Help Consumers Improve Their Financial Wellness and Get Organized to Buy a Home in 2024

Mortgage experts have provided advice and content to attract and educate renters and prospective first-time homebuyers on ways to improve their financial wellness and get organized to buy a home this year.

Leveraging Financial Wellness Content to Build Your Community
Brian Vieaux, President & COO, FinLocker

Beyond Budgeting – Look to Do This in ’24 To Get Ahead
Dustin Owen, Founder & Host of The Loan Officer Podcast

Transforming Home Buying Through Financial Wellness Conversations
Sue Buswell, Credit and Score Consultant #sueknowsthescore

Preparing Past Clients to Get Organized for a Refinance in 2024
Brian Vieaux, President & COO, FinLocker

Which New Year’s Resolution will you keep?
Steve Ely, CEO of eCredable

Empowering Financial Wellness: A Loan Officer’s Guide to Educating Consumers
Ginger Bell, Founder & CEO, Edumarketing

Jump for Joy
Paul Gigliotti, COO & Executive Board Member of Axis 360 Lift

Crafting Video Content to Guide First-Time Homebuyers in 2024
Mike Faraci, CEO & Founder of Red Button Media

Unlocking Financial Wellness with Ongoing Mortgage Approvals
Jeremy Potter, President of titleLOOK

Breaking Barriers: How Down Payment Programs Bridge the Affordability Gap
Rob Chrane, CEO & Founder of Down Payment Resource

Help Consumers Build Their Credit Profile
Sue Buswell, Credit and Score Consultant #sueknowsthescore

View all previous articles

Leveraging Financial Wellness Content to Build Your Community

Brian Vieaux, President & COO, FinLocker

January is #FinancialWellnessMonth, which provides loan officers with an opportunity to truly provide value and connect with the people in your community and your existing database of clients and prospects.

Remember the personal branding advice shared by FinTalk contributors last month? If you’ve been implementing those strategies, you’re well on your way to becoming a beacon of financial education and trust in your community. Setting yourself apart from other loan officers as a trusted advisor rather than just an order taker is a game-changer.

So, how do you spread the word? It’s simple—start creating content that supports financial wellness by leveraging your expertise. You’ve got a wealth of knowledge about mortgages and everything related. Break down the different elements that go into qualifying for a mortgage—things like credit, assets, debt-to-income ratio, and what constitutes stable employment income—and turn these components into engaging content.

Use your expertise to craft content that resonates with your audience. You already have the know-how; now, it’s about presenting it in engaging ways. Share financial tips, insights, and stories of how you’ve helped other customers qualify for a mortgage to position you as the go-to expert in all aspects of financial wellness as it relates to getting a mortgage.

Think about it this way: you’re not just offering a mortgage but providing guidance and support through valuable, educational content. This approach not only helps your audience but also establishes you as a trusted partner in their financial journey.

Whether it’s through social media posts, videos, blogs or even interactive homebuyer webinars, let your knowledge shine and show your audience that you’re passionate about empowering them with the information they need to make informed financial decisions.

By creating valuable, engaging, and personable content, you’re not just informing your audience—you’re building lasting connections and establishing yourself as a trusted advisor. And that’s a win-win for both you and your community!

Beyond Budgeting – Look to Do This in ’24 To Get Ahead

Dustin Owen, Host of The Loan Officer Podcast

In the intricate dance of adulting, financial balance often takes center stage. We’re told to budget diligently, cut excess spending, and squirrel away our hard-earned dollars. And while those practices are undoubtedly crucial, what if I told you there’s a better approach to financial empowerment? Brace yourselves. It’s time to flip the script and focus on earning more.

Now, before you raise an eyebrow, let’s acknowledge the importance of budgets. Yes, tracking expenses and trimming the fat are essential components of financial success, like the kale in your smoothie. But, if you focus on earning, you’ll be amazed at how much easier the first two become. Here are three ways to increase your income:

Negotiate a Raise:
If you find yourself feeling stuck in the professional trenches, perhaps it’s time to don your negotiation armor and step onto the battlefield of salary discussions. Many employees hesitate to broach the subject, fearing it might be seen as audacious. Newsflash: it’s not audacious; it’s strategic. The answer by be “no” but don’t leave that meeting without knowing what is required to earn more.

