Consumer Credit Literacy: What Price Perception?

15 Pages Posted: 22 Mar 2009

See all articles by Peter M. Zorn

Peter M. Zorn

Freddie Mac

Adam Gailey

RAND Corporation

Marsha Courchane

Charles River Associates (CRA)

Date Written: March 30, 2007


This paper considers the question of whether inaccurate self-assessment of credit is associated with undesirable financial market outcomes. Our analysis is empirical, and relies on two different data sets - a consumer survey conducted in 2000 by Freddie Mac, and 1.2 million mortgage loans originated in 2004. We find some support for our hypothesis that inaccurate self-assessments lead to increased probabilities of being denied credit, experiencing a "bad" financial event, or having a higher annual percentage rate on a mortgage.

Keywords: Financial Literacy, Consumer Credit

JEL Classification: G21, G28

Suggested Citation

Zorn, Peter M. and Gailey, Adam and Courchane, Marsha, Consumer Credit Literacy: What Price Perception? (March 30, 2007). Journal of Economics and Business, Vol. 60, Nos. 1-2, 2007. Available at SSRN:

Peter M. Zorn

Freddie Mac ( email )

1551 Park Run Drive
McLean, VA 22102
United States
(571) 382-3220 (Phone)
(571) 382-5074 (Fax)

Adam Gailey

RAND Corporation ( email )

1776 Main Street
P.O. Box 2138
Santa Monica, CA 90407-2138
United States

Marsha Courchane (Contact Author)

Charles River Associates (CRA) ( email )

1201 F Street, NW
Suite 700
Washington, DC 20004
United States

Register to save articles to
your library


Paper statistics

Abstract Views
PlumX Metrics