Credit Scores

1.             Review
the following information from the Federal Trade Commission.

Source:  http://www.ftc.gov/bcp/edu/pubs/consumer/credit/cre34.shtm

2.            
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. The FCRA promotes
the accuracy and privacy of information in the files of the nation’s consumer
reporting companies. The Federal Trade Commission (FTC), the nation’s consumer
protection agency, enforces the FCRA with respect to consumer reporting
companies.

3.             A
credit report includes information on where you live, how you pay your bills, and
whether you’ve been sued or arrested, or have filed for bankruptcy. Nationwide
consumer reporting companies sell the information in your report to creditors,
insurers, employers, and other businesses that use it to evaluate your applications
for credit, insurance, employment, or renting a home.

4.             Here
are the details about your rights under the FCRA and the Fair and Accurate Credit
Transactions (FACT) Act, which established the free annual credit report program.

5.             Question:
How do I order my free report?

The three nationwide consumer reporting companies
have set up a central website, a toll-free telephone number, and a mailing
address through which you can order your free annual report.

To order, visit annualcreditreport.com, call
1-877-322-8228, or complete the Annual Credit Report Request Form and mail it
to: Annual Credit Report Request Service, P.O. Box 105281, Atlanta, GA
30348-5281. The form is on the back of this brochure; or you can print it from
ftc.gov/credit. Do not contact the three nationwide consumer reporting
companies individually. They are providing free annual credit reports only
through annualcreditreport.com,
1-877-322-8228, and Annual Credit Report Request Service, P.O. Box 105281,
Atlanta, GA 30348-5281.

You may order your reports from each of the three
nationwide consumer reporting companies at the same time, or you can order your
report from each of the companies one at a time. The law allows you to order
one free copy of your report from each of the nationwide consumer reporting
companies every 12 months.

6.             A
Warning About “Imposter” Websites

Only one website is authorized to fill orders for
the free annual credit report you are entitled to under law —
annualcreditreport.com. Other websites that claim to offer “free credit
reports,” “free credit scores” or “free credit monitoring” are not part of the
legally mandated free annual credit report program. In some cases, the “free”
product comes with strings attached. For example, some sites sign you up for a
supposedly “free” service that converts to one you have to pay for after a trial
period. If you don’t cancel during the trial period, you may be unwittingly agreeing
to let the company start charging fees to your credit card.

Some “imposter” sites use terms like “free report”
in their names; others have URLs that purposely misspell annualcreditreport.com
in the hope that you will mistype the name of the official site. Some of these
“imposter” sites direct you to other sites that try to sell you something or
collect your personal information.

Annualcreditreport.com and the nationwide consumer
reporting companies will not send you an email asking for your personal
information. If you get an email, see a pop-up ad, or get a phone call from
someone claiming to be from annualcreditreport.com or any of the three
nationwide consumer reporting companies, do not reply or click on any link in
the message. It’s probably a scam. Forward any such email to the FTC at
spam@uce.gov.

7.             Question:
What information do I need to provide to get my free report?

You need to provide your name, address, Social
Security number, and date of birth. If you have moved in the last two years,
you may have to provide your previous address. To maintain the security of your
file, each nationwide consumer reporting company may ask you for some
information that only you would know, like the amount of your monthly mortgage
payment. Each company may ask you for different information because the
information each has in your file may come from different sources.

8.             If
students have access to computers and they are at least 13 years of age, they can
order their credit reports.  If students
cannot access individual reports, click on the link to the sample credit report
from Experion. (http://www.experian.com/credit_report_basics/pdf/samplecreditreport.pdf)

Review the sample report, identifying the
information it includes.

NOTE:   The
free credit reports from AnnualCreditReport.Com do not include FICO or other
credit scores.  For more about credit
scores, go to the “My FICO”
site: http://www.myfico.com/crediteducation/creditscores.aspx

1.         Review the following information from
the Federal Trade Commission.

Source:  http://www.ftc.gov/bcp/edu/pubs/consumer/credit/cre34.shtm

1.         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. The FCRA promotes the accuracy
and privacy of information in the files of the nation’s consumer reporting
companies. The Federal Trade Commission (FTC), the nation’s consumer protection
agency, enforces the FCRA with respect to consumer reporting companies.

2.         A credit report includes information on
where you live, how you pay your bills, and whether you’ve been sued or
arrested, or have filed for bankruptcy. Nationwide consumer reporting companies
sell the information in your report to creditors, insurers, employers, and other
businesses that use it to evaluate your applications for credit, insurance,
employment, or renting a home.

3.         Here are the details about your rights
under the FCRA and the Fair and Accurate Credit Transactions (FACT) Act, which
established the free annual credit report   program.

4.         Question: How do I order my free report?

The three nationwide consumer reporting companies have set up a central website, a toll-free telephone number, and a mailing address through which you can order
your free annual report.

