Credit scores are vital numbers in consumers’ financial health, determining whether they qualify for mortgages, credit cards, auto loans and other products. An above-average FICO, for example, can get them the best rates, while a below-average score will saddle them with higher rates, if approved at all.
However, more than one-third (39 percent) of Americans admit they do not know their current credit scores, while more than half (52 percent) do not know that paying bills on time is the biggest determining factor, according to a new Chase Slate Credit Survey.
And if consumers haven’t checked their scores, they tend to have a skewed understanding of their credit health.
The Chase survey found that Americans who have previously checked their credit score consider a “good” score to be 719 on average. This is 51 points higher than what is considered to be good by those who have never checked their score (668).
Chase explains that many consumers may not realize that even a score of 719 might not give them access to credit at the best rates.
“Having healthy credit could mean the difference between achieving major life goals, such as buying a home or starting a small business, and never realizing those dreams,” said Pam Codispoti, President of the Mass Affluent Business for Chase Card Services. “Yet too many Americans don’t have access to information and tools that empower them to properly plan for the future and manage their credit health.”
Chase recently introduced the new Slate Credit Card, which provides card members with a “Credit Score & More” feature. Slate customers have access to their FICO score for free, as well as the factors affecting their score, a summary view of their credit bureau information and helpful suggestions to manage their credit health.
Chase is not the only major credit card issuer to offer free credit scores. Discover and Citi cards also provide free scores for some of its card members.
The Fair Credit Reporting Act (FCRA) requires each of the nationwide consumer reporting companies — Equifax, Experian, and TransUnion — to provide you with a free copy of your credit report, at your request, once every 12 months. But credit scores are not included in the free reports.
According to the Chase survey, two-thirds (66 percent) of respondents say they would like to be able to improve their credit score over the next year, yet only one-in-three (35 percent) have a plan they feel confident will allow them to succeed and one-fifth (22 percent) admit they have never taken any steps to do so. (See infographic below.)