Understanding Credit: Part One

This is part one of a three part series on credit by our Credit Manager, Cathy Latiolais. Cathy has over 17 years of experience with lending and has helped thousands of members over the years.

Creditworthiness represents a person’s ability to borrow.  Credit reporting Organizations use the credit scoring system to determine whether a specific person is creditworthy and attempts to predict the likelihood a person will make payments for goods and services.   Two types of credit information play a very big role in determining whether a person has access to credit.

  1. The Credit Report
  2. The Credit ScoreSavvyMoney

Establishing credit can be difficult and it requires taking steps that help create a more favorable financial future.  Many people may think that paying off charges every month and never borrowing  money is the key to a better financial future but, an excellent credit history is using credit wisely and avoiding common misconceptions about credit itself.  Pay your bills on time, review your credit report annually at annualcreditreport.com to determine if there are errors or any unpaid debts, and prove your ability to handle credit. Gulf Coast Educators also offers a financial wellness tool called SavvyMoney. This program gives your instant access to your credit score, credit report, personalized money-saving offers, and financial education tips.  Simply log in from your computer or mobile app and click “Launch SavvyMoney” to get started. These are all steps a person can take to ensure their credit score stays strong and healthy.

Information that is stored on a Credit Report

Positive information is saved on the credit report for 10 years from the date the account is closed. Negative information is saved on the credit report for 7 years from the date of the first delinquency that leads to the final default, charge off or foreclosure.  Below is a list of items that are most frequently asked about.

  1. Tax Liens, Financial Judgements and Chapter 13 Bankruptcy is stored for 7 years
  2. Chapter 7 Bankruptcy is stored for 10 years
  3. Unpaid Tax liens are stored indefinitely.
  4. Inquiries are stored for 2 years.

Obtaining a free copy of your credit report

The FCRA includes a “Fair Disclosure Rule” which requires each of the credit reporting agencies to provide consumers with a free copy of their credit report once every 12 months on request or if special circumstances arise.  Equifax, Transunion and Experian use a single point of contact for processing credit report requests.

Po Box 105281
Atlanta, GA 30348

A consumer can also receive a free credit report if once of these three situations occur.

  1. A company reports an action that has an adverse impact on your credit.
  2. You become unemployed (unemployed individuals can ask for a credit report if they plan to seek employment within 60 days)
  3. Identity Theft.

 

Read Part Two

Post author: Cathy Latiolais, Credit Manager

The opinions expressed on this page are for informational purposes only and is not intended to provide legal or financial advice. The views expressed are those of the author of the article and may not reflect the views of the credit union.

Preparing for a Teen Driver

Children grow up too fast. One day they are playing with toy cars, and the next they are preparing to take their driver’s test. The old saying, “the older they get, the more they cost you” rings true in many situations, but in this one especially.

My youngest daughter earned her learner’s permit recently and has begun the rite of passage of becoming a licensed driver. Luckily, my wife and I have learned our lessons from our oldest child and are better prepared this time around. Adding a new driver in the family has many implications, including several financial considerations.

Insurance

One pleasant surprise that many don’t know about, is that while your teen has their learner’s permit, they are fully covered under their parents’ insurance (most carriers won’t charge you, but it is good to ask just in case). Once your teen gets their driver’s license, it is a very different (and expensive) story. I was shocked at how much it cost to add my oldest daughter to our insurance. This time around I won’t be as surprised, but I will definitely shop my insurance to see if I can lessen the financial impact. Luckily the credit union now has its own licensed insurance agent who can do all the shopping for me so I can compare the best quotes.

Buying Another Vehicle

Another important decision is whether you plan to buy a vehicle for your new driver. In my family’s case, we let our oldest daughter drive one of our cars that was already fully paid off. With my youngest, we quickly realized there wouldn’t be an older vehicle to give her. Reluctantly, we started putting some money aside so that we would be able to buy a reasonably-priced used car when she’s ready.

If you plan to purchase your teen a vehicle and finance it, remember that any financing would be in your name, and would be your responsibility. The credit union has a free vehicle search engine you can use, where you can search for new and used cars with our preferred car dealers. If you have any questions along the way, feel free to reach out to your credit union for help.

Maintenance Costs

Regardless of whether your teen will have their own vehicle or share one with the family, there will be added maintenance costs. More vehicles mean more registrations, oil changes, potential issues, and other sometimes unexpected upkeep costs that can be expensive. Even if you plan to share a vehicle, the added wear and tear on a vehicle will increase your maintenance costs, and is something that you should be prepared for.

Not only is driving a huge step up in responsibility for your teen, but for you as a parent as well. Extra costs to the family budget means taking the time to look over your finances and preparing early so that you are not blindsided by any expenses. I highly recommend discussing these added costs with your teen, so they realize that driving is a privilege that comes as a cost and not a right.

 

Post author: Jamieson Mackay, CCUFC

The opinions expressed on this page are for informational purposes only and is not intended to provide legal or financial advice. The views expressed are those of the author of the article and may not reflect the views of the credit union.

