumers with a credit card, credit card debt increased 14% nationally from September. The Midwest and Northeast regions showed the highest increases in credit card debt with 16% and 17% respectively, and Philadelphia consumers represented the highest gain for a Metropolitan Statistical Area (MSA), increasing debt by 28% in October.
In October, the average consumer with an open account had:
- $7,573 in credit card debt
- $194,372 in home mortgage loans
- $54,039 in home equity
- $14,729 in auto loans
- $26,417 in student loans
“This month’s data shows that consumers are feeling more confident about spending money again ahead of the holidays,” says Ken Lin, CEO of Credit Karma. “However, credit scores remain high in regions with lower increases in credit card spending proving there’s a direct correlation between debt and credit scores.”
In addition, credit scores are on the rise for many consumers with 40% of consumers increasing their credit scores in October. However, despite the high percentage of increasing credit scores, the average credit score is still down one point from September and down five points since the beginning of the year. The current average credit score is 671.
Here are some other key findings:
- The South region had the highest percentage of increasing credit scores. In October, 41% of consumers in the South increased their credit scores, while 28% of consumers’ credit scores decreased and 31% of consumers’ credit scores stayed the same. Despite this high percentage of increasing credit scores, Southern consumers still have the lowest credit score nationwide. The average credit score in the South in October was 661.
- Among states, North Carolina and Louisiana had the highest percentage of increasing credit scores. In both states, 44% of consumers were able to increase their credit scores in October; however both states have average credit scores below the national average. The average credit score in October was 663 for North Carolina and 646 for Louisiana.
- Since the beginning of 2009, consumers in the West have had the highest credit scores nationwide. In October, the average credit score in the West was 682. Additionally, the San Francisco MSA remains the only MSA with an average credit score above 700. On average, San Francisco consumers have a credit score of 707.
Methodology
Each month, the Credit Karma U.S. Consumer Credit Score Climate Report compares the current credit scores of its user base with previous scores pulled at least 30 days prior and no more than 90 days prior to the stated month. This month’s report includes a comparison of more than 79,000 Credit Karma user scores.
About Credit Karma
Credit Karma, the consumer’s advocate for demystifying credit, is the only Web site that provides consumers free access to their credit score, plus a range of tools and information resources to help them monitor and manage the credit aspect of their financial health. Credit Karma’s goal is to help consumers easily digest the contents of their credit report and understand what makes up their credit score. Credit Karma works with a range of partners, including mortgage lenders, credit card providers, banks, and wireless providers. For more information, visit www.creditkarma.com.