Auto Loan

So, You’re Ready to Buy a Car

March 22, 2024

Purchasing a car is a huge financial decision with more things to consider than just what color to get. Whether you are buying your first car, a used car, or the shiny new sports car of your dreams, there is a lot to think about.

What will the payment be?  The Financial Gurus have discussed the benefits of monthly budgeting, and a vehicle payment is a large portion of that. Make sure to consider not only the monthly payment amount, but the cost of insurance, gas, and regular maintenance. Visit our website www.wwfcu.org to utilize our loan calculator tool to get an estimate of your monthly payment. Other items to think about: Do you have money to put down on it? Are you adding any extra coverage such as GAP insurance or extended warranties? Be sure to schedule an appointment with one of WWFCU’s Member Service Specialists to discuss interest rates, loan terms and get preapproved before you sign any contracts.

Do your homework. In this digital age, buying a car does not always mean various trips to the dealership to shop around. Now, you have the option to browse current vehicle inventory or build and price out a vehicle through dealer websites from the comfort of your home. Before you get started, you will want to determine if you prefer new or used, the type of vehicle you’re in the market for and what features you can’t live without.  Shiny cars with all the extra bells and whistles are tempting but stay realistic about what fits your current budget. When you’ve narrowed down your search, Wayne Westland Federal Credit Union can help you with the next steps. We will always obtain a bluebook value to ensure you don’t overpay.

Take that test drive!  Don’t skip this step, it’s important to know if you’re getting the right vehicle for you before being locked into a contract. It’s better to take your time and test drive the vehicle first and save yourself from an expensive mistake or massive regret later. Driving the car also gives you the opportunity to make sure everything is working properly, and that you feel comfortable behind the wheel. Be aware if there are there any squeaks, knocks or any other noises that might need to be looked at before purchase. It is helpful to inquire if a vehicle inspection has been done, and if it comes with a warranty.

What extra protection might I need?  WWFCU offers Guaranteed Asset Protection (GAP) on all our auto loans. This added protection is minimal in cost and is added right into your monthly payment. If your car is ever totaled and your remaining loan balance is more than what the vehicle is worth, GAP insurance fills in the difference. Mechanical Repair Coverage (MRC) is another great option that is available to you. This can limit your cost of unexpected, covered auto repairs as your vehicle ages. While warranties typically last about 3 years, MRC will protect you for the life of the loan.

Wayne Westland Federal Credit Union is always here to help you get in that driver’s seat. If you need a little help budgeting your income to afford that new car, or if you want to see what finance options are available to you, reach out to our financial coaches today.

Taxes

It’s Tax Season

February 12, 2024

Benjamin Franklin said it best when he proclaimed, “in this world, nothing is certain except death and taxes”. While there is something to be said about paying your fair share, not much takes the sting out of paying taxes. A study by the Pew Research Center in Washington, DC shows that 56% of  Americans have a negative reaction to filing their income taxes. While we may not be able to make the process any more enjoyable, the Financial Gurus have a way to save you money when filing your taxes along with some suggestions on how to make the most of that highly anticipated tax refund!
Save on TurboTax through WWFCU
Did you know that being a WWFCU member qualifies you for a discount on TurboTax? You can save up to 20% on TurboTax federal products as a special offer from us to you! To get started, simply follow these steps:

  1. Go to our website at wwfcu.org.
  2. Hover over the Member Benefits tab.
  3. From there, find Credit Union Discounts.
  4. Select TurboTax from the list.
  5. Review and choose which product works best for you and Get Started!

We are always looking for ways to thank our members for choosing WWFCU as their trusted financial institution, and this is one way that that we can extend a “thank you” while helping you save money at the same time.

Using Your Tax Refund for a Low-Rate Share Pledge
Loan
Are you thinking of possibly using your tax refund to pay off some debts but hate the idea of parting with all that money for good? A share pledge loan might be the solution for you. A share pledge loan is a loan issued using money held in your account as collateral. Share pledge loans typically come with a very low interest rate due to their low-risk nature. How it works: Let’s say your tax refund is $5,000 and you have several credit card bills that you’d like to pay off that total that amount. A share pledge loan places the original tax refund of $5,000 on hold in your account, and then you’re granted a $5,000 loan to use towards paying off those bills. As you pay the loan back, the money on hold is released accordingly. You will get the added benefit of earning interest on the full balance of your savings account even though the funds are being held. Share pledge loan rates are much lower than the average credit card rate, so you will save on interest and get those credit cards paid down sooner. WWFCU is proud to offer our members share pledge loans starting at just 3.00%!

