Credit reports a mystery to many Americans

04.22.09
By Sarah Beldo

Do you know what to expect when you order a copy of your credit report? Are you aware of how different financial behaviors can affect your credit score?

According to a new survey, many U.S. consumers continue to possess uncertainty about various financial products and reports.

The TrueCredit.com Financial Literacy Quiz found that 90 percent of people polled believe that if they order their credit report, they will automatically be able to see their credit score.

Although it may seem like a reasonable assumption, your FICO score is actually a separate three-digit number that is generated from your credit reports and is not included unless you specifically order it.

Meanwhile, the quiz also found that slightly more than half of Americans are not sure which factors are analyzed to determine a credit score.

In the current economic climate, with lenders assessing the creditworthiness of potential borrowers with an increasingly cautious eye, the importance of understanding financial products and information cannot be overstated.

Consumers who increase their financial literacy may feel more empowered and be able to reap the benefits of their knowledge. For example, improving your credit score from the "pretty good" to "very good" range before applying for a mortgage can potentially save you thousands of dollars over the term of the home loan.

Meanwhile, experts say the standard for what is considered to be a good credit score has risen from the low 700s to the mid-to-upper 700s, suggesting there has never been a better time to take a good, hard look at where you stand and where you could make improvements.

"The rules have definitely changed," consumer advocate John Ulzheimer told the Allentown Morning Call.

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90 percent of people polled believe that if they order their credit report, they will automatically be able to see their credit score.