Freelance:
In the gig economy, opportunities abound for the industrious soul. Consider freelancing as your financial sidekick. Whether you’re a wordsmith, graphic guru, or coding connoisseur, there’s a platform out there eagerly waiting for your skills. The beauty of freelancing lies in its flexibility. Moonlighting as a freelancer not only injects extra moolah into your bank account but also affords you the chance to explore your passions.

Take Up a Side Hustle:
Think of your main job as the headliner at a concert, and your side hustle as the surprise guest that steals the show. Side hustles come in various forms – from selling handmade crafts on Etsy to driving for a rideshare service. Personally, my favorite three were always valet cars, bartend or manual labor on the weekends.

Now, let’s address the elephant in the room – the time factor. Yes, your schedule is probably as tight as your grandma’s grip on her secret apple pie recipe. But you’ll be amazed at how much time you do have once you get intentional with how you spend it.

While budgeting is undeniably important, it’s time to shift our focus from mere financial survival to thriving through increased earnings. Negotiate that salary, embrace freelancing, and start a side hustle. Remember, the journey to financial success is not just about counting pennies; it’s about making them – lots of them. And the best news is, most of what you need to do is temporary until you achieve that milestone you are using as your navigational beacon.

Transforming Home Buying Through Financial Wellness Conversations

Sue Buswell, Credit Consultant #sueknowsthescore

Happy National Financial Wellness Month!
2023 is in the rear view, and it is time to #soarin24.

One of the best ways to lift your business is to help others – in this case, your potential home buyers looking for an opportunity to become homeowners.

The first step for most Loan Advisors is to pull their borrowers credit report. I challenge that first step, and ask that you start with a conversation. Not just your standard do you know your credit score conversation, but one that humanizes the process and takes the fear out of that credit pull.

Let your home buyers know that your purpose is to guide them through this journey of homeownership, from helping them understand where they are now with their credit goals, to how their current and future credit changes will impact their overall financial wellness.

Start instead with understanding.
• What is their motivator for homeownership? Understanding the WHY will set the tone for the how.
• How have they prepared to make it a reality? Income, budget, debt to income, credit, etc.
• Do they intend to raise their family, or is this just a stepping stone in their financial goals? Wealth building and cost of homeownership, time to recoup costs and more should be discussed here.

January’s also Get Organized Month, and helping your home buyers organize their goals, needs, and wants is just as important as having them gather essential documents needed for those next steps in the process.
Once all are in agreement of the goal of the home search and purchase, pulling the credit report and reviewing any necessary updates becomes a part of the journey. There is a plan in place, an understanding of the goal, and agreements to partner on making it a reality.

Remember, financial wellness comes from understanding where the home buyer is and what their goals are. Homeownership with financial wellness is a journey, not a destination. Let’s empower each other to make 2024 a year of financial triumphs and fulfilling dreams.

Preparing Past Clients to Get Organized for a Refinance in 2024

Brian Vieaux, President & COO, FinLocker

January is also known as “Get Organized Month,” and while many associate it with tidying up physical spaces, it’s also an ideal time to focus on financial organization, especially given the current market conditions.

We exited 2023 with the Feds signaling potential rate cuts in 2024. Given where rates were for most of 2023, many consumers who bought a home in 2023 will be in the market for a refinance at some point this year. As a mortgage advisor, this presents a valuable opportunity to assist your past clients in organizing their finances so they’ll be ready when rates swing in 2024.

Don’t assume that someone will qualify for a refinance just because someone secured a mortgage 6-10 months ago. Without regular check-ins or semi-annual mortgage reviews, you might be unaware of any changes in their financial situation, such as maxing out credit cards for new furniture or appliances in their home.

