Minnesotans have good credit. I hear that a lot. And now there are two back-to-back reports that say the rumors are true.

The first was a survey from Experian that I wrote about a couple of weeks back:

 With an average score of 787, the Minneapolis metro area topped a list dominated by Midwestern cities. Madison, Wis., came in a couple of points behind with 785, followed by Cedar Rapids, Iowa, and Green Bay, Wis. Duluth ranked 14th out of 142 cities, with an average score of 773.

The "State of Credit" report released by the credit bureau Experian was based on VantageScore data collected during the first half of 2010. VantageScore is a lesser-known score created by the credit bureaus to compete with the FICO score, the dominant credit score developed by Minneapolis-based Fair Isaac Corp. VantageScore is calculated on a scale of 501 to 990 and gives corresponding letter grades.

TransUnion, another credit bureau, sliced the data differently. According to its survey, released days later, one in four consumers in the metro area have credit that's worthy of an A grade on the VantageScore scale. But the gist is the same. We have better credit than other areas in the country. But why?

On-time payment of credit obligations is critical to a healthy credit score. But when consumers don’t have liquidity, the payment of those obligations often becomes more difficult,” said Steven Katz, senior director of consumer brand for TransUnion.

In an area like Minneapolis-St. Paul, we see relatively low unemployment and a comparatively steady housing market, both of which contribute to consumer liquidity and are likely factors leading to the market’s high A-grade ranking.

His response made me wonder about the other reasons why we might have better scores in the Twin Cities than elsewhere. So I put the question: "Why do Minnesotans have relatively good credit?" to one of my go-to guys on credit scores. John Ulzheimer used to work at FICO and is now a credit expert for credit.com. His take?

  1. The midwest isn't marketed to as aggressively as the coastal states. That means less credit card debt, fewer credit card defaults...and thus higher scores.
  2. Don't discount the influence of midwest values on your very high scores. Consumers who are more willing to honor their obligations are always going to score higher than those who do not.

I've heard the midwestern values argument before. I almost buy it. But then I think about Petters and Hecker and Trevor Cook and the readers who call and admit that they're walking away from their mortgages and I wonder if we're really any different?

What should all of this best score, A score, highest score hulabaloo mean to you? Honestly, nothing. I mean, it's a good piece of trivia to have if you need to liven up an incredibly dull dinner party. But really, the only credit score that matters is your own. Pay your bills on time and don't use all of your available credit and you'll be on the path to a pretty good score. For more detail on how a FICO credit score is calculated, check out www.myfico.com and www.whatsmyscore.org. I'm sending you to FICO links rather than VantageScore because it's the score that financial institutions still tend to use most when assessing risk.