Saving Your Tax Refund for the Future
Saving money always seems to be a goal, but somehow it usually seems to end up on the back burner. Why not let this tax season be the time you finally start working towards that goal. Here at  WWFCU we offer a variety of products to help you make the most of your money. From higher yield money market accounts to share certificates, we have the right product for you to get your savings started. If you are just starting out with a money saving plan, creating an emergency savings account is usually the best place to begin. Financial planners recommended you have on average, 3–6 months of living expenses in your emergency savings. Having these funds set aside can give you peace of mind knowing that you are prepared for life’s unexpected events. Not only will an emergency fund increase your financial security, you’ll also be using your money to make money. While your funds are on deposit in an interest-bearing savings account, you will also be earning dividends on it.

If you have longer term goals in mind, a Share Certificate could be a great option for you. Maybe your auto lease will be up soon, and you want to buy it out at the end of your term. Why not take a  portion of your tax refund and put it in a certificate that earns interest then use it towards a down payment upon maturity? The less you need to finance, the lower your payments will be. Currently, Wayne Westland Federal Credit Union is offering a 12-month CD at 3.03% APY. Did you know you can do a share pledge loan against a Share Certificate too? This can help you accomplish multiple goals at the same time. The Financial Guru Team is here for you! Please contact us at 734-721-5700 with any questions you may have or to schedule an appointment with one of our certified financial counselors. We would love to help you reach your goals in 2024 and beyond.

Financial Wellness

Taking Control of Your Finances

January 23, 2024

 

With 2023 in our rear view mirror, it’s time to kick off 2024 with some new year’s resolutions. Most resolutions can be as simple as working out more, eating healthier, saving money or starting a new hobby. While there are a million resolutions you could make, your WWFCU Financial Gurus have a suggestion for you: learning how to take ownership and control of your finances! Let us help you start taking the necessary steps to make 2024 your year for financial success!

Normalizing Talking About Finances

Discussing one’s finances has long been a sensitive subject and a topic most people try to avoid.  If you find discussing financial matters stressful, awkward or simply taboo you aren’t alone! A 2018 Capital Group survey found that almost everyone would choose to discuss anything, including politics and religion, before discussing money and finances. The Financial Gurus are here to encourage you to break that stigma and normalize talking about your finances. Here are some tips that might help:

  • Look for educational classes or seminars within your community.
    • WWFCU recently hosted a presentation on Financial Wellness at the Westland Public Library. This is a great way to gather information, resources, and engage in group discussions about money matters. Plans are in the works to hold another presentation this Spring, so be on the lookout for a date and time!
  • Try talking to someone you trust regarding your personal finances. Asking for advice from a family member, friend, or a financial counselor is a great way to become comfortable with talking about money matters.
    • WWFCU has four certified financial counselors on staff to professionally assist you in reaching your goals and taking control of your financial health. For more information, give us a call to set up an appointment.

As the old saying goes, money makes the world go round. Everyone wants it and everyone needs it to take care of life’s basic necessities. Most consumers tend to borrow money to make big purchases, so you are not alone in having debt. According to Experian data collected in 2021, the average American holds a debt balance of $96,371. This statistic shows that many people are in the same situation, and no one should feel ashamed of their financial condition.

Paying Off High Interest Credit Cards & Loans

If you find yourself overwhelmed with multiple debts and you’re not sure where to start, we suggest increasing your minimum monthly payment or rolling up your debt. This method is also referred to as “snow balling” your debt.

The first step is to take a hard look at all of your debts, including credit card and installment loans. Determine which one has the highest interest rate and target this loan first. By looking at your monthly expenses and budget, you should have a pretty good idea of what you have left at the end of the month. (The WWFCU Financial Gurus can help you with starting a budget too!).

Let’s say you’ve found an extra $100 a month you can put towards your bills; you will want to apply this extra amount to your minimum monthly payment on the highest interest rate card or loan you have. If you can continue to do this every month it will help you pay the balance off sooner. Once the first debt is paid off, take the additional $100 plus your minimum payment on the paid off debt, and apply that to your next highest interest rate loan/credit card. Try to continue this process until all your debt is paid down.  This technique can help you save significant amounts of interest if you keep up with it every month, which helps you keep more money in your pocket in the long run!