Utilize available tools to streamline this process. One of the tools that I’m partial to is the FinLocker financial fitness app. If you’re using FinLocker, check that your clients are monitoring their credit and have set up their financial accounts so they can also see their debt-to-income ratio. They can also store all necessary financial documents within this platform to expedite future mortgage applications.

When a refinance opportunity arises due to dropping rates, having their financial information readily available through the app will simplify and hasten the process. Additionally, it positions you as their go-to advisor by notifying them promptly about potential opportunities to lower their payments or rates.

Being organized not only ensures they’re prepared to capitalize on favorable rate drops but also enables swift action, as these opportunities can arise and vanish swiftly.

Educate consumers on the significance of financial organization this January. Stress the importance of reviewing their financial information and having it easily accessible to capitalize on potential rate drops in 2024, setting them up for success in seizing these favorable opportunities.

Empower your clients with financial knowledge and digital tools that pave the way for financial preparedness, showcasing your commitment to their long-term financial well-being. This proactive approach strengthens your relationship with past clients and positions you as a trusted advisor ready to assist them in navigating the ever-changing landscape of mortgage rates.

Which New Year’s Resolution will you keep?

Steve Ely, CEO of eCredable

Each year Fidelity Investments fields a study to ask people (over the age of 18) what their New Year’s Resolutions are for the coming year.

41% wanted to save more money

38% wanted to pay down debt

30% wanted to spend less money

These results don’t change much year over year, which isn’t surprising. All three of these resolutions make financial sense but given 7 out of 10 Americans live paycheck-to-paycheck, it’s not likely most people will be able to get through the year and declare a success for all three.

Plan of attack – There’s only two ways to save more money: make more and/or spend less.  I can’t help you with making more money other than to suggest you ask for a raise, find a better paying job, or add a side hustle to your current income – but you already knew that. But spending less can be achieved in two ways. The first is by actually spending less and part of that is doing the little things like clipping coupons, eating out less, or avoiding that expensive coffee on the way to work. The second, and perhaps more important, is to make the money you have go farther.

Making your money go farther – One important way you can make your money go farther is to improve your credit score. While everyone should strive to live within their means, there are times where people must borrow to handle life’s little emergencies. That is where your credit score becomes important. Your credit score is the key to the terms you’ll pay for loans and with credit cards you already have, or intend to apply for.

Our company is focused on helping people build better credit scores. Why is this so important? Because your credit score is an essential component of how you use your hard-earned cash to impact these three areas of your daily financial life. The key is to better understand the role your credit score plays and how to think about your credit score.

The cost of funds – This is a term that people who lend money use every day, and you should use every day too. A lender has a sophisticated formula they use to understand how much it costs them to acquire the capital necessary to offer you loans or lines of credit. You should think about the cost of funds in relation to the interest rate you’ll pay on a car loan or personal loan. This also applies to credit cards, where the rate offered to you by the issuer is highly dependent on your credit score. If you have a credit card with a balance of $2,500 on the card and you have an Annual Percentage Rate (APR) of 29.99%, the issuer will charge you $62.36 this month. If you have an APR of 16.99%, the issuer will charge you $35.15 this month. That’s only $27.21 per month difference, but every little bit adds up over the course of a year. People with a credit score of 740 or higher will likely qualify for the card with the lowest interest rate. People with a credit score below 640 will likely qualify for the card with the highest interest rate.

Where to start? – Paying more interest reduces the amount of money you can apply towards “saving more money”. “Spending less money” allows you to “pay down debt” which in turn reduces your balances due on loans and credit cards. If you can reduce the balances due on your credit cards, you can lower your utilization rate which makes up 30% of your credit score calculation. This increases your credit score, which allows you to renegotiate the current APR you are paying on credit cards or stop using those cards and apply for a new one with a lower rate. Now you can eliminate more expenses going towards payments, which gives you more money to add to your “save your money” resolution!

Empowering Financial Wellness: A Loan Officer’s Guide to Educating Consumers

Ginger Bell, CEO & Founder, Edumarketing

As we embrace the spirit of Financial Wellness Month, it’s a pivotal moment for loan officers to reflect on their role in fostering financial literacy and empowerment among consumers. In an era where financial complexities are ever-growing, your position as a trusted advisor is more crucial than ever. Here’s a comprehensive guide, fashioned into a practical list, to help you stand out as a beacon of financial wisdom and guidance.

