Consumers Don't Get Credit

It appears that most consumers are not as credit aware as they should be. A recent GMAC survey highlights that,

"A reported 62 percent of more than 1,000 consumers polled nationwide did not know that a score above 620 out of 850 is necessary to get the best mortgage interest rate and more than 50 percent thought credit scores increase as income increases, according to the GMAC Mortgage Second Quarter Consumer Survey."

What should people do then to begin to prepare to home shop in order to get the best rate?

"Having good credit is critical to getting a favorable mortgage rate so it's extremely important that consumers understand their credit score. With proper long-term planning, consumers can improve their credit rating to avoid higher interest rates, and as a result larger monthly payments on their home," said Paul Fein, senior vice president and southeast divisional manager, GMAC Mortgage.

According to Fein, consumers should start reducing their debts and outstanding revolving credit before they even begin the mortgage process.

Only 42 percent of the consumers polled knew that payment history was a critical determinant to a credit score, GMAC said."