U.
S. consumer credit conditions showed signs of softening by the end of 2025, according to the latest edition of CreditGauge™ from VantageScore. The report highlighted rising delinquency pressures across various credit products and a modest decline in the average consumer credit score.
Overall credit delinquencies increased across all late payment stages. Notably, late-stage mortgage delinquencies saw a sharp rise year-over-year and consistently increased across mid-stage and riskier credit tiers, indicating affordability-driven strain among borrowers.
The average VantageScore 4.0 credit score declined by one point in December 2025, settling at 700. This score represents a return to levels last observed in early 2023. Susan Fahy, EVP and Chief Digital, Data and Technology Officer at VantageScore, commented on the findings: “Consumers in the 2025 holiday season showed some softening in credit health, with the average VantageScore 4.0 credit score falling to 700, an average last seen in early 2023. Higher mortgage and auto loan delinquencies reflect the effects of elevated interest rates and prices in today’s housing and auto markets.”
The December 2025 data showed a one-point month-over-month decline and a two-point year-over-year decline in the average credit score. While reflecting a modest softening in consumer credit profiles, VantageScore noted that this did not indicate broad-based consumer stress.
Further analysis of borrower segments from December 2023 to December 2025 revealed a shift. The share of consumers in the VantageScore Subprime credit tier increased from 18.5% to 19.0%, and the VantageScore Nearprime segment edged up from 17.6% to 17.9%. Concurrently, the VantageScore Prime tier decreased by 1.1%, indicating a gradual migration of consumers to lower credit tiers due to ongoing affordability constraints.
In December 2025, overall delinquency rates also registered increases on both a month-over-month and year-over-year basis across all categories. Late-stage delinquencies experienced the most significant month-over-month and year-over-year increases, rising to 0.27% from 0.24% and 0.19%, respectively. Early- and mid-stage delinquencies also showed an upward trend. These patterns suggest emerging repayment strain among a subset of borrowers at year-end, driven by persistently elevated borrowing costs.
VantageScore, an independent joint venture company owned by Equifax, Experian, and TransUnion, is known for its credit scoring models. In 2024, usage of VantageScore increased by 55%, reaching 42 billion credit scores. More than 3,700 institutions, including nine of the top 10 U.
S. banks, utilize VantageScore credit scores and digital tools to provide consumer credit products or generate insights into consumer behavior. The VantageScore 4.0 credit scoring model is capable of scoring 33 million more people than traditional models. The company is also impacting mortgage lending, with the FHFA allowing immediate use of VantageScore 4.0 for Fannie Mae and Freddie Mac guaranteed mortgages.