  • Here is an example: You have a credit card with a $2,000 balance with an interest rate of 18% and a minimum monthly payment of $35.00. By paying just the minimum, it would take you 131 months (about 11 years) to pay that balance off and you would be paying $2,574 in interest. By using this snow balling technique, the addition of $100 to that minimum payment every month, you’d have the balance paid off in just 17 months and only pay $278 in interest. That’s a savings of $2,296!  Utilizing a financial calculator is a great tool to help you get these figures. We have a loan payment calculator on our website under products and services that you can use to calculate trade lines.

WWFCU Offers Consolidation Loans

Wayne Westland Federal Credit Union offers consolidation loans, which could be a great solution to help you pay down your debts. A consolidation loan may be a good option for you if:

  • You’re having trouble keeping up with multiple payments/bills and would find it easier to have just one payment each month.
  • The minimum payments on your credit cards don’t seem to be bringing your balance down at all.
  • You have high or varying interest rates.

The benefits of consolidation loans can be priceless.  Consolidation loans can offer set monthly payments, lower interest rates than credit cards and can potentially save you money in the long run. Some other benefits include:

  • Reducing multiple debts into one single monthly payment.
  • Ability to pay off debt earlier due to lower interest rates (Rolling up your payments helps with this also).
  • Potential to lower your monthly payments.
  • Can improve your credit score.
  • If you use collateral (equity in your home, paid off vehicle) you could qualify for an even lower rate and get those debts paid off even sooner.

With consolidation loans it’s critical not to fall back into old spending habits. If you are using a consolidation loan to pay off credit card debt, try not to use those cards moving forward unless absolutely necessary. Only charge what you know you can afford to pay off in full each month. Also, try not to extend the loan term length any longer than necessary. The goal is to get out of debt as quickly as possible, not to prolong it.

The path to better finances starts with changing your habits. Some of these changes will be easier than others, but if you stay committed to this transformation, you’ll end up with great money management skills that will serve you throughout your life – and just think you’ll have more money in your pocket too!

If you need help with creating a budget, debt management, consolidation loans, or other ways to start on your path to financial control in 2024, reach out to WWFCU and the Financial Gurus today. Don’t forget to ask about our consolidation loans and great rates!

Home Banking

New Online and Mobile Banking Platform

January 2, 2024

We are excited to announce that our home banking site and mobile app has been upgraded and refreshed.

New features will include:

  • Touch ID or PIN authentication
  • View balances and account activity
  • Make deposits with a snap of your camera
  • Bill pay and person-to-person payments
  • Transfer funds
  • Personalize your app
  • Branch and ATM locations
  • Chat feature

Read our Online/Mobile Banking FAQs – Click Here

Fraud Protection

Identity Theft

December 11, 2023

Did you know, on average someone becomes a victim of identity theft every two seconds in the United States?

Identity theft occurs when someone uses your Personal Identifiable Information; such as your name, social security number, or birthdate to impersonate you. Identity thieves can use your stolen information to access bank or investment accounts, open new credit cards or loans in your name, have utility services turned on in your name, steal your tax refunds, and even give your information to law enforcement if they get arrested.

Your WWFCU Financial Gurus are here to help you get a better understanding of the different kinds of identity theft and potential warning signs to be on the lookout for. We will also provide you with the necessary steps you should take if you become a victim of identity theft.  Such as information on how and where to report it, and how to protect yourself from being a victim in the future.

The most common types of identity theft include:

  1. Credit Identity Theft. Credit identity theft is when your stolen information is used by criminals to apply for new credit. Some warning signs to look out for include:
    • Changes in your credit score or an account you don’t recognize.
    • Debt collection notices, phone calls, or even judgments against you for unpaid debts.

This is why monitoring your credit report is so very important!  Identifying and reporting discrepancies right away can keep the problem from escalating. The best way to prevent this type of identity theft in the future is to put an alert and/or freeze on your credit report so additional verification methods must be taken before a loan or credit line may be disbursed in your name.

  1. Taxpayer Identity Theft. Taxpayer identity theft is when someone uses your social security number to file a tax return with hopes of stealing your tax refund. Watch out for red flags such as:
    • Not being able to e-file.
    • Notices from the IRS suggesting you worked for an employer who is unknown to you and who you never worked for.

Filing your taxes early is one of the best ways to prevent this from happening to you. By filing early, you beat the criminals to the punch and stop them from stealing your tax return money.

