You know you should shop around when it comes to any credit product (cards, loans, mortgages).
But here's another reason to get more than one offer: Lenders are looking at a different score than the one you have, according to a new study by the Consumer Financial Protection Bureau (CFPB).
Does it matter? It could, says Gerri Detweiler, director of education for Credit.com. About one in five consumers could be placed in a different credit category based on the lender’s score, which in turn might mean worse loan rates and terms.
Detweiler says that most lender scores are customized anyway, to sort for customers they most want to attract. So the credit score they use is almost always different than the consumer or "educational" score.
Bottom line, she says: “Don’t get hung up on the number. Focus instead on the factors you can control to improve your credit."
You know the list: Check your credit report for errors; keep payments on time; use 20% or less of your available credit. And shop around. If nothing else this bolsters Mom’s advice that it pays to look for a better deal.
Fun fact: Did you know that credit scores are highest in New England, the Northwest, and parts of the Midwest? Oh, and Pennsylvania! Check out this infographic about credit across the U.S.