Banking & Credit

6th Annual Credit Score Survey Reveals Large Majority Know Credit Score Basics But Don’t Understand Important Details

Millennials Have Poorer Understanding of Credit Scores than do Gen-Exers; Credit Score Quiz ( Helps Consumers Understand Credit Card Basics and Complexities

Washington, DC – The sixth annual credit score survey, released today by the Consumer Federation of America (CFA) and VantageScore Solutions, LLC, reveals that a large majority of consumers (over 80%) know the basic facts about credit scores:

  • Credit scores are used by mortgage lenders (88%) and credit card issuers (87%).
  • Key factors used to calculate credit scores are missed payments (91%), personal bankruptcy (86%), and high credit card balances (85%).
  • Ethnic origin is not used to calculate these scores (believed by only 12%).
  • 700 is a good credit score (81%).

Yet, the national survey also revealed that many consumers do not understand credit score details with important cost implications:

  • Most seriously, consumers greatly underestimate the cost of low credit scores. Only 22 percent know that a low score, compared to a high score, typically increases the cost of a $20,000, 60-month auto loan by more than $5,000.
  • A significant minority do not know that credit scores are used by non-creditors. Only about half (53%) know that electric utilities may use credit scores (for example, in determining the initial required deposit), while only about two-thirds know that these scores may be used by home insurers (66%), cell phone companies (68%), and landlords (70%).
  • Over two-fifths think that marital status (42%) and age (42%) are used in the calculation of credit scores. While these factors may influence the use of credit, how credit is used determines credit scores.
  • Only about half of consumers (51%) know when lenders are required to inform borrowers of their use of credit scores – after a mortgage application, when a consumer does not receive the best terms on a consumer loan, and whenever a consumer is turned down for a loan.

“The good news is that consumers understand the basics of credit scores, such as the importance of making loan payments on time,” noted Stephen Brobeck, CFA’s Executive Director.  “The bad news is that this knowledge is limited and, each year, can cost them hundreds of dollars in fees on services and additional interest on consumer loans,” he added.

To explain both credit score basics and details, CFA and VantageScore maintain an interactive credit score quiz website ( that allows consumers to test their credit score knowledge by answering 12 questions.  The website provides succinct answers to these questions and additional information sources about credit scores.  It is also available in a Spanish translation.

“While the credit scoring industry is always innovating and changing, practicing good credit behaviors and understanding the basics about your credit score are fundamentally important,” said Barrett Burns, president and CEO of VantageScore Solutions.  “We encourage consumers, educators and anyone counseling others about borrowing money to take our online quiz and become empowered to make the right decisions to reach and maintain excellent creditworthiness.”

The telephone survey, undertaken by ORC International in April (14-17) of this year, interviewed a representative sample of 1005 adult Americans by landline or cellphone.  The margin of error was plus or minus three percentage points.

Millennials Know Less Than Gen-Exers

The national survey also revealed that millennials (18-34 years of age) know less about credit scores than do gen-exers (35-51 years of age).  On eight of nine key knowledge questions, gen-exers scored more highly than millennials.  For example, 89 percent of gen-exers, but only 73 percent of millennials, know that 700 is usually a good credit score.

In part, these differences probably reflect the fact that those who have ever obtained their credit score or their credit report know more than those who have not.  On nine key knowledge questions, the differences between those who had obtained a credit score in the past year, compared to those who had not, ranged from 10 to 20 percent points.  On the same knowledge questions, the differences between those who had ever obtained a free copy of their credit report, and those who had not, ranged from 11 to 26 percentage points.

Not surprisingly, because they are younger, millennials are less likely than older Americans to have obtained either.  Nearly two-thirds (65%) of gen-exers, but only about half (51%) of millennials, said they had ever obtained a free credit score.  And nearly four-fifths (79%) of gen-exers, but less than three-fifths (57%) of millennials, said they had ever obtained a free copy of their credit report.

However, millennials are very aware of their knowledge limitations about credit scores.  Only 42% of millennials, compared to 57 percent of gen-exers, said their knowledge of credit scores was good or excellent.

How Consumers Can Raise Their Credit Scores

In brief, consumers can raise their credit scores or maintain high scores by:

  • Consistently making their loan payments on time every month.
  • Using a small portion of the credit available on a credit card.
  • Paying down debt rather than just moving it around, as well as not opening many new accounts at the same time.
  • Regularly checking their credit reports to make sure they are error-free. That can be done for free by contacting or by calling 877-322-8228.

Contact: Jack Gillis, CFA, 202-737-0766; Jeff Richardson, VantageScore Solutions, 203-363-2170

The Consumer Federation of America is an association of more than 250 non-profit consumer groups that, since 1968, has sought to advance the consumer interest through research, education, and advocacy.

VantageScore Solutions, initially developed by America’s three national credit reporting companies (CRCs) — Equifax, Experian and TransUnion —is the independently managed company behind the VantageScore credit scoring model. This year marks its tenth anniversary.