The Bait & Switch is Alive and Well

The Bait & Switch is Alive and Well

Car shopping is one of those activities that most of us only do every several years. I hadn’t bought a car in over 8 years when in the span of a year and half, I bought two. So in the last decade, I’ve bought 3 vehicles and the buying experience had a common element each time: the old bait and switch. You find a car or truck you are interested in and go to the dealership only to find out that the one you wanted isn’t available but there are several like it (always at higher prices) available. Why am I writing about this now since I haven’t bought a vehicle in a few years? A coworker was telling me about his recent experience, and it gave me flashbacks. We handled the same experience in two very different ways but we both had something in common.

Walk Away

In my case, once I identified the bait and switch, I simply walked away, but not before test driving the vehicle they did want to show me. I then went online to find a vehicle with a different dealership and did the whole transaction via email and phone calls. There was no bait and switch this time and I got the vehicle I wanted at the price I wanted.

Call Them on it

My coworker had a completely different approach. He called the salesman on it and straight up told him that he knew it was a bait and switch situation. Realizing he was caught, the salesman became very transparent and even let the sales manager know that the customer he was dealing with was aware of such tactics and that he would not put up with them. Now they knew that my coworker was prepared and knew that he expected complete honesty. He didn’t buy a vehicle on that day, but hasn’t ruled out that dealership because he feels like now they know they have to work with him on his terms.

Be prepared

Both ways of handling the same situation had similarities that can help with any car buying experience. The main similarity is the preparation that should go into buying a vehicle. Here are some preparations both of us use that we’ve learned through working at the credit union:

  • Be willing to walk away. Set a price ceiling and don’t go above it.
  • Get preapproved for a loan. Knowing you have financing secured puts you in control.
  • Do your vehicle research: tools for researching vehicle from top to bottom are plentiful. You should go into the dealership knowing about the different engine options, trim packages, etc. and associated costs.
  • Don’t be afraid to ask questions. Don’t feel comfortable with the process, ask a friend, family member or one our team members about the process.

Buying a vehicle can be a stressful experience and if the bait and switch is in play, it can add even more stress. Preparation and deciding how you’ll respond are keys to making the experience more pleasant.

 

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.

 

High School Seniors: Do you FAFSA?

High School Seniors: Do you FAFSA?

The credit union has made its scholarship application for the graduating seniors of the class of 2021 available. I have a daughter in that class who plans on attending Texas A&M in the fall of 2021. Pausing for all of the whoops….and that’s enough. So along with encouraging every one of our members who is in the class of 2021 to apply for the credit union’s scholarship, I would also like to ask the question: Did you complete the FAFSA?

It’s not a new dance

When my wife first told me we had to complete the FAFSA, I had to ask for clarification, and she confirmed it isn’t a new dance popular with my daughter and her friends. No, the FAFSA is the Free Application for Federal Student Aid, and both the student and their parent(s) should complete it. The deadline for priority consideration for the ‘21-‘22 academic year in Texas is January 15, 2021.

What if I know I won’t qualify?

You should do it anyway. Many schools now require a completed FAFSA even for academic or merit-based scholarships. It is never a good idea to leave money on the table, so filling it out makes sense.

Be forewarned, the FAFSA does require you providing a lot of financial information that some may find very intrusive. Some of the information you’ll need to complete the FAFSA includes:

  • Social Security Number
  • Driver’s License
  • Tax Returns
  • Account balances for checking, savings, and investments
  • For complete list, click here.

The process shouldn’t take too long and could end up helping you with money towards your child’s college. Also, if your circumstances change, you’ve already gone through the process and will only need to simply update the information on application.

 
 

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.

Speaker Series: Principal Baruti Kafele

Principal Baruti Kafele: America’s “Discomfort Speaker”

We invite you to join us for this free webinar as Principal Kafele will inspire current and future school administrators to look deeply within themselves toward assessing their own practices to a level of “discomfort within their comfort.”

