Experian Study Highlights Key Differences Between Consumers With High and Low Credit Scores

A Comparison of Five Key Categories Impacting Credit Scores Reveals Interesting Differences Between Consumers in Both Groups

IRVINE, Calif., Feb. 1 /PRNewswire/ -- Experian Consumer Direct, the leading provider of online direct-to-consumer credit reports, scores and monitoring, today announced the results of a nationwide study on the differences between consumers in high and low credit score ranges. National and statewide results for the study can be found on Experian's National Score Index® Web site at www.NationalScoreIndex.com.

The Experian study compared consumers scoring less than 660 to those scoring 720 or greater. While there are many factors which impact a credit score, the Experian study focused on five key factors: monthly payment, debt (revolving and installment debt), debt usage (percentage of available credit used), number of late payments (over the past six months) and number of inquiries (over the past six months).

Managing credit responsibly is key to maintaining a high credit score. Maintaining a high credit score allows consumers to obtain better rates on loans and other borrowed credit. The study found that consumers with scores less than 660 had a significantly higher incidence of late payments as well as higher debt usage than those consumers with scores of 720 or greater. While those consumers in the higher scoring group had higher debt balances, they generally utilized less of the credit available to them. Overall the study results include:

Consumers Consumers
less than 660 720 or greater
Average monthly payment $291 $724
Average debt $6,661 $15,015
Average debt usage 27.7% 17.8%
Average number of late payments 2.32 0.0021
Average number of inquiries 3.07 1.44

"Oftentimes consumers focus too much on the three-digit number and not how their credit behavior relates to that number," said Ed Ojdana, group president of Experian Interactive(SM). "By understanding the factors in their credit report that go into calculating their credit scores, consumers will find themselves more knowledgeable about credit scores and ultimately more prepared when interacting with a lender or other financial institution looking to extend them credit."

Experian empowers consumers by offering products and information to help them proactively manage their personal finances conveniently and securely online. Products include credit reports from all three national credit reporting companies, credit score reports that show the positive and negative factors that determine their credit score, a credit score simulator that allows consumers to change the value of key credit score factors and see the impact to their credit score, and credit monitoring products that provide daily monitoring of their Experian credit report or all three national credit reports.

More information about the Experian study, plus additional credit data at the state and local levels, can be found on Experian's National Score Index Web site at www.NationalScoreIndex.com.

About Experian's National Score Index

Experian's study was compiled using the National Score Index, which is based upon a nationwide sampling of 3 million consumer credit profiles. Experian's National Score Index Web site is updated monthly with the most recent Experian data regarding U.S. consumers' credit and is a powerful indicator of the nation's overall financial health. The National Score Index monitors several components of consumer credit behavior, including average debt, credit utilization and monthly payments. The index is formulated using Experian's credit score model, which is called the PLUS Score®. Experian's PLUS Score is a numeric representation of financial behavior, based on information found in a credit report. It can range from 330 to 830 with a higher score indicating a lower credit risk.

About Experian Consumer Direct

Experian Consumer Direct is part of Experian Interactive and the market leader for online credit reports, scores and monitoring products delivered directly to consumers over the Internet. Among its products, the business provides consumers with instant access to their credit report and credit score, plus credit monitoring products that monitor all three national credit reports daily and include identity theft insurance and fraud resolution. Experian Consumer Direct has established integrated, co-branded partnerships with leading online financial destinations that provide consumers with a broad range of comprehensive online financial products and information essential to managing one's financial life. For more information, visit www.experian.com.

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Source: Experian Consumer Direct