1. Host Educational Workshops and Seminars Organize workshops and seminars on key financial topics like budgeting, debt management, and understanding credit scores. These events can be held in person or via webinars, making them accessible to a broader audience. By providing these educational resources, you position yourself not just as a loan officer, but as a financial educator and advocate.
2. Develop and Share Informative Content Create and distribute easy-to-understand content like infographics, blog posts, and newsletters. These should cover various aspects of financial wellness, such as the importance of saving, the basics of investing, and tips for mortgage planning. Your content can serve as a valuable resource for clients seeking to improve their financial literacy.
3. Offer Personalized Financial Health Check-ups Provide one-on-one consultations to assess individual financial health. Use these sessions to review credit reports, discuss financial goals, and offer tailored advice. This personalized approach not only helps clients but also builds a deeper, trust-based relationship with them.
4. Leverage Social Media for Financial Education Utilize social media platforms to share financial tips, news, and updates. Create interactive content like polls or Q&A sessions to engage with your audience. This approach helps in reaching a younger demographic and positions you as a modern, tech-savvy financial advisor.
5. Collaborate with Local Organizations and Schools Partner with community organizations and schools to offer financial literacy programs. This collaboration not only expands your reach but also demonstrates your commitment to community development and social responsibility.
6. Encourage and Facilitate Savings and Investment Educate clients on the importance of building an emergency fund, saving for retirement, and the basics of investment. Offer resources and tools that can help them start on these paths, such as links to savings accounts or investment platforms.
7. Stay Informed and Educate on Current Financial Trends Keep yourself updated on the latest financial trends and regulations. Share this knowledge with your clients, helping them understand how these trends might impact their financial decisions.
8. Create a Supportive Financial Network Build a network of financial professionals like financial planners, accountants, and tax advisors. Refer clients to these experts when necessary, ensuring they receive comprehensive financial advice.
9. Provide Guidance on Debt Management and Consolidation Educate clients on managing and consolidating debt. Offer insights on how to prioritize debts, negotiate with creditors, and understand the implications of different types of loans.
10. Celebrate Client Successes and Milestones Acknowledge and celebrate when clients reach financial milestones. This not only encourages them but also reinforces the positive impact of your guidance.

By implementing these strategies, you’ll not only enhance your value as a loan officer but also play a significant role in promoting financial wellness in your community. Remember, your role extends beyond mere transactions; it’s about empowering individuals to make informed and confident financial decisions. Let’s make Financial Wellness Month a starting point for a year-round commitment to financial education and empowerment.

Jump for Joy

Paul Gigliotti, COO & Executive Board Member of Axis Lending Academy

Wellness- An important word that applies to all aspects of our lives, I often speak about a whole-self approach and in that conversation, wellness ensures a holistic whole-self approach.

Financial wellness is an important aspect of overall health, happiness, wellbeing, and a strong proponent of general joy. I do not mean that money can buy happiness, but being attuned to your own financial wellness can provide freedom, allowing you the ability to enjoy all that you want to enjoy.

Financial stress can have a significant impact on physical and mental health and wellbeing there by affecting other aspects of your life, including your social life, how you are as a partner or spouse, your ability to parent or mentor and obviously your professional life.

There are multiple elements of financial wellness including:

Financial management, which includes creating and sticking to a budget, reducing debt, and saving for short-term and long-term goals.

Financial security is all about building an emergency fund, protecting against risks through insurance, and planning for retirement. 

Financial literacy is understanding financial concepts, such as interest rates, investments, and taxes, to make informed decisions.

Financial mindset means the developing of healthy attitudes and behaviors towards money, such as avoiding overspending or financial dependence on others.

Financial planning is close to financial management, but different in that it’s about creating financial goals and plans to achieve those goals.

