ICFE eNEWS #11-12 - March 2nd 2011


Take the Interactive Web Quiz Containing Essential Credit Score Information

Washington, DC - The Consumer Federation of America (CFA), a nonprofit association of nearly 300 consumer groups that was founded in 1968 to advance the consumer interest through research, advocacy, and education and VantageScore Solutions have released survey findings revealing that most consumers are not aware of recent changes in the credit score marketplace.

On 22 questions administered by Opinion Research Corp. to over 1000 representative Americans late last month, on average consumers answered 60 percent correctly, but most did not know who makes credit scores available, what is a strong score, and what's the financial cost of a poor score.

There are a growing number of both generic and lender-specific credit scores, few of which are identical. Even generic scores may vary widely depending on both the credit report and scoring system used. For instance, scores based on credit reports from one of the three main credit bureaus -- Experian, Equifax, and TransUnion -- may utilize either of the two main scoring systems -- FICO with its range of scores from 300 to 850, or VantageScore with its range from 501 to 990.

A 700 score may be either a good score or only a fair score depending on the scoring system." Generic scores available usually reveal this relationship. Those generic scores using the VantageScore scoring system provide a letter grade along with a numeric score. Most scores currently used by mortgage lenders and made available to borrowers use the FICO scoring system.

Government rules going into effect this July will require greater disclosure of credit scores. "The new score disclosures will be most beneficial to those who understand the new credit score marketplace," said Barrett Burns, President and CEO of VantageScore Solutions. "That's why we are joining with CFA over the next year to inform financial educators and individual consumers about how to best participate in this marketplace."

New Interactive Web Quiz Provides the Latest Information Consumers Need to Know

CreditScoreQuiz.org is a unique tool, that with widespread use, will increase consumer knowledge about a dynamic credit score marketplace.

How Consumers Scored and Who Scored Highest:

The survey was administered, using questions developed by CFA and VantageScore, to a representative sample of more than 1000 adult Americans January 28-31 this year. The margin of error is plus or minus three percentage points.

On the 22-question quiz, on average, consumers answered 60 percent correctly. Those aged 34-45 (67% correct) and those with at least $100,000 annual incomes (66% correct) scored highest. Those at least 65 years of age (53% correct) and those with incomes belong $25,000 (58% correct) scored lowest.

A key factor explaining score differences is whether one has obtained one's credit scores. Consumers who had obtained their scores scored higher (64% correct) than those who never had (54% correct).

What Most Consumers Don't Know About Credit Scores: What Many Consumers (50-75%) Know About Credit Scores: What a Large Majority (over 80%) Know About Credit Scores: The Most Important Things Consumers Should Know About Credit Scores:
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Sent by:

Paul Richard
President - Executive Director
Institute of Consumer Financial Education (ICFE)

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