Dupaco Community Credit Union is offering personal credit history lessons to help consumers drive up their credit scores and save money.
"As a credit union, Dupaco was founded on the principle of promoting thrift," said Bob Hoefer, DCCU CEO. "That means it's our job to help our members cut costs, build savings and improve their overall financial well-being. And that's exactly what credit score education is all about."
The free, one-on-one sessions with a CU loan officer will include information on how a credit score is devised, what it means and what consumers can do to improve theirs.
"Recent surveys have shown that as few as 10% of Americans know their credit score with even fewer truly understanding the tremendous impact this score can have on their everyday lives," Hoefer said.
These private sessions will outline five key components that make up a credit score, suggest ways for consumers to avoid bad ratings and provide confidential coaching. Hoefer said he expects the program will save consumers money in finance charges.
Among the recommendations: "Pay your bills on time," advised Matt Dodds, DCCU Senior VP, Consumer Lending.
In preparation for the sessions, the CU hired Rex Johnson of Lending Solutions, Inc., Elgin, Ill., to conduct a two-day training seminar for staff on credit reports and credit scores.
"We wanted to make sure we have everybody on the same page so the message was consistent," Dodds said. "Having a low score can literally cost someone thousands in additional finance charges. And with credit scores being used more and more, it's possible that a person with a low score could be denied for more than just a loan."
Dodds said changes in recent years on how credit scores are used and by whom make it even more important that people understand what their numbers mean.
"Historically, credit scores were used mainly by lenders to make credit decisions and charge rates," he said. "In recent years, however, many others such as insurers, utilities (providers) and employers have begun using credit scores in their decision-making process."
To be honest, Dodds said, the credit scoring models "are like the recipe to Coke. It's a product they sell to financial institutions and it works."
Based on their experience using credit scoring "every single day with business loans, mortgages and credit reports on people we hire," Dodds said, CU experts can pass along some valuable tips to help consumers pay less on their loans, thus, have more money in their saving accounts.
The $340-million Dupaco is using radio, billboards and statement stuffers to make consumers aware of the ongoing, free service. And, in addition to the one-on-one consultations, the CU is offering a general seminar to discuss credit scoring in general terms.
