Average Credit Score

Your financial history determines your credit score, that's to say, if you have been late in making your payments after having borrowed money, your average credit report score is bound to be low. There are three credit bureaus (Equifax, TransUnion and Experian) and they have their own interpretation of credit score. The scoring system in each is slightly different from the others and a person may have different scores for all the three bureaus. The Fair Isaac's FICO scoring system is considered the gold standard in credit scoring and this is the score people generally refer to when they mention credit score.

Obtaining an exact value as the average American's credit score can be slightly misleading, due to the various foreclosures and bankruptcies that can bring down the value. The number that will give us a better idea of the credit score average for Americans is the median credit score. This value is the exact middle value, meaning 50% of people have a lower score, 50% have a higher score. Now, the FICO median credit score is 723.

Average Credit Score by State

Here, we have broken down the average FICO credit score for each state for the year 2012. FICO scale scores run on a 330 to 830 scale and are subject to change each year.

State	Average Credit Score
Alabama	718
Alaska	746
Arizona	717
Arkansas	741
California	720
Colorado	732
Connecticut	727
Delaware	728
District Columbia	703
Florida	716
Georgia	731
Hawaii	726
Idaho	741
Illinois	727
Indiana	742
Iowa	735
Kansas	732
Kentucky	719
Louisiana	733
Maine	735
Maryland	737
Massachusetts	717
Michigan	688
Minnesota	736
Mississippi	719
Missouri	738
Montana	716
Nebraska	750
Nevada	724
New Hampshire	727
New Jersey	717
New Mexico	707
New York	720
North Carolina	727
North Dakota	735
Ohio	720
Oklahoma	742
Oregon	735
Pennsylvania	732
Rhode Island	706
South Carolina	725
South Dakota	744
Tennessee	720
Texas	716
Utah	721
Vermont	721
Virginia	717
Washington	729
West Virginia	719
Wisconsin	730
Wyoming	723

Improving Credit Score after Bankruptcy

Sometimes, when faced with insurmountable debt, bankruptcy is the only option. Though filing for bankruptcy will provide respite from surmounting bills and losses, A bankruptcy will remain on your credit report for a decade after you file for it. Repaying your bills is a big part of your credit score and bankruptcy shows there were some bills you never repaid. A direct consequence is that your credit record takes a beating. Thus restricting your ability to obtain credit at a good interest rate. One positive to emerge from the filing for bankruptcy is that as your debt load is reduced, which lands you in a better position to pay off your remaining debts and save money for further emergencies.

Many of you, who have been through bankruptcy, may find companies charging a price in exchange of erasing the bankruptcy from your credit report. I would suggest that you treat such offers with great caution because nothing can take off the bankruptcy from a credit report, as long as the bankruptcy information is accurate.

A perfect credit score is 850, which is most desired, but with a score of 720, you can still get a loan with lower rate of interest. If your score is below, that's when the interest rate begins to rise. The best way you can improve your ratings is by making monthly payments on time and having as less debt as possible. Moreover, make sure that you don't apply for too many credit cards so that you can resist the temptation of borrowing money and thereby hampering your chances to rebuild credit score.

The credit scores mentioned above are subject to change every year depending on the financial condition of the people of that state. A general rule of thumb is to not to worry about it. Remember, the higher your score, the more money you will eventually save. Having an above-average score is a vital factor in determining how much you can borrow and what you will pay for loans. Don't rely on just maintaining a credit record that hovers around the good score mark, because it will get increasingly hard to get your credit score back on track the longer you live with bad credit.