 
About Principal Kafele: A highly-regarded urban educator in New Jersey for over twenty years, Principal Baruti Kafele distinguished himself as a master teacher and a transformational school leader. As an elementary school teacher in East Orange, NJ, he was selected as the East Orange School District and Essex County Public Schools Teacher of the Year, he was a New Jersey State Teacher of the Year finalist, and a recipient of the New Jersey Education Association Award of Excellence.

As a middle and high school principal, Principal Kafele led the turnaround of four different New Jersey urban schools, including “The Mighty” Newark Tech, which went from a low-performing school in need of improvement to national recognition, which included U.S. News and World Report Magazine recognizing it three times as one of America’s best high schools.

One of the most sought-after school leadership experts and education speakers in America, Principal Kafele is impacting America’s schools! He has delivered over two thousand conference and program keynotes, professional development workshops, parenting seminars and student assemblies over his 34 years of public speaking. An expert in the area of “attitude transformation,” Principal Kafele is the leading authority for providing effective classroom and school leadership strategies toward closing what he coined, the “Attitude Gap.”

Learn more about Principal Kafele
 

Books mentioned in webinar:

  • The ASSISTANT Principal 50
  • The ASPIRING Principal 50
  • Is My School a Better School BECAUSE I Lead It?
  • The Principal 50
  • The Teacher 50
  • Closing the Attitude Gap
  • Motivating Black Males

For more upcoming speaker series, click here.

 

Understanding Credit: Part Three

This is the final installment 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. Need to catch up? Part One | Part Two

Actions that can undermine a healthy credit score

Computer with image of Savvy MoneyThere are several actions that a person can do that will lower the credit score and cause you to be a higher credit risk.

  1. Missing Payments. Missing a single payment on any obligation reported can drop the credit score 50-70 points. Missing payments more frequently will penalize you more severely than someone who does not.
  2. Maxed out credit cards. Maxing out your credit cards can lower your score by as much as 100 points.  Try keeping the balance between 20-30% of your credit limit.
  3. Closing Credit Lines. When you close a credit line it will reduce your capacity.  Positive credit will remain on your report indefinitely, however, closed accounts in good standing are usually removed from the credit report 10 years after closing.  Open or closed, once that account is removed from the report all of that good history is gone.
  4. Aggressively applying for credit. When you fill out a credit application you are giving that lender permission to pull your credit.  When this is done it is called an inquiry.  The inquiry will remain on your credit report for 24 months but will only impact your score for 6 months.   The more inquiries you have the more it can hurt your score.  However, consumers are not penalized for shopping for the best rates on Mortgages, Auto, and Student Loans.  Any number of these types of inquires will only count as 1 if it is within 14 days.  This is not the case when apply for credit cards.
  5. Opening multiple new credit lines and loans in a short time. New debt, transferred debt and increasing credit lines can temporarily lower the score if done within 6-12 months.  When combined with multiple inquires the damage to the credit score is even greater.
  6. Using only revolving debt. Its important to have a good mix of installment and revolving debt.  This shows the lender you are able to handle different kinds of debt.

 

Five simple steps to improving your credit score.

Whether you have high interest rates or are just getting outright declined when applying for credit you can follow these five simple rules to help restore your credit score.

  1. Pay bills on time
  2. Keep bills current and under the credit limit.
  3. Maintain low balances on your credit cards. 30% or lower will improve your score quicker
  4. Apply for new accounts only when necessary.
  5. Verify your credit report for accuracy.

Repairing the credit score can take time, but given the high cost of bad credit its worth while. If you are interested in improving your credit score, get in touch with one of our lending team members or use our free SavvyMoney tool which has great financial articles written by financial experts including Jean Chatzky.

 

 

 

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.

When ID Theft Becomes Real

Identity theft is on the rise. How do I know? Not because I searched online and found numerous sources quoting statistics that show the trend. No, I know because it happened to me. Our HR department reached out to me to let me know that they had received an unemployment claim from Texas Workforce under my name and social security number. I filed no unemployment claim because the credit union has not laid off employees during the pandemic.

