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Uncertainty about credit scores

By Lucy Lazarony ·
Tuesday, March 1, 2011
Posted: 2 pm ET

What is a strong credit score and what is the financial cost of a poor credit score?

Most American consumers couldn't answer those questions in a new national survey from the Consumer Federation of America.

More than 1,000 Americans participated in the survey, which was administered by Opinion Research Corp. in late January.

On the 22-question quiz, on average, consumers answered just 60 percent of questions correctly. When it comes to credit scores, there is a lot that Americans don't understand.

According to the survey, most Americans don't know:

  • A credit score mainly represents the risk of not repaying a loan.
  • Age and marital status are not factors used in calculating credit scores.
  • On a $20,000, 60-month auto loan, borrowers would usually pay $5,000 more in interest with a bad credit score than with a good credit score.
  • Generic credit scores are now available from numerous Web-based sources, not just from FICO or the three main credit-reporting agencies Experian, Equifax and TransUnion.
  • A strong credit score depends on the scale used -- over 700 for the FICO scoring model and over 800 for the VantageScore scoring model.

"Today, the most important fact about your credit score is not its level but its relation to other scores from that source," says Stephen Brobeck, executive director at the Consumer Federation of America. "For example, a 700 score may be either a good score or only a fair score depending on the scoring system."

Want to test your credit scoring knowledge?  A new interactive quiz,, is available from the Consumer Federation of America and VantageScore.

Your credit score can mean the difference between paying a low or high interest rate on everything from credit cards to car loans to mortgages. For help in understanding credit scoring, check out this guide from

Curious about your credit score? offers a free FICO score estimator.

Looking for ways to improve your credit score? These tips can help.

Are you on the lookout for a new credit card? Let your credit score be your guide.

When shopping for a credit card, it's a good idea to stick to cards that are suitable for your level of credit.

Apply for credit cards beyond your credit reach and you risk needless dings to your credit score.

Once you have an estimate of your credit score, be sure to shop for cards that match your level of credit. makes this easy to do by allowing you to search for cards based on four credit categories: excellent, good, average and bad credit.

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