A recent Experian credit trends study showcases the types of debts Americans have, the amounts they owe and the differences between generations. Nationally, the average debt in the United States is $78,030 and the average VantageScore® credit score is 751. The debt and VantageScore® credit score distribution for each group is listed below, with the 30 to 46 age group carrying the most debt and the youngest age group (19 to 29) carrying the least: Age group Average debt Average VantageScore® credit score 66 and older $38,043 829 47 to 65 $101,951 782 30 to 46 $111,121 718 19 to 29 $34,765 672   Get your VantageScore® credit score here Source: To view the complete study, please click here VantageScore® is owned by VantageScore Solutions, LLC

In Q3 2011, $143 billion – or nearly 44 percent of the $327 billion in new mortgage originations – was generated by VantageScore® A tier consumers. This represents an increase of 35 percent for VantageScore A tier consumers when compared with originations for the quarter before ($106 billion, or 39 percent of total originations). Watch Experian's Webinar for a detailed look at the current state of strategic default in mortgage and an update on consumer credit trends from the Q4 2011 Experian-Oliver Wyman Market Intelligence Reports Source: Experian-Oliver Wyman Market Intelligence Reports. VantageScore® is owned by VantageScore Solutions, LLC.

In my last two posts on bankcard and auto originations, I provided evidence as to why lenders have reason to feel optimistic about their growth prospects in 2012.  With real estate lending however, the recovery, or lack thereof looks like it may continue to struggle throughout the year. At first glance, it would appear that the stars have aligned for a real estate turnaround.  Interest rates are at or near all-time lows, housing prices are at post-bubble lows and people are going back to work with the unemployment rate at a 3-year low just above 8%. However, mortgage originations and HELOC limits were at $327B and $20B for Q3 2011, respectively.  Admittedly not all-time quarterly lows, but well off levels of just a couple years ago.  And according to the Mortgage Bankers Association, 65% of the mortgage volume was from refinance activity. So why the lull in real estate originations?  Ironically, the same reasons I just mentioned that should drive a recovery. Low interest rates – That is, for those that qualify.  The most creditworthy, VantageScore® credit score A and B consumers made up nearly 77% of the $327B mortgage volume and 87% of the $20B HELOC volume in Q3 2011.  While continuing to clean up their portfolios, lenders are adjusting their risk exposure accordingly. Housing prices at multi-year lows – According to the S&P Case Shiller index, housing prices were 4% lower at the end of 2011 when compared to the end of 2010 and at the lowest level since the real estate bubble.  Previous to this report, many thought housing prices had stabilized, but the excess inventory of distressed properties continues to drive down prices, keeping potential buyers on the sidelines. Unemployment rate at 3-year low – Sure, 8.3% sounds good now when you consider we were near 10% throughout 2010.  But this is a far cry from the 4-5% rate we experienced just five years ago.   Many consumers continue to struggle, affecting their ability to make good on their debt obligations, including their mortgage (see “Housing prices at multi-year lows” above), in turn affecting their credit status (see “Low interest rates” above)… you get the picture. Ironic or not, the good news is that these forces will be the same ones to drive the turnaround in real estate originations.  Interest rates are projected to remain low for the foreseeable future, foreclosures and distressed inventory will eventually clear out and the unemployment rate is headed in the right direction.  The only missing ingredient to make these variables transform from the hurdle to the growth factor is time.