Late-State Credit Delinquencies On The Rise

VantageScore’s CreditGauge Report finds that consumers are showing increased signs of credit stress.

Late-stage delinquencies increased across all credit tiers, according to the latest CreditGaugereport released by VantageScore.

Credit delinquencies over 90 days late were up 109% year-over-year in the VantageScore Superprime segment, while Prime saw a 47% increase year-over-year. The average VantageScore 4.0 credit score dropped by one point to 701, reflecting the decrease in creditworthiness for the average consumer.

“Consumers in the highest VantageScore credit tiers are showing increased signs of credit stress on a year-over-year basis,” said Susan Fahy, executive vice president and chief digital officer at VantageScore. “We’re also seeing a marked divergence in secured versus unsecured lending. Balances are increasing for auto loans and mortgages, while new credit originations are down. Sustained inflation for car and house prices is driving higher balances in these credit categories.”

More insights from the report:

Average VantageScore 4.0 Drops

“In July 2025, the average Vantage Score 4.0 credit score dropped to 701, which is a one-point drop. That tells us a big story,” said Atif Mirza, senior vice president, digital, at VantageScore. “What we’re seeing is the shift in population distribution. More consumers are moving into Subprime, which shows us the repayment challenges in that sector. The Prime segment in the past two years [shrank] about 1.4%, and again, more consumers we see moving into Subprime is a big factor.”

VantageScore’s Subprime tier grew by 0.6 points from 18.1% to 18.7% between July 2023 and July 2025, swelling the ranks of consumers more likely to face repayment challenges. Conversely, the VantageScore Prime tier shrunk by 1.4% over the same period.

Mortgage, Auto Loan Delinquencies and Balances Increase

Mortgage and auto loan credit delinquencies saw the largest year-over-year uptick in the early-stage category (30-59 DPD), up 0.11 and 0.05 points, respectively. Auto loan and mortgage balances also increased on a month-over-month basis, while originations decreased for auto loans and held steady for mortgages.

“Across all products, mortgage and auto loans saw the largest increase in early-stage delinquencies when compared to the same period last year,” Fahy said.

Secured Originations Soften

Auto loan originations fell to 1.42% in July 2025 after peaking at 1.76% in April, according to the report. Mortgage originations were relatively flat from June to July 2025 but stood 0.04% higher than in July 2024.

“These softening trends in originations are likely due to a combination of reduced demand and tighter lending standards,” the report noted.

https://www.acainternational.org/news/late-state-credit-delinquencies-on-the-rise-2/