 TITLE: COVID-19 Impact: Changes to Consumer Debt and Credit CONTENT: Average Total Debt Is Down; Credit Scores Are Up\n------------------------------------------------\nDespite unemployment rapidly growing to record levels throughout the U.S., the average amount of individual debt has consistently declined since the onset of the pandemic. Average credit scores are increasing at a higher rate than during this same period last year, and credit utilization—how much available revolving credit a consumer is using—is at a record low for the past five months, according to Experian data.\nFrom January 2020 to May 2020:\n*   The average VantageScore increased by five points.\n*   Average total debt balance shrank by 1%.\n*   Average credit card balances decreased by 14%.\n*   Consumer credit utilization decreased by 5 percentage points (from 30% to 25%).\n*   The average number of 30-day delinquencies per consumer decreased 5% (from 0.4 to 0.38).\nSource: Experian and VantageScore data from January 2020 to May 2020\nThese trends show that, broadly, consumers across the U.S. have made some fairly drastic changes to their financial habits over the span of just a few months. Since the beginning of the pandemic, consumers appear to be either paying down their debt or at least not adding to their overall balances. And possibly spurred by the lowered reliance on revolving credit, the average VantageScore increased by double the rate it did during the same period in 2019.\nThe only debt category to see an increase was average personal loan balance, which has grown 2% since the year began. Breaking this down, most of the growth (+1.8%) occurred between the beginning of March and the end of May, which indicates that this increase could be a result of some heightened borrowing following the onset of the pandemic.\nSource: Experian and VantageScore data  \nAverage Increase in VantageScore by State\n-----------------------------------------\nThough the average credit score in the U.S. can—and often does—fluctuate throughout the year, consumers' average VantageScore has changed much more rapidly in the past five months than during the same time period in 2019.\nSince January 2020, the average VantageScore increased by five points—growing from 681 in January to 686 in May, according to Experian data. This 1% increase is more than triple the 0.3% growth seen during the same months the prior year.\nSource: Experian and VantageScore data, January 2020 to May 2020  \nAmericans See Momentary Debt Decreases, Credit Score Increases\n--------------------------------------------------------------\nDespite the abrupt changes to employment, income and commerce since the onset of the COVID-19 crisis, consumer credit files are not yet showing signs of distress. While it's not to say that consumers' finances are withstanding the current economic pressures unscathed, when averaged across the larger population, Experian data shows clear signs of decreasing debt and growing credit scores.\nOver the coming months, we'll continue to gauge consumer finances as the country continues to react to the ongoing health and financial crisis. Spending may also change as local economies begin to reopen, and debt levels could fluctuate as economic relief options run out.  \n**Methodology:** The analysis results provided are based on an Experian-created statistically relevant aggregate sampling of our consumer credit database that may include use of the FICO® Score 8 version. Different sampling parameters may generate different findings compared with other similar analysis. Analyzed credit data did not contain personal identification information. Metro areas group counties and cities into specific geographic areas for population censuses and compilations of related statistical data.\nFICO® is a registered trademark of Fair Isaac Corporation in the U.S. and other countries. END