Delinquencies Rise Across All Credit Tiers, Study Finds

According to the latest installment of VantageScore’s Credit Gauge, delinquencies rose in February 2024 across all credit tiers and products (auto loans, credit cards, mortgages, and personal loans). Early-stage delinquencies saw a 0.24 percent increase year-over-year while month-to-month delinquencies rose 0.06 percent, from 0.98 percent in January 2024 to 1.04 percent in February.

“The tale of two consumers is becoming more pronounced,” said Susan Fahy, Executive Vice President and Chief Digital Officer at VantageScore in a press release accompanying the report’s release. “This trend could complicate the Federal Reserve’s efforts to effectively engineer a smooth landing because VantageScore Superprime consumers are still spending and borrowing while VantageScore Subprime consumers are finding it increasingly difficult to stay current on credit payments.”

The report also found that the number of consumers in VantageScore’s Prime credit tier (661-780) decreased for the second consecutive month, marking a 1.1 percent contraction year over year.

Balances decreased by $417 in February compared to January, but year-over-year saw an increase of $1,526. Credit utilization rates also declined for the second consecutive month, reaching the lowest level in nearly three years at 52.2 percent.

VantageScore’s CreditGauge is provided monthly, giving stakeholders tools to execute additional queries on credit metrics and compare current levels to a pre-pandemic timeframe. VantageScore is used by eight of the top ten banks in the United States and more than 3,000 fintechs and consumer websites.