WASHINGTON (5/28/13)--The large number of Americans who know little about credit scores also have little incentive to improve or maintain their scores because they don't understand how having a low score can affect them. Lower scores can mean those individuals will pay higher finance costs and have limited access to--and increased costs of--services such as cell phones, electricity and rental housing (Consumer Federation of America May 13).
A recent survey by Consumer Federation of America (CFA), Washington, D.C., and VantageScore Solutions, Stamford, Conn., identified several misperceptions about credit scores. Between one-quarter and two-fifths of 1,022 American adults answered several questions incorrectly:
There was one question that tripped up almost everyone. Only 7% of respondents were aware that making multiple inquiries about getting a consumer or mortgage loan within a two-week window does not lower your credit score. Shopping around for the best rate is in your best interest.
Many job seekers are surprised to learn that potential employers check credit histories. A 2012 survey by the Society for Human Resource Management, Alexandria, Va., revealed that nearly half (47%) of employers use credit checks in hiring decisions (The New York Times May 11).
Things you can do to improve or maintain your credit score include:
For more information, read "New Credit Scoring System Helps Consumers" in the Home & Family Finance Resource Center.