 

 

Exploiting the Coronavirus: Financial Relief Scam Targeting Organizations

Exploiting the Coronavirus: Financial Relief Scam Targeting Organizations

The coronavirus pandemic continues to impact organizations across the globe. This hardship gives cybercriminals the perfect bait: a promise of financial relief. Currently, cybercriminals are impersonating the United States Small Business Administration (SBA) with a very convincing phishing email. While this specific scam targets organizations in the US, this tactic could be used in any country, for any kind of relief fund.

The phishing email states that your loan application has been approved and it includes a link to “start the funding process”. If you click this link, you are taken to a phony login page that is nearly identical to the SBA’s official website for the relief fund. The bad guys are phishing for these specific login credentials to gain access to sensitive data, such as your organization’s federal tax ID and banking information. This type of information, in the hands of a cybercriminal, would be a disaster.

Here’s how you can stay safe from scams like this:

  • Never click on a link in an email that you were not expecting.
  • When an email asks you to log in to an account or online service, log in to your account through your browser and not by clicking the link in the email. That way, you can ensure you’re logging in to the real website and not a phony look-alike.
  • Call the organization in question. Just be sure to look up the official phone number—do not call the phone number provided within the email.

If you have any questions or feel like you may be a victim of fraud, please do not hesitate to contact your credit union’s fraud department by calling 281-487-9333.

Post Author: The KnowBe4 Security Team – KnowBe4.com
The opinions expressed on this page are for informational purposes only and is not intended to provide legal or financial advice. The views expressed are those of the author of the article and may not reflect the views of the credit union.

Strategies to Stay Financially Sane During the Coronavirus

Strategies to Stay Financially Sane During the Coronavirus

SavvyMoney Infographic
 
 
 
 
 
 
DO: Check your credit score to know where you stand.
Keeping track of your financial standing is important no matter what the world looks like. Checking your credit score periodically will help you set goals. GCEFCU offers free credit report monitoring within Online Banking with our free tool SavvyMoney.

DON’T: Avoid credit card payments.
Even if money is tight, do what you can to pay at least the minimum amount on your credit card bills each month. Try to avoid late fees and any impact to your credit score.

DO: Beef up your emergency savings.
A stimulus check may help you bear the weight of this global pandemic. If you do not need that money immediately, stow it away for later, don’t let it burn a hole in your pocket.

DON’T: Rack up your credit card bills.
Don’t shop just because of the 20% off tag. Remember: you only save money when sale shopping if you were going to buy that item at full price anyway.

DO: File for unemployment if you qualify.
Thanks to the CARES Act, the federal government is issuing an additional $600 per week for all of those who qualify on top of the state unemployment checks they already get.

DON’T: Take it personally if you lose your job.
Spend time caring for yourself, keep busy with things you never had time for while you’re looking for work. This too shall pass.

DO: Allow yourself to feel things.
Financial health scares can cause feelings of sadness and anxiety. Allow yourself to be stressed, and do things to combat those feelings. Exercising and reaching out to friends can help turn things around.

DON’T: Ignore your finances.
Even though it is definitely stressful to face the reality of your financial situation, keeping an eye on your standing will be beneficial both now and in the future. Now is a good time to take a look at your overall finances (checking, savings, retirement, credit limits, etc.).

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

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Post author: Jean Chatzky

The opinions expressed on this page are for informational purposes only and is not intended to provide legal or financial advice. The views expressed are those of the author of the article and may not reflect the views of the credit union.

Using the financial tools provided

My wife called me the other day gushing about how easy it was to transfer money to our daughter at college. My daughter texted her the receipt for her books and using only one hand, my wife transferred the funds to her account to cover the cost. They both love our mobile app because my daughter can quickly see how much Starbucks she can afford and my wife because she can see how much Starbucks is being consumed. A win-win I would say.

But seriously, my wife felt at ease sending our daughter to college a year early from a financial perspective because she’s been able to monitor and coach our daughter on her spending habits. It’s no accident either. We opened her student checking account when she was 15 because she was highly motivated and got a job. We taught her everything that comes with getting a paycheck like setting some aside into savings, how to track your spending and how to sign up for direct deposit. These are all things that adults must do but she did it at 15.

It is one of our service promises

Making it easy to do business with us is one of the credit union’s service promises and we use it to help us decide which projects to implement and when we review our processes. Several years back, we would get several members contact us as they were ready to send their kids off to college asking about prepaid debit cards to send with their kids. They wanted something that was easy to monitor and be able to easily add funds. We would always respond by letting the members know that all those things are already available but without the prepaid debit card fees – our free checking account.

The credit union also made a concerted effort to promote the student checking account and give parents the tools they needed to monitor their kids’ spending so that when they do go off to college, both the parents and kids already have a high degree of comfort with the process.