Take Action

If you find out that you have become the victim of ID theft, take action and do it quickly. The credit union reported the unemployment fraud and I did the same by reaching out to the Texas Workforce Commission.

The next thing I did was to put a freeze on my credit because ID thieves love opening fraudulent loans. You can order a one year freeze online with Experian who will then notify the other credit bureaus. Since I use SavvyMoney in our digital banking system I was quite sure that nothing had been opened in my name because they send alerts anytime anything changes on my credit report but it is better to be safe than sorry.

More to do?

I was pretty proud of myself and thought that I’d done all I could. Then I remembered that one of the benefits of my Advantage Checking account is CyberScout ID theft resolution services. I called them and was assigned a fraud resolution specialist who worked with me to further protect my identity with additional steps that I’d never considered.

Your social security number isn’t just used to file for benefits and apply for loans. It is used for opening accounts where said benefits or loan proceeds are deposited. Most financial institutions use a system called ChexSystems for verification when opening savings and checking accounts. I was able to put a freeze on ChexSystems just like I was for my credit report. And just like I can get a class=”external” free credit report from all three credit bureaus, I can get a free annual FACTA report from ChexSystems which shows if my information has been used to open accounts. I also reported the ID Theft to the FTC so they can share the information with law enforcement.

Be proactive

I already had some of the tools I needed in place to be proactive. SavvyMoney is one example because I can view my report at any time and receive notifications when new loans are added. But beyond tools like that, we need to be more proactive in protecting our private information. I have no idea how an ID thief obtained my information, but you can be sure the next time I’m asked for sensitive information on an online form or in person I’ll be vigilant in making sure it is only being given to a reputable organization.

I’m hoping you don’t become a victim of identity theft but if you are one of the unlucky 10% of the population who this happens to on a yearly basis, hopefully you can learn some tips from my experience.

 

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.

 

Understanding Credit: Part Two

This is part two 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. Missed part one? Find it here.

Understanding your Credit Score

phone displaying Savvy MoneyThe credit score used by most lenders is the FICO score.  The fico sore is a number that can range from a low 300 to an 850 depending on the model used by the reporting organizations.  This score reflects the individual’s ability to pay for services or repay loans.  There is a lot of miscommunication about what is included in your score.  Below is a list of information that is not included in the credit score.

  1. An interest rate being charged on a credit card or other accounts.
  2. Child or family support payments
  3. Rental Agreements

Credit scores are calculated using these 5 key factors.

  1. Payment history is 35% of the credit score. The payment history reflects if the member pays on time.  Late payments will bring down the score significantly.  This element of the score is weighted to give recent activity more consideration.  These are approximately the credit weights broken down for each year.

40% is based on current – 12 months

30% Is based on 13-24 months

20% is based on 25-36 months

10% is based on 37+ months.

  1. Capacity or better known as credit utilization is 30% of the credit score. Capacity refers to the amount of the available credit on existing revolving accounts. The key to good credit utilization is to the keep the balance at less than 30% of the credit limit.  Balances below 20% will improve your credit score further.
  2. Age of accounts is 15% of the credit score. The longer you have the account the better.  Closing an older account can lower an individual’s credit score by almost 150 points. It will reduce the average age of all open accounts and will impact your credit utilizations because there is now less credit available.
  3. Debt accumulated in the last 12-18 months is 10% of the score. This includes all new debt taken out within the last 18 months and takes into consideration balance transfers.
  4. The mix of credit is 10% of the credit score. Different types of credit are given different values in each scoring model.  For example, Mortgage debt has more weight than installment credit such as an auto loan which results in a higher value.  Whereas revolving credit like credit cards are scored at a lesser value.

In Part Three, we discuss actions that hurt your score and practical tips for improving your score.

 

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.

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.