  1. Criminal Identity Theft. Criminal identity theft happens when your information is given to law enforcement by a criminal during an arrest or investigation. Identity thieves may use your stolen information to create fake IDs, such as a driver’s license or state ID card. A warning sign to look out for would be:
    • Receiving court appearance requests for tickets you were not involved in.

The negative effects of this type of identity theft could result in you being detained by a police officer for reasons you know nothing about or being denied a job or promotion due to something found in your background check.

  1. Child Identity Theft / Synthetic Identity Theft. Child/Synthetic identity theft involves stealing a child’s social security number, which is used to create a false identity with a blank slate. Reports show children may be victimized at a rate of between 35 to 51 times higher than adults. This type of crime often goes unnoticed for years, until the child applies for college loans or other credit in their name. Be on the lookout for warning signs including:
    • Receiving credit card offers through the mail for your child.
    • Calls regarding missed payments on a loan or credit card in the child’s name.

It is possible to prevent this happening to your child by shredding all confidential documents, keeping personal information private, or placing alerts and/or freezes on their credit reports.

    • Take advantage of WWFCU’s credit report monitoring products and free soft inquiry credit reports monthly for your child as well as yourself. Click here for more information: FREE Identity Theft Protection (wwfcu.org)
  1. Medical Identity Theft. Medical identity theft is when someone uses your medical benefits to get health care services. This is a potentially dangerous type of identity theft because it mixes your medical history with that of the criminal and could affect health care decisions made by your doctor. Warning signs include:
    • Claims or payments on your Explanation of Benefits you don’t recognize.
    • Bills for services you didn’t receive.
    • Changes to your deductibles and/or co-insurance payments.

If you have been a victim of medical identity theft, contact your insurance company and healthcare provider to ensure all your medical information is correct and dispute any services you did not authorize.

  1. Account Takeover. Account Takeover happens when cybercriminals use stolen information to hijack your online accounts. Once they have access, they can change your login info to lock you out, withdraw funds, make purchases, or extract information they can sell or use to access other accounts. Popular targets of account takeover include:
    • Online bank or credit card accounts.
    • Social media or email accounts.
    • Online shopping accounts.

To protect yourself from account takeover:

    • Create good password habits – use strong and unique passwords for each online account; avoid using common words or characters, recycled passwords, and previously exposed passwords. Try using a password manager to generate and/or store your passwords.
    • Use Multifactor Authentication (MFA) – when available, take advantage of setting up security questions, enabling one-time verification codes sent via text or email, using biometrics such as fingerprints or face recognition, and/or using authentication apps such as Google Authenticator or Microsoft Authenticator.
    • Pay attention to notifications and alerts – if you receive text messages, emails, or phone calls about account changes you did not initiate (such as changes to your password, email, address, phone number, etc.), investigate it right away.
    • Monitor your account activity regularly – look for changes or transactions you don’t recognize and report any suspicious activity to the company or agency involved so they can secure your account immediately.
    • Consider obtaining identity theft protection – get help monitoring your identity, accounts, and credit file.

There are a few additional steps you can take to help prevent identity theft:

  • Secure your social security number and never carry it in your wallet or purse.
  • Properly dispose of any documents that contain personal information. WWFCU offers free, secure shredding services for all our members. Just stop into our branch with your documents.
  • Be on the lookout for phishing and spoofing scams. Never click on text or email links you don’t recognize, never give out your personal information or login information to someone contacting you about a supposed account problem. If you receive a call from someone asking for sensitive information claiming they are from a company or agency, hang up! Instead, look up the company phone number for yourself, and call them to confirm the supposed “problem” is legitimate.

If you become a victim of identity theft, you will want to contact:

  • All your financial institutions.
  • The Federal Trade Commission to file an Identity Theft Affidavit – 1-877-438-4338 or identitytheft.gov
  • The three credit bureaus to set a credit alert or freeze:
    • Experian – 888-397-3742 or experian.com
    • Equifax – 888-378-4329 or equifax.com
    • Transunion – 800-680-7289 or transunion.com
  • The IRS if you suspect tax theft – 800-908-4490

What is identity theft protection, and should you use it?

