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TransUnion Reveals U.S. Metro Areas With Best / Worst Credit Grades

Minneapolis-St. Paul, San Jose Rank Best

CHICAGO, IL--(Marketwire - October 20, 2010) - Just as students around the country are receiving their first academic grades of the school year, TransUnion has revealed a ranking of metropolitan areas with the best and worst credit grades in the country. The metropolitan areas at the very top of the class are Minneapolis-St. Paul, MN and Bloomington, WI. The Memphis, TN (MS-AR) metropolitan area ranked lowest. 

Markets with the Greatest Percentages of 'A's  
Minneapolis-St. Paul-Bloomington, MN-WI 23.5%
San Jose-Sunnyvale-Santa Clara, CA 23.5%
San Francisco-Oakland-Fremont, CA 22.9%
Washington-Arlington-Alexandria, DC-VA 22.4%
Seattle-Tacoma-Bellevue, WA 21.6%
   
Markets with the Greatest Percentages of 'F's  
Memphis, TN-MS-AR 27.3%
Las Vegas-Paradise, NV 26.2%
Riverside-San Bernardino-Ontario, CA 25.2%
Orlando-Kissimmee, FL 23.2%
Miami-Fort Lauderdale-Pompano Beach, FL 22.8%
 
Grades as Percentage of U.S. Population
(A) = 10.9%, (B) = 26.9%, (C) = 20.5%, (D) = 22.3%, (F) = 19.4%

"Because lenders have so many scoring models at their disposal, it's rare when the credit score they receive for a consumer and the score the consumer obtains for himself actually match, and that causes a lot of confusion," said Heather Battison, director of education for TransUnion consumer products. "That's why the A-F, academic-style letter grade that comes with every VantageScore consumers obtain at TransUnion.com is so beneficial. If my grade is an 'A,' I innately understand that means a lender is likely to view my creditworthiness in a very positive light; and that's primarily what I want to know."

The ranking is the first of its kind from TransUnion, which determined the five Metropolitan Statistical Areas (MSAs) with the largest percentage of 'A's, and 'F's, based upon the A-F grade range associated with the VantageScore credit scoring model. VantageScore is a highly predictive and consistent consumer credit scoring model and first developed together by all three major credit reporting companies. Consumer scores fall within a range of 501 to 990, with higher scores representing a lower likelihood of risk. At TransUnion.com, each score delivered is accompanied by a letter grade. (901+=A, 900-801=B, 800-701=C, 700-601=D, and 600-501=F). Among others, VantageScore is currently utilized by 4 of the top 5 financial institutions and 5 of the top 5 credit card issuers.

Whether your credit receives high grades or could use some work, TransUnion provides the following tips to keeping your credit healthy:

  • Study your situation. Proactively manage your credit and risk for identity theft with an ongoing credit monitoring product. This will help you understand your financial situation; then create a plan to position yourself better in the eyes of the lender. 

  • Don't be tardy with your payments. A history of late payments -- even by a few days -- can potentially harm your credit score.

  • Manage your debts. Keeping high balances relative to credit limits on key credit accounts can likely have a negative impact on a score, so concentrate on paying down debt. As a rule of thumb, keep these balances at or below 30 percent of your total available credit to present the best possible financial image to lenders. Set budget goals and use only cash if you can't seem to master your credit card habit.

  • Give yourself time. Long-term credit relationships and a diverse mix of credit accounts may help you achieve a higher credit score. Avoid closing credit cards and other accounts that have been paid on time over a long period, as it can make your credit history appear shorter and could affect your score.

  • Limit inquiries. Each time you apply for a new credit card, you should expect that an inquiry will appear on your credit report. Frequent credit card inquiries can make it look like you have a cash flow problem and may lower your credit score. However, when you shop for mortgage or auto loan rates over a two to three week period, credit scoring models typically factor the resulting inquiries together as a single item. This enables you to shop for favorable loan rates with minimal impact to your credit score.

Methodology
Using TransUnion anonymized credit data, the VantageScore of credit active consumers in the top 50 Metropolitan Statistical Areas (MSAs) for Q2 was analyzed to determine the percentage of consumers within each of the VantageScore score/grade ranges. TransUnion reported the five MSAs that had the largest percentage of 'A's and the five which had the largest percentage of 'F's.

About TransUnion
TransUnion Interactive, Inc. is a consumer subsidiary of TransUnion. As a global leader in credit and information management, TransUnion creates advantages for millions of people around the world by gathering, analyzing and delivering information. For businesses, TransUnion helps improve efficiency, manage risk, reduce costs and increase revenue by delivering comprehensive data and advanced analytics and decisioning. For consumers, TransUnion provides the tools, resources and education to help manage their credit health and achieve their financial goals. Through these and other efforts, TransUnion is working to build stronger economies worldwide. Founded in 1968 and headquartered in Chicago, TransUnion employs associates in more than 25 countries on five continents. www.transunion.com

For More Information:
John Branham
312.985.3299
Email Contact

Media Contacts

Consumer, Corporate and International

Clifton O'Neal
coneal@transunion.com

Credit Statistics, B2B and International

Dave Blumberg
 

 
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