Walking into a bank, few people are up-to-date on the shape of their credit.
"I'd say less than half will know their score before they come in and apply for a loan," Paul Dannevik, Senior Vice President for Lubbock National Bank said.
A provision in the new financial reform law wants to make that number less mysterious to consumers. Now banks are responsible for providing you a free copy of your actual score under certain conditions. "Such as, in the event that they are declined for a loan. We give them an adverse action notice and a copy of their credit report and score," Dannevik said.
Furthermore lenders at Lubbock National Bank sit down with applicants to explain the scoring system. "So they understand why they got the rate that they qualified for or why they were not approved for a loan," Dannevik said.
Since your scores affect everything from the interest rate you pay toward you car, mortgage, and student loans, lenders say it's worthwhile to be proactive and improve your number.
"It does take some effort by the consumer. It's important to track your credit score, knowing what it is before you apply for a loan and also checking to make sure there's not something on there that shouldn't be," Dannevik advises.Under the new guidelines, banks will also hand over your credit score if you're approved for a loan but not given the best interest rate available, so you'll know why you're being charged more than other customers.