Identity theft protection is a type of insurance policy that provides financial protection for victims of identity theft. The main features of identity theft protection fall under these three categories:

  • Credit Monitoring
    • Alerts you via text or email to any changes on your credit report.
  • Identity & Account Monitoring
    • Scans the dark web or other websites for your personal information.
  • Recovery Assistance
    • A certified and licensed Recovery Advocate provides personalized one-on-one service to help with replacing lost IDs and account cards.
    • Pays for related recovery costs.
    • Can cover up to three generations of your family.

WWFCU offers FREE identity theft protection insurance with continuous credit monitoring as a benefit of opening a Visa credit card with us.  This is an estimated savings of $12.95 a month. Apply for a WWFCU Visa credit card here: Loan Application (wwfcu.org)

Alternatively, you can purchase your own identity theft protection package by visiting the following website: Identity Theft Solutions (merchantsinfo.com)

If you would like more information on this or any other financial topic, feel free to contact us at 734-721-5700.

Sincerely,

Your Financial Gurus

 

Fraud Protection

Common Scams & How to Protect Yourself

November 14, 2023

It’s the most wonderful time of the year! The busy holiday season is now upon us, or as your WWFCU Financial Gurus refer to it, “The Scam Season!”

With Christmas festivities in full swing, and everyone busy deciding which presents to buy, the scammers are hard at work. They are constantly learning new techniques and tricks to get as much money from their victims as possible. Unfortunately, here at WWFCU we are no strangers to seeing the handiwork of fraudsters and scammers. As a member, if you happen to be a victim of a scam, just know our number one priority is helping you fully recover from it. You can rest assured knowing your financial gurus have tips on how to spot a scam and what to do if you find yourself a victim.

One of the biggest scams around is known as the “romance” scam. In today’s digital age a lot of us turn to social media or online dating apps to meet new people. This is a scammer’s paradise. By creating fake profiles, the scammers can easily connect with you and build a relationship. These relationships tend to progress very quickly from occasional messages, to requests to contact you outside of the app or social media platform. Yet, despite many attempts to contact you using various methods, the scammers will always have an excuse about why they can’t meet you in person. Popular excuses are they work out of the country, they’re in the military, or maybe even working on an oil rig somewhere. Once these con artists know you are invested in the relationship, that’s when the requests for money begin. They might claim they need help paying a medical bill either for themselves or a family member, money for a plane ticket to see you, even money to help them secure a Visa to live in the United States.

All scammers, not just romance scammers, want your money, and they want it quickly. Scammers often request money in a way that is difficult to get back such as through a wire transfer, cryptocurrency, or their absolute favorite form of payment… gift cards. In 2021, the Federal Trade Commission reported an estimated loss of $547 million dollars due to romance scams.

If you find yourself in a situation like this, here are a few tips on how to avoid losing your hard-earned money to these scammers.

  • Stop communicating with this person at once
  • Talk to someone you trust and ask their advice on the situation
  • Research common scams using an internet search engine for more information and other helpful tips. Some examples to search for are “Romance scam”, “Army scammer” and “Oil Rig Scam” all of which will give you a ton of information
  • Most importantly do not send any money, gift cards, or give out your account information

If you happen to have fallen victim to a scam, you are not alone. Did you know that 1 in 3 adults said they or someone they know had been asked at some point to pay a bill or claim a prize by buying gift cards? This is referred to as the “Gift Card Scam”. In 2021, AARP reported nearly 100 million dollars in losses due to this scam. Keep in mind that no legitimate business or government agency will ever demand you make a payment using a gift card. Scammers love gift cards because they are readily available, nearly untraceable, and are easily converted to cash.

Gift card scams are usually started with a phone call, text message, or through social media. These requests are always urgent, and they will say almost anything to get you to buy gift cards. They will often tell you what specific cards to buy like Apple, Google, eBay, Walmart or Target just to name a few. They may even tell you to go to multiple stores and buy cards, so the cashiers don’t get suspicious. The scammer will ask you to give them the card number and pin or take a picture of the card information to send to them. All these types of requests are very suspicious, and the workings of a scammer. Here’s a list of the most common gift card scams:

