Data Shows Fewer Consumers with Subprime Credit Scores
According to some new research from Equifax, the total number of consumers with subprime credit scores is declining.
The latest data from the third quarter of 2012 shows there are about one million fewer consumers with a credit score below 620. This is a decrease of 2.1 percent versus year-ago figures.
Subprime consumers still make up more than one-quarter of the total scores in the Equifax database. However, the share of consumers with subprime scores dropped 0.7 percent from 25.9 percent to 25.2 percent.
The data also showed that 24 of the 25 top metropolitan areas had a drop in the number of customers with subprime scores. Houston is the only Top 25 market where there was an increase in the number of consumers with a score below 620.
“The job market is improving and time is starting to heal the wounds of the Great Recession,” said Trey Loughran, president of the Personal Solutions division at Equifax. “We are seeing a trend of consumers being careful and disciplined about their use of existing credit while also being cautious about using new accounts they have opened.”