By Staff Sgt. Robert Cloys
50th Space Wing Public Affairs
Ent Federal Credit Union, in partnership with the Airman and Family Readiness Center, will be hosting a free Secrets of the Credit Score class Aug. 28.
Although the class has had multiple variations throughout the years, the content and focus remains the same, to find out how the elusive credit score is derived, said Candie Dunow, Ent senior underwriting specialist.
Topics include how a credit score is determined by credit reporting agencies, how to ensure credit is being reported correctly, how to dispute incorrect reporting, how to clear up derogatory credit and how to establish good credit, maintain and monitor it.
“Understanding how credit bureaus work is very important in this day and age since so many things we need and use are based off of our credit score,” said Dunow. “No longer is your credit just used for purchases, such as auto loans or mortgage loans, but it also has an effect on whether or not companies will approve a service at a decent monthly payment, or at all, such as insurance premiums, cell phone service, utilities and [rent]. Even employers review credit as a basis of employment.”
The class is designed for every level of credit.
“Whether you have no credit, limited credit, derogatory credit or perfect credit, it is helpful for many to understand how their credit score is derived and how to improve or structure credit to ensure future approvals and low rates by all the sources that use credit as a main factor to extend loans or services,” said Dunow.
However, improving or maintaining a high credit score doesn’t rely on just one factor.
“It’s important for military members to understand their credit scores because the higher the credit score, the lower the interest rate,” said Elizabeth Archuleta, community readiness consultant here. “There are two types of credit scores, Fico and Vantage. Fico is still the one used by most reporting agencies. The scores are based on paying on time, paying at least the minimum due, not maxing out credit cards, length of time credit card has been opened, to name a few. Basically, it gives the lender an idea of your ability to pay back the debt.”
To fully understand how credit scores work, Dunow emphasized that getting the facts straight behind some common credit myths is vital.
“Many people believe that a credit score is made up of not only paying your loans on time, but also closing out older credit cards that aren’t used or get paid off,” she said. “Closing older accounts even though they aren’t being used is actually a negative effect on credit because once they are closed it eliminates an established positive trade line with credit availability. Credit availability and time established has an impact of 30 percent on how your credit score is calculated.”
The class will also show attendees how to access their credit score for free.
To sign up for the Secrets of the Credit Score, or to get information about other upcoming financial classes, contact the Airman and Family Readiness Center at 567-3920.