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According to FICO, the data company that tracks credit scores, the national average for the country is now 704, a new record high. Considered to be good news for home buyers, sellers, lenders and the economy, credit scores predict the probability of a loan default. They run from 300 to 850 with 704 considered "good." A score of 750 promises you better rates and terms. In 2009, the average score was 686 but the numbers have been going up ever since, The 5-point increase from 699 in 2016 to 704 this year is one of the largest two-year improvements on record.

Mortgage borrowers’ scores are dropping. Although FICO scores for most categories of consumers are up, average scores for people taking out home mortgages are sliding in the opposite direction. In 2009 and 2013, borrowers had an average score of 745; it’s down to around 733. This might seem odd, but FICO says it shows that lenders are relaxing their approval standards slightly to include a broader range of borrowers — people with thin files, dings in their credit histories and higher debt-to-income ratios. Think millennial first-time buyers and people who hit a rough patch during the Great Recession.

What to make of the latest FICO numbers? Lessons learned from the housing bust and the recession clearly are affecting consumers’ scores and behavior. Dornhelm thinks that more Americans have access to — and better understand — their credit scores than in previous years, and they’re avoiding doing things that can depress their scores, such as maxing out on credit cards.If you’re smart, you’ve been doing the same.

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