States With the Best Credit Scores

The Top Best States for Credit Scores
Having a high credit score is extremely important in today’s financial world and is used by dozens of industries to determine whether you’re a risk to them or not. Credit scores are checked for hiring, renting, buying, and dating.

We all understand how important credit scores are, and while where you live isn’t necessarily going to affect your credit score, we’ve decided to put together a list of the top states with the best and worst credit scores below.

While it’s unlikely that any location will directly impact your credit score, you may want to consider that in some cities, the average household is more financially stable than others. If we look at the city with the highest average credit score, for instance, Minneapolis-St. Paul has an average median income of almost $70,000 per year, whereas a city like Shreveport, with a much lower average credit score, has a median income of only $42,157. So, it’s possible that the higher income directly affected the credit scores as card holders were more financially stable. 

A good credit score is a sign of healthy money management — it’s also necessary if you want to afford many of life’s necessities. For example, if you buy a home this spring, a higher credit score will get you a lower mortgage, saving you money. The same is true for car loans; a higher credit score can get you a lower APR on your auto loan.

While a credit score can determine which financial products you have access to, the score itself can be heavily influenced by where you live, finds a new study from CreditRepairEnforcers.com. Using Experian data on local credit scores, CreditRepairEnforcers.com calculated the average credit score by the state to find the 10 states where people have the best credit scores — and the 10 with the worst credit.

10 States With the Best Credit Scores
What is a good credit score? Credit score ranges are typically between 300 and 850, and the 10 states with the best credit scores all have 690 or above, comfortably in the excellent credit range. With good credit scores in this range, residents of these states will find it easier to qualify for loans and get lower interest rates and other favorable terms.

Living in the Midwest makes you more likely to have a higher credit score. Six of the 10 states with the highest average credit scores are in the Midwest. The states with higher credit scores also tend to have lower rates of debt delinquency (debts that are past due or possibly in collections).

1. Montana - 688.4: The average credit score in Montana is still high enough to qualify as good credit, making it easier for residents to get loans and keep borrowing affordable. Fewer Montanans, just 30.3 percent, have debts that are past due or in collections, about 8 percent less than the national average of 38.5 percent, according to data from the Urban Institute’s 2014 “Delinquent Debt in America” report. Montana also has the lowest number of borrowers that are 60 days or more delinquent on personal loans, according to credit bureau TransUnion’s 2015 report on consumer lending, mortgages, credit cards, and auto loans.
2. Hawaii - 689.7: Hawaii residents also have good credit, even though they borrow on credit cards more than most Americans. According to TransUnion’s data, the average credit card balance nationwide is $5,337. Hawaii cardholders owe $409 more, with average balances at $5,746 in the state in Q4 2015. Despite higher credit card balances, Hawaii residents have the third-highest median income of $71,223 in 2014, according to U.S. Census data, which should help them manage credit responsibly. Just 27.3 percent of Hawaii borrowers have past-due debts and debt in collections compared to the national average of 38.5 percent.
3. Iowa - 690.2: Iowa residents have earned higher credit scores by paying debts on time. According to Urban Institute data, only three in 10 Iowans (30.4 percent) have debts past due or in collections. According to TransUnion data, Iowa residents also have below-average credit card delinquency rates and the lowest average credit card balances in the nation at just $4,386.
4. Nebraska - 690.7: Nebraska residents are less likely than most Americans to have debts past due; just 28.2 percent of the state’s residents have debts past due or in collections. Nebraska also has a mortgage delinquency rate that’s less than the national average (1.26 percent compared to 2.37 percent, respectively) and lower credit card balances and delinquencies.
5. New Jersey - 693: With a higher median household income of $65,243, New Jersey residents might find they have more room in their budgets to keep up with debts and responsibly manage credit. New Jersey has delinquency rates that fall below the national averages on significant debt payments like car loans, personal loans, and credit cards. Still, many New Jersey homeowners have struggled to keep up with mortgage payments, and at 4.7 percent, the state has the highest number of residents 60 days delinquent on mortgages, according to TransUnion data.
6. Vermont - 693.4: Fewer Vermont borrowers have debts past due or in collections, just 28.2 percent, according to numbers from the Urban Institute. With fewer Vermont residents facing delinquent debts, it’s easier for them to keep credit scores healthy and well within the range of a prime credit score.
7. South Dakota - 694.3: The average 694.3 credit score in South Dakota shows that the residents in this state are better at managing credit. An essential part is making payments on time, as many South Dakotans do on their auto loans. The state has a delinquency rate of just 0.95 percent on car loans past 60 days delinquent, according to TransUnion. In comparison, the national rate is 1.24 percent. South Dakota credit cardholders also keep balances low; the average card balance in this state is $600 less than the national average of $5,337.
8. Wisconsin - 695.8: Wisconsin residents borrow less on credit, as shown with low balances that average $4,589, $748 less than the national average. By owing less, Wisconsin cardholders keep credit card debt manageable, which helped the state achieve the lowest credit card delinquency rate at 0.92 percent, according to TransUnion data.
9. North Dakota - 696.5: North Dakota residents are the least likely to miss a mortgage payment, earning the lowest delinquency rate on mortgages at 0.97 percent. North Dakota also has some of the lowest delinquency rates on debts like credit cards, auto loans, and personal loans. Overall, less than a quarter — 24.2 percent — of borrowers in North Dakota have obligations that are past due or in collections, according to Urban Institute data. With more people in this state wisely managing their credit and debts, North Dakota earns the second-highest average credit score at 696.5.
10. Minnesota - 704: Minnesota’s average credit score is most squarely in the “good credit” range, tipping past the 700 mark. All four Minnesota cities for which Experian reported an average credit score had a score of 701 or above, with Mankato, Minn., taking the No. 1 spot with an average score of 706 — not exactly an excellent credit score, but it’s still very, very good. With a median income of $67,244, Minnesotans can afford more debt — yet avoid raising it. According to TransUnion data, Minnesota’s average balances on mortgages, credit cards, and auto loans are well below average. And when they do accrue debt, Minnesota residents responsibly make payments; Minnesota has a low rate of debts that are past due or in collections, with over three in four (76.1 percent) of borrowers in this state avoiding this common credit issue.

These behaviors show residents are more likely to have lower credit utilization ratios and histories of on-time payments, which are major factors that boost credit scores.

You must check your credit score and credit report if you want a perfect credit score or the highest one possible. You can get your free credit report online by visiting AnnualCreditReport.com. Getting a free credit score, however, might be a bit trickier. In most cases, you will likely have to pay a small fee to one of the three credit bureaus — TransUnion, Experian, or Equifax — to receive your credit score.

Methodology: To generate average credit scores by state, CreditRepairEnforcers.com sourced average credit scores for 213 U.S. cities reported by Experian in its 2015 State of Credit report. These credit scores by the city were grouped by state. CreditRepairEnforcers.com then averaged all cities’ credit scores reported in each state, including the District of Columbia but excluding Delaware and New Hampshire, for which no city credit scores were reported. These credit score averages were ordered from highest to lowest to find the states with the best and worst credit scores.
 
Credit score and open credit card data are from Experian. We analyzed 143 of the largest U.S. metropolitan areas.

About CreditRepairEnforcers.com: 
Get the benefits and experience of a firm that concentrates on helping people with credit problems without paying huge setup fees. Credit Repair Enforcers has successfully removed erroneous, unverifiable, outdated, and inaccurate information from our client’s three credit reports for over 20+ years. We assist with all things credit repair and credit building. We have helped people who need assistance with personal, business, and corporate credit repair and credit building. Credit Repair Enforcers fight for your credit rights!