Credit scores can vary quite a bit from state to state. This point was underlined earlier this year when Experian released its 9th annual state of credit report. By analyzing the credit performance of consumers across America, we learned that credit heroes are needed more now than ever.
Can you guess what the average credit score in the U.S. is?
According to the study, the answer is 675. That means the average American has what’s considered a ‘prime’ credit score. However, roughly 40% of the states in the U.S. fall below this average.
Let’s do an exercise. Think of people in your community and state; whether your friends, family, or a neighbor. If you were to guess, how do you think their credit scores compare to the national average?
If you think your network lies below the average score of 675, did you know that you can extend a helping hand? By starting a credit repair business, you’re able to help people in your community to overcome financial obstacles, while still growing your bottom line.
What Does It Mean to Have Below Average Credit Score?
Experian’s credit scores range from 300 to 850 and fall into the following categories:
- 781 - 850: Super prime
- 661 - 780: Prime
- 601 - 660: Near Prime
- 500 - 600: Subprime
- 300 - 499: Deep subprime
Once someone’s credit score falls below prime, and into near prime, subprime or deep subprime, life gets more expensive. Individuals can expect to:
- Pay more in fees on credit cards
- Pay higher interest rates on loans (which increases the monthly payment)
- Have increased difficulty obtaining loans
- Pay more for necessary costs like turning on utilities
For Americans with deep subprime credit, it may be impossible to obtain financing at all, making goals like purchasing a vehicle or owning a home a dream deferred. According to Experian, 21.2% of Americans fall into the deep subprime credit score.
By starting a credit repair business, you’re not just making adjustments to a meaningless number; you’re making life more affordable (and comfortable) for your state.
Curious what the Average credit score in your state is? Check out this map above to see Experian’s results. (Image/CNBC)
States With the Lowest Experian Credit Scores
Though credit heroes can make a difference in every state, there are a handful of locations within the United States that need credit repair businesses more than others. The states with five lowest average scores are at or below 659, which is considered near prime by Experian’s scoring. These states are:
- Texas average credit score: 659
- Georgia average credit score: 659
- Nevada average credit score: 659
- Louisiana average credit score: 653
- Mississippi average credit score: 652
That means the average person in these five states may be paying more for credit than the average American. If that doesn’t bode well with you, then it’s time to find your inner credit hero, and take action for your people.
How Credit Heroes Can Make a Difference
By starting a credit repair business, you can help lift the burden of fallen credit off of your community.
Did you know that 79% of credit reports have errors on them? Credit repair specialists work to uncover errors or other anomalies that could be harming your clients’ financial situations. And once discovered, you can send dispute letters — the kryptonite of credit bureaus — to give financial power back to your clients.
Additionally, credit repair businesses can also serve as a coach. When you make sure your clients are adopting responsible credit habits that will stick for the long-term, they can increase their credit scores once and for all.
Here’s a real-life example of how you can be a credit hero in your state:
- Experian noted that residents in Arkansas and Mississippi have the highest average credit utilization rates in the country at 36% and 35%, respectively
- As a credit repair specialist, you can advise your clients located in these states that it’s best practice to keep their utilization rate below 30%. (That’s because the higher the ratio, the more difficult it can become to make monthly payments. And, with missed payments equals reductions on your credit score.)
Helping your clients with their credit utilization rate is just one small way you can impact the financial health for individuals in your community.
Regardless of which state you reside in, if you’re dedicated to helping people in need, you can have a major impact, maybe even boosting the average credit score in your state! Are you ready to get started?