Supporting Content

Instructional Background Information

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Terminal objective addressed: Explain the numerical range of a credit score, how it is categorized and how it is reported.

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Enabling objectives addressed:​

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• Without referencing materials, learners will be able to identify the five credit score categories. Criterion: There are five categories (exceptional; very good; good; fair; and poor). Learners need to know the names of the categories, not the numerical ranges that correspond to each category. (cognitive, remembering)

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• Using the five categories of credit, learners will be able to distinguish what categories are considered below average, average and above average. Criterion: “Fair” and “poor” categories are considered below average; “good” is considered average; and “very good” and “exceptional” are considered above average. (cognitive, understanding)

 

• Given the numerical ranges of the different credit score categories, learners will be able to interpret their credit score in relation to its corresponding category and identify whether it is considered below average, average or above average. Criterion: The learner will classify his/her score into only one credit score category and identify it as either below average, average or above average (see objective above). (cognitive, understanding)

 

• Without assistance, learners will be able to paraphrase the process for how a score is generated and reported by each credit bureau. Criterion: Each credit bureau (Experian, Equifax and TransUnion) plugs in their own information to a FICO formula to get proprietary results. The numerical score is shared with lenders, not the formula used to calculate it. (cognitive, understanding)

 

• Recognizing that each of the three credit bureaus will most likely report slightly different scores, learners will be able to summarize the three reasons for this. Criterion:  Each credit bureau uses slightly different data; credit scores are not calculated on a fixed schedule; and credit bureaus have slightly different versions of their scoring models.  (cognitive, understanding)