  • Government agency scam. Scammers will say they’re from the social security Administration, IRS or other government agencies. They will demand payment right away and even threaten severe consequences if you fail to pay. Take it from us, no legitimate government agency will contact you demanding an immediate payment or prefer a gift card as the payment type.
  • Tech support scam. You receive a call from someone claiming there’s a problem with your computer or device. They may claim to work with Microsoft, Apple, or Google. The scammer will ask for remote access to your device and demand payment to get your device fixed. This is a scam. You should never give anyone access to your computer as it stores sensitive data about you and sometimes your close family members.
  • You’ve won a prize or lottery scam. Scammers say you’ve won a prize or a lottery, but before you can receive your prize you must pay taxes on the item or shipping and handling fees. Again, they will most likely request payment with a gift card. Ask yourself, “Did you enter to win this prize? Did you enter a lottery drawing at all?” If the answer is no, you are surely being scammed.
  • Check scam. Scammers may send you a large check to deposit because they don’t have their own account or can’t access their own account for some reason. The scammer will tell you that you can keep a part of the money, but you must send them the difference in the form of a gift card. The check is fraudulent, and if you negotiate it, you will be held responsible for paying back any money taken from that check. If you are ever in doubt about a fraudulent check, please reach out to us. Your Financial Gurus can teach you how to spot the signs of a fraudulent check.
  • Work From Home Scam – As remote jobs have become very popular; scammers have taken full advantage by using these types of scams to obtain personal and confidential information. Some common work from home scams are mystery shopper jobs, medical billing, and personal assistant jobs. The scammer offers the job through the internet or other means, and through the “hiring” process, the scammer obtains all your personal information and potentially any assets you may have. Here are some steps to figure out if a work from home job is a scam:
    • The job is too good to be true.
    • There is little to no information on the company.
    • There are warnings about it online.
    • The employer is very eager to hire.
    • You must pay to work.
    • The potential employer communicates poorly.

As scammers get bolder and more creative, a new scam is becoming more popular. The “Home Banking Scam”. The scammer will call you and let you know that you have been approved for a loan. However, this loan will require your online banking username and password so the funds can be directly deposited into your account. Once the scammer gets your information, they now have control of your account. The first thing the scammer will do is change your password blocking you from any online access. This may result in money being taken from your account that you did not authorize and could potentially create a serious financial hardship. A financial institution or lender will never call you saying you’ve been approved for a loan that you hadn’t applied for. The best advice we can give you to avoid falling for this scam is never give out your login information to anyone, even people close to you.

Please feel free to contact us if you find yourself in a situation that you’re feeling uneasy about, or if you would like more information about scams like these. At Wayne Westland Federal Credit Union, we have a variety of services to offer you including Identify Theft Insurance and Credit Report Monitoring. We can also help dispute fraudulent charges on your account, help you put alerts on your credit report, and get you started on the path to financial recovery. As the old saying goes, if it’s too good to be true, it probably is! Give us a call to set up an appointment with one of our Certified Financial Counselors today. As always, we are working toward your financial success!

Sincerely,

Your Financial Gurus

Financial Wellness Tips

5 Tips for Improving Your Credit Score

October 11, 2023

It’s not uncommon to feel nervous or even a little apprehensive when applying for credit. Most of us agree that it’s not an easy topic to talk about, but did you know that 37% of us have a credit score of 700 or lower? That’s over one-third of consumers! If you happen to fall into that category, your WWFCU (Wayne Westland Federal Credit Union) financial gurus want you to know that you are not alone and that we’re here to help!

Here are 5 tips for improving your credit:

1.) On-Time Payments. Perhaps the best way to improve your credit is by making your payments on time. Not only does it show current and potential lenders your ability to pay back debts within the agreed terms, but it is also the largest scoring factor on the FICO and Vantage Score credit scoring systems, accounting for roughly 35% of your scores makeup.

A helpful hint to keep you on schedule and move you towards an improved credit score is to set up automatic payments. This is a great tool for someone who is always on the go. If automatic payments don’t fit your lifestyle, calendar reminders are another way to stay on top of your payment schedule and avoid late payments.

Sometimes it’s difficult to make a large payment and that’s ok, try splitting up your payments. For example, if you get paid on a weekly or bi-weekly basis, make small payments towards the balance every payday. Making more than your minimum payment is also a great idea, as that will help get the balance paid down faster and save you on interest charges over the long run.

2.) Credit Capacity. This is the second biggest factor in determining your credit score. Your credit capacity is based on the total amount of credit that has been granted to you versus the current balance of credit owed. For example, if you have a credit card with a $10,000 limit with an outstanding balance of $9,000, you are using 90% of your credit capacity.

The best rule of thumb is, never spend more than 30% of your available credit limits. If you can do this, it will improve your credit score and help your chances of securing a lower interest rate on future credit. One possible solution to remedy a high credit capacity is to try requesting a credit limit increase. By having a higher credit limit while keeping a low balance, this will show your ability to use credit wisely. Another option when trying to keep your overall credit usage low is paying down balances before the end of the billing cycle.

