Events Calendar
In This Section
Auto bailout could be tied to government-run overhaul
Oil plummets on dire U.S. jobs figures
Employers cut 533,000 jobs in November, most in 34 years
Merrill Lynch shareholders approve sale to Bank of America
Worried retailers report big drop in sales
One National City executive on PNC leadership team
Most Read Stories
Blogs:
Akron Law Café:
What's Wrong with Incarcerating People for Profit?
Car Chase:
Car Guy* Gatherings
The Heldenfiles:
"Survivor" Results: A Long and Winding Road … to Something Obvious
Patrick McManamon:
Browns GM Phil Savage meets media, defers questions about the future
Browns Bulletin:
Say hello to your new starting quarterback
Cleveland Browns:
Anderson done for season
Cleveland Cavaliers:
Does the LeBron James Saga Finally Die - for Now?
CavsHQ: A Fan's View:
What to Watch For - Cavs v. Pacers
Akron Zips:
Looking ahead to Dayton
Varsity Letters:
‘Gridlocks’ high school football recap
Kent State Sports:
Home winning streak snapped by St. Mary's
Ohio Politics:
Chambliss: Hey, Guess Who Impacted This Race?
See Jane Style:
Holiday Dressing Men’s Edition
All Da King's Men:
Should We Bail Out The Big Three Automakers ?
Blog of Mass Destruction:
Obama's Place In The Center For Moderate GOP'ers
HRLite House:
The ‘House’ Test
Akron Gamer:
Quick holiday game guide
Ohio Travels with Betty:
Where is the house featured in A Christmas Story?
Sound Check:
The Pretenders to play Akron Civic Theatre on Valentine's Day
Let's Talk Real Estate:
Johnny Rockets: A taste of the 50s!
It's important to check credit scores every few years. Many consumers don't understand how ratings work
Published on Sunday, Aug 17, 2008
Talk about taboo subjects: Most Americans would rather discuss their love lives with somebody they just met than how much they owe on their credit cards.
They would also rather talk about their salaries, mortgage or rent payments, health problems or religious or political views — anything, it seems, but credit-card debt, a recent poll shows.
''People who are faced with credit-card debt are unwilling to face their financial issues and therefore may be leaving them unresolved,'' said Ben Woolsey, director of marketing and consumer research for CreditCards.com. The online provider of credit-card information sponsored a survey of 1,000 Americans 18 and over that was conducted by GfK Roper Public Affairs and Media.
Thirty-five percent said they carry a balance on their cards, and 5 percent said they didn't know whether they do (I wonder, how can anybody not know?). But perhaps some people were not 'fessing up. Studies by the Federal Reserve and data released by credit-card issuers suggest the percentage of America households with card balances is at least in the mid-40s.
Maybe it is higher now, given the economic downturn. In a separate study commissioned by the Consumer Federation of America and Washington Mutual Bank (WaMu), nearly two-thirds of more than 1,000 people surveyed said they carry a revolving balance on at least one credit card.
In addition (here we go again), 8 percent said they did not know. And 15 percent said they have experienced at least ''some'' difficulty making the minimum payments.
This latest survey is the third conducted for the Consumer Federation and WaMu by Opinion Research Corp. (the others were in 2005 and 2007). These studies, focusing mostly on consumer understanding of credit scores, continue to show poor, although somewhat improving results.
For example, less than a third of Americans understand a credit score estimates the likelihood that a borrower will pay back a debt, including a credit-card balance.
Credit scores are based on, but are separate from, credit reports on our credit and loan application and payment history.
The three largest credit-reporting agencies are Equifax, Experian and TransUnion. The best known credit score is the ''FICO score'' named after the Fair Isaac Corp. that developed it (see Web site http://www.myfico.com).
The best way to improve one's credit score is by always paying bills on time. The higher the score — typical range is 300-850 — the better. Just 28 percent of Americans knew that a credit score of at least 700 is generally required to qualify for a low-rate mortgage (a 760 score might result in lower rates still).
More than a third did not know insurance companies often use credit scores to approve coverage and set rates. Less than three-fifths knew that regularly maxing out a credit card, even if paying bills on time, lowers credit scores.
In addition, 79 percent believed incorrectly that credit scores are available free once a year. That's true of credit reports only (see Web site http://www.annualcreditreport.com). Consumers generally have to pay for their scores, about $15 each.
''Consumer advocates fought very hard'' for free credit scores, said Stephen Brobeck, executive director of the Consumer Federation, but the law Congress passed in 2003 provided for free reports only.
Still, in addition to checking their reports once a year for accuracy, consumers are generally advised to check their scores perhaps every couple of years, or before they apply for a mortgage or other large line of credit. WaMu estimates consumers can reduce finance charges by $105 a year on average by raising their scores 30 points.
Send questions or comments to Humberto Cruz at AskHumberto@aol.com or c/o Tribune Media Services, 2225 Kenmore Ave., Buffalo, N.Y. Personal replies are not possible.
Talk about taboo subjects: Most Americans would rather discuss their love lives with somebody they just met than how much they owe on their credit cards.
Get the full article here.

