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interest rates. Lower interest rates usually translate into more affordable monthly payments. For example, according to the MyFICO website (www.myfico.com), consumers with a good credit score (between 700 and 759) would be charged an interest rate of 6.357% on a 30-year mortgage of $250,000, for a monthly payment of $1,557. By con- trast, consumers with a poor credit score somewhere between 500 and 579 would be charged 10.31% and the monthly payment would be $2,252, which is a difference of $695 per month or $8,340 per year.
How Much Do You Know about Your Finances?
The website, www.consumeraffairs.com, cites a study conducted jointly by the consumer advocacy group Consumer Action and lender Capital One. The survey polled 1,002 men and women nationwide ranging in age from 18 to older than 70. It gauged respondents’ knowl- edge of the basics of personal finance such as budgeting, saving habits, credit principles, and basic personal finance responsibilities.
The website concludes that even though 65.1% of Americans consider themselves “very” or “highly” knowledgeable when it comes to personal finance, many fall short in a number of key areas. According to the survey:
Reading Your Credit Report