Financial well-being is when you achieve a sense of security, freedom, and confidence, enabling you to focus on other areas of your life without financial stress. In this element I find the most impactful word is Freedom.

All of these elements are essential but to someone just starting on the journey of financial wellness all 6 of these elements might be overwhelming. I recommend breaking down these elements and begin by creating a solid foundation with the bigger picture goal of financial wellness with financial well-being and financial mindset.

Your mindset sets the tone for your thoughts, actions, and responses. I think of your mindset as being a controlling device for your day, week, or year. Maybe another way to think about it is that your financial mindset is the rutter for your day. What is amazing to me is as we work on our mindset and make a shift to more positive, proactive thoughts you can experience an instant reaction to how your body chemistry responds, which creates momentum in your responses to situations, communications with others (as well as yourself) therefore by proxy creating a better situation. Your mindset is often ingrained from your past and the past of our parents and their parents as your mind adapts to what it thinks is the norm.

A study on fleas conducted by researchers at Stanford University showcases how our brains are conditioned to form mindsets. An important note about fleas to understand the impact of this study is that fleas are naturally born as impressive jumpers, they can leap 150 times their body size due to the strength of their hind legs, in fact their hind legs are so strong they can accelerate faster than any other animal on earth (I promise there is a point to this story).

• Stage 1 of this research was to place the fleas in an open jar with proper air, light, food etc. During stage 1 the fleas continued to mate grow a community and jump.
• During stage 2 a lid was placed on the jar. For the first few weeks of stage 2 the fleas would continue to jump hitting the lid of the jar, roughly one week after being in the closed jar the fleas stopped jumping- a shift in mindset, they had learned they could only go so far.
• At stage 3 the lid was taken off the jar, the fleas no longer tried to jump, nor did the newly hatched eggs. Eventually all was right with the flea colony, and they began to jump and so did their offspring, however it took a few generations.

Financial well-being becomes the source of how you feel about your financial situation, it creates confidence which can support in that shift of mindset. Financial well-being incapsulates that you have an ability and desire to be in a state of “goodness” with your financial situation, understand your goals, and understand the path needed to be taken to achieve your goals. Once you have achieved this understanding you have the ability to create or co-create and to have financial freedom. This freedom allows you to continue to pursue your goals and allows you to continue to live the life you want.

Money and Finances are no different than any other aspect of our lives. Our mindset controls what we think about any given aspect, what we consider as achievable with those aspects and how we appreciate what we have achieved. Well-being brings us to the understanding and allows us to enjoy what our mindset has created as well as provides us freedom. Don’t fear money or financial wellness, embrace money and financial wellness. Educate yourself, empower yourself, shape your mindset to guide you to the wellbeing of your goals and be the flea that JUMPS as high as you can.

Crafting Video Content to Guide First-Time Homebuyers in 2024

Mike Faraci, CEO of Red Button Media

As we step into the new year, the mission to guide our early-journey, first-time homebuyers becomes more crucial than ever. Wondering what video content to create in 2024 to aid first-time buyers? Here are some simple, straightforward ways you can hit the red button, make more video, and provide tons of value to your future clients.

Mastering Financial Literacy: Expert Insights

• Talk about strategies to help clients create a solid financial foundation.
• Give your best tips for enhancing and maintaining a credit score.
• Present different techniques for managing existing debts to improve financial health.

Organizing the Paper Trail: Setting Everyone Up for Success

• Review document checklists to prepare for a seamless mortgage process.
• Emphasize the significance of early document preparation.
• Streamline paperwork procedures for efficiency.

Mortgage Masterclass: Foundational Mortgage Education

• Break down the complexities of mortgage types and terms.
• Enlighten future clients on the impact of interest rates and why they move the way they do.
• Present a step-by-step roadmap, from pre-approval to the closing curtain.

Goal-Setting: Nurturing Realistic Targets

• Assist clients in determining realistic budgets based on what they qualify for AND what they can afford.
• Help clients identify must-haves and deal-breakers in their dream home.
• Craft custom roadmaps for clients to achieve their homeownership goals.

Loan Officer Look-In: Real Talