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Fin ed opportunity: Show members how to improve credit scores
MADISON, Wis. (1/29/13)--Many U.S. consumers want to improve their credit scores, but don't know how, according to a new survey. That's where credit unions can help. Some credit unions are making the most of this opportunity to educate their members.

Most respondents--83%--in a freecreditscore.com survey have checked their credit scores; however, nearly half (42%) want to improve credit scores but don't know how.

Other survey findings provide insights into credit awareness and credit usage. Sixty-five percent of respondents indicated that they consider their credit score when engaging in credit-related activities such as maxing out a card, applying for a new card or skipping a payment. Women (68%) are more likely than men (61%) to consider their credit score before making credit usage decisions.

How are credit unions helping? Some offer workshops. Cessna Employees CU, Wichita, Kan., is offering a free Credit Enhancement seminar tonight. After the seminar, credit union loan officers will provide one-on-one counseling to help members assess their individual credit reports.

University of Virginia CU will educate members with an Understanding Credit and Credit Scores seminar on April 9. The credit union presents the seminar regularly, Glenn Birch, Virginia CU's public and media relations director, told News Now.

"Members are not always clear on how their scores are compiled," said Birch. "We point out the all the factors they should be aware of."

A consumer's credit score based on five factors, according to Fair Isaac Corp., the company that compiles credit scores. The factors include:

  • Payment history (35% of score);
  • Amounts owed (30%)
  • Length of credit history (15%);
  • New credit (10%); and
  • Types of credit (10%).
Richmond, Va.-based Virginia CU also partners with Balance, a financial assistance counseling service that can help members improve their credit scores, and offers credit score information on its web site.

UW CU, Madison, Wis., offers My Credit Score, for members with access to their credit scores through its online banking platform. My Credit Score allows members to track changes in their credit scores and view a customized in-depth analysis of their credit picture.

UW CU offers My Credit Score through Credit Karma, a provider of consumer credit score services.
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