Take a deep dive

I highly recommend taking a deep dive into the digital tools at your disposal. You’ll potentially find other ways that can make the financial life of you and your children easier. Just a few examples:

  • Account alerts can help you track spending and avoid any issues from getting out of hand
  • The spending analytics can help you show your kids where their money is going in an easy to read graphical format
  • Using the app to find surcharge free ATMs
  • Remote deposits for any checks they may receive

If you have any additional ways that digital tools offered by your credit union are helping you and your child navigate the financial world, I’d love to hear them. My wife and I are always looking for ways to improve in this area too.

 

 

Post author: Jamieson Mackay, CCUFC

The opinions expressed on this page are for informational purposes only and is not intended to provide legal or financial advice. The views expressed are those of the author of the article and may not reflect the views of the credit union.

 

Pace yourself after purchasing your first house

One of my teammates at work just purchased his first house. As expected, he’s very excited and has already shared all of his projects he’s got planned. This is not uncommon when someone buys their first house and begins to look forward to having it set up just like it was in their imagination when they first viewed the house for the first time. I remember back to the first starter house my wife and I bought shortly after I started working at the credit union. Over time, I’ve made some observations about friends and family as they’ve made their first home purchase.

Ease into it

It is very easy to get carried away with your first home. Usually, when you buy your first home, you are either moving out of your parents’ house or out of an apartment. Either way, you have newfound space and freedom. One of the biggest mistakes I’ve seen is trying to fill the entire house with new furniture. Usually, shortly after moving in and before the first mortgage payment is made, a trip to the furniture store leads to over purchasing. Next thing you know, the mortgage and the first payment on that house full of furniture come due at the same time. I believe this may be where the term house poor comes from. Ease into adding furniture a bit at a time and never overlook a possible hand me down from friends and family.

Same goes for home improvement projects. They tend to be expensive too, and the cost can add up really quickly. Prioritize the projects in regard to need and value returned.  Is it cosmetic or important to the integrity to the house?

 Budget for the unexpected

First time homeownership brings with it the joys that you hear about but also the unexpected expenses that you didn’t have with an apartment. Something broke? No call to apartment office now as you are on your own. Try to set aside savings for repairs and appliance replacement if you bought a used home. I’d like to be more specific with my advice here but like I said, they are unexpected expenses. You’ll know them when they happen because you’ll think to yourself that you didn’t see that coming.

Don’t be afraid to ask for help or advice

Chances are you know plenty of people who have owned homes before. Lean on them for advice and never be afraid to ask for help. Your home is the biggest purchase you’ll ever make and it is important to get things right when it comes protecting the value in it.

Most of all, enjoy the fact that you are now a homeowner. You have your own space that is yours to do with what you want (within reason if you have an HOA) so you can make it what you’ve always wanted in a home. Just remember to take it slow.

 

 

Post author: Jamieson Mackay, CCUFC

The opinions expressed on this page are for informational purposes only and is not intended to provide legal or financial advice. The views expressed are those of the author of the article and may not reflect the views of the credit union.

 

Teacher Appreciation Week Giveaway!

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Not your father’s back to school time

This should be one of the busiest and most exciting times of year for our credit union. Back to school time represents a whirlwind experience for our team where the entire management team and other team members attend countless back to school and new employee events with giveaways and door prizes. It was so much fun!

Thanks to our members

A special thank you to our members who work in the school districts for putting students first. This year teachers have put in way more time than normal during the summer with professional learning. My wife, for example, has had to write curriculum for in person and online learning. Special trainings to shore up online learning have been mandated. Administrators have spent the summer trying to make sure school can open safely. Teachers and school employees have a lot of uncertainty about whether they’ll be teaching online or in person, but they all have one goal – make sure they connect with their students and help them learn in the safest way possible.social distancing classroom

Back to school shopping change

There’s no doubt that back to school shopping has changed this year. For those who’ve selected to have their children attend online, the back to school shopping list will look very different than it did last year. Switching from pencils and notebooks to laptops and tablets means back to school shopping may be more expensive than ever. For those who have decided to go back to brick and mortar, there will be additional supplies such as sanitizer and masks. Furthermore, the big annual back to school shopping event has been pushed back with news that most schools are starting online, even if you choose the brick and mortar option. The tax-free weekend will still take place August 7-9 with social distancing measures in full effect at retail stores.

Need our members’ help

The old saying that if you aren’t growing, you’re dying seems so appropriate right now for most organizations. New members are the credit union’s life blood and the way we grow stronger as a membership-based organization. We need our members help more than ever to help us reach the new teachers and help grow our membership base.

Yes, the 2020 back to school time is certainly not the way it used to be, but we see how our school districts are rising to the challenge. We see how caring the employees of school districts are and how focused they are on taking care of children.

 

 

 

 

 

 

Post author: Jamieson Mackay, CCUFC

The opinions expressed on this page are for informational purposes only and is not intended to provide legal or financial advice. The views expressed are those of the author of the article and may not reflect the views of the credit union.