To order, visit annualcreditreport.com, call 1-877-322-8228, or complete the Annual
Credit Report Request Form and mail it to: Annual Credit Report Request Service,
P.O. Box 105281, Atlanta, GA 30348-5281. The form is on the back of this brochure; or you can print it
from ftc.gov/credit. Do not contact the three nationwide consumer reporting
companies individually. They are providing free annual credit reports only through annualcreditreport.com,
1-877-322-8228, and Annual Credit Report Request Service, P.O. Box 105281,
Atlanta, GA 30348-5281.

You may order your reports from each of the three nationwide consumer reporting
companies at the same time, or you can order your report from each of the
companies, one at a time. The law allows you to order one free copy of your report
from each of the nationwide consumer reporting companies every 12 months.

5.         A Warning About “Imposter” Websites

Only one website is authorized to fill orders for the free annual credit report you are entitled to under law —
annualcreditreport.com. Other websites that claim to offer “free credit
reports,” “free credit scores,” or “free credit monitoring” are not part of the
legally mandated free annual credit report program. In some cases, the “free”
product comes with strings attached. For example, some sites sign you up for a
supposedly “free” service that converts to one you have to pay for after a trial
period. If you don’t cancel during the trial period, you may be unwittingly agreeing
to let the company start charging fees to your credit card.

Some "imposter” sites use terms like “free report” in their names; others have URLs
that purposely misspell annualcreditreport.com in the hope that you will mistype
the name of the official site. Some of these “imposter” sites direct you to other
sites that try to sell you something or collect your personal information.

Annualcreditreport.com and the
nationwide consumer reporting companies will not send you an email asking for
your personal information. If you get an email, see a pop-up ad, or get a phone
call from someone claiming to be from annualcreditreport.com or any of the
three nationwide consumer reporting companies, do not reply or click on any
link in the message. It’s probably a scam. Forward any such email to the FTC at
spam@uce.gov.

6.         Question: What information do I need to
provide to get my free report?

You need to provide your name,
address, Social Security number, and date of birth. If you have moved in the
last two years, you may have to provide your previous address. To maintain the
security of your file, each nationwide consumer reporting company may ask you
for some information that only you would know, like the amount of your monthly
mortgage payment. Each company may ask you for different information because
the information each has in your file may come from different sources.

7.         If students have access to computers
and they are at least 13 years of age, they    can
order their credit reports.  If students
cannot access individual reports, click     on
the link to the sample credit report from Experion.  (http://www.experian.com/credit_report_basics/pdf/samplecreditreport.pdf)

Review
the sample report, identifying the information it includes.

NOTE:   The free credit reports from
AnnualCreditReport.Com do not include FICO or other credit scores.  For more about credit scores, go to the “My FICO”
site: http://www.myfico.com/crediteducation/creditscores.aspx

1.         Introduce the video program by asking the students if they have heard of “credit         counseling.”  Explain that credit counselors work with people who have debt problems.  Credit counselors advise people about spending and budgeting, or they may help them with a plan to reduce their debt.

 2.         Explain that his three-minute video is an interview with a credit counselor, Mary          Hurlburt.  Ms. Hurlburt gives some simple tips about dealing with loss of income        or accumulated debt.

 3.         Show the three-minute “Financial Beat” video.             http://www.cetconnect.org/VideoPlayer.aspx?vid=3905

4.         After the video, ask: What were some of the tips Ms. Hurlburt gave to those who        are experiencing financial problems?

           •  Keep track of your spending.  Know where your money goes.

            •  Think lean - Identify what you can give up if you have less income.

            •  Ask for help from a credit counselor.

            •  Involve the whole family in decision-making.

            •  Make a plan for potential problems.

            •  Save an emergency fund.

            •  Be honest with your creditors.

5.         Ms. Hurlburt briefly discusses “credit scores.”   A credit score is a numerical   value determined by a credit rating agency or credit provider based on a person’s       creditworthiness (credit use and debt repayment history).

Credit (FICO) scores range from 300 to 850.  The higher the score, the better. A FICO score is the most commonly used credit score.  A FICO score below 600 may be considered high risk.  A FICO score over 690-720 is generally considered to be excellent.

             More information: http://www.myfico.com

            Online lesson: http://www.myfico.com/CreditEducation/WhatsInYourScore.aspx

 6.         What factors determine a person’s credit score? 

             •  How you pay your bills (35%)

            •  How long you have had credit (15%)

            •  What you owe – debt ratio (30%)

            •  New credit – number of credit inquiries (10%)

            •  Other factors (10%)

 7.         The last part of the discussion is about what a person should do when they     realize they have credit problems.  Ask: What was Ms. Hurlburt’s advice?                

            •  Order your free credit reports. (www.annualcreditreport.com)

            •  Don’t apply for more credit.  

            •  Credit payments should be no more than 30% of your disposable income.