3.) Credit Mix. Another factor that makes up your credit score is the type of debt on your credit report. Having a good credit mix is beneficial to your overall score. An ideal credit mix includes a blend of revolving vs installment loans. For instance, having at least 1-2 credit cards or lines of credit, a secured loan such as an auto or mortgage, and an unsecured personal loan is highly beneficial.

Another way to add variety to your credit is by self-reporting any liabilities that aren’t already showing on your credit report. Reporting payments such as your phone, gas or electric bill can give you a boost to your credit score and show good payment history. Just use caution when you are trying to obtain new tradelines to add to your report, and don’t add too much at once or in a brief period. Adding too many new credit accounts to your report will have adverse effects.

4.) Dealing With Collection Accounts. Having an account in collections or a charge off status has a significantly negative impact on your credit score and can stay on a report for up to 7 years. However, there are solutions to overcome these derogatory tradelines and get your credit back on track. Most collection agencies are willing to set up payment arrangements or agree to settlements. Paying off collection accounts will help your credit and show potential lenders that you are responsible and trustworthy.

Not only does satisfying these debts help improve your credit, but it will prevent any further collection action due to those debts. Collection agencies may receive a judgment against you, which allows them to garnish your wages, bank account and potentially seize personal property. If you do find yourself in a situation like this, WWFCU’S financial counselors are here to help you.

5.) Checking Your Credit Report. Monitoring your credit report regularly to look for any missing or incorrect information is vital. Wayne Westland Federal Credit Union offers free credit reports to our members on the last Friday of every month. These reports are a soft inquiry and won’t affect your credit score or be listed as a credit inquiry.

This report is used as an educational tool and resource for checking in on your credit accounts. Feel free to stop in and see one of our Member Service Representatives who will supply your free report and answer any questions you may have. Our financial counselors are also always available to give sound credit advice and help you start or continue your credit journey.

Wayne Westland Federal Credit Union has many solutions available to help you improve your credit. If you are just beginning to build your credit, we have various loan products designed to help you. We offer low limit Visa credit cards, small balance personal loans and other options that can help you in building credit and a good payment history. Give us a call today to start your path to financial success!

Sincerely,

The Financial Gurus

Financial Wellness

Understanding Your Credit Score

September 5, 2023

What is a credit score?

Credit Scores are a number given to express your creditworthiness and how you’ve managed credit and debt. Understanding how they work can help you improve your credit history, qualify for lower interest rates and more. To better understand your credit score here are a few things you need to know. Your score is a crucial indicator of the health of your credit history. Most popular scoring models use a range of 300 to 850.

The three bureaus.

· Experian – website: www.experian.com

· Equifax – website: www.equifax.com

· Transunion – website: www.transunion.com

You may be able to obtain free full credit report from each bureau per their terms and conditions. Credit Karma offers Equifax and Transunion Vantage scores for free with monthly updates.

 

Factors affecting your score:

Good pay history makes up 35% of your FICO score. One missed payment may result in a drop of 10% to 35% on your score and may have a negative impact for up to seven years.

Amounts owed (capacity) is the total amount of debt you have, and it makes up 30% of your FICO score.

Length of credit history makes up 15% of your FICO score and is the average age of all your account.

New credit makes up 10% of your FICO score. New credit is considered the amount of new credit opened recently and any hard inquiries in the last two years.

Credit mix or types of credit you have makes up 10% of your FICO score.

Credit mix considers how well you can manage a diverse credit file meaning a healthy mix of revolving and installment loans. It is always a good idea to regularly track and monitor your credit report, not only to track your progress but identify any potential issues that may arise.

FICO vs Vantage score:

The two most used scoring models are FICO and Vantage. FICO is used by 90% of top lenders and creates specialized versions of its scoring models for auto lender and credit card companies. Vantage Score is found on Credit Karma and does not show your Experian report only Equifax and Transunion. Credit scores can vary depending on the scoring model used by FICO, Vantage score, and what information is being reported to each bureau.

Wayne Westland Federal Credit Union offers free credit reports on the last Friday of every month, identity theft protection, credit monitoring and financial counseling to help you better understand your credit score and credit report. Please contact us today to help take the first step towards your financial well being.

Sincerely,

Your Financial Gurus

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