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Poor credit may keep some borrowers from getting the lowest interest rates.
For many families looking forward to a relocation, getting a mortgage on a new home is a critical step along the way. But a declining credit score may mean that many Americans won't qualify for the best rates, while others may have trouble getting a loan at all.
During the third quarter of the year, the average credit score across the country dropped by two points to 666, reports CreditKarma.com. That score also represents a drop of three points since January, and also comes at a time when data suggests that most Americans have been working on paying off their debt.
"Unfortunately, credit scores continue to decline, however, the data suggests consumers remain focused on reducing their debt," said Ken Lin, CEO of CreditKarma.com. "If consumers continue to proactively manage their credit, we expect this trend will reverse and credit scores will start to go up."
According to the report, the average consumer had more than $174,000 in mortgage loans, more than $7,500 in credit card debt and $15,000 in car loans.
A lower credit score can translate into much higher mortgage costs for moving families. Bankrate.com reports that borrowers with credit scores in the mid 600s - roughly the national average - may pay higher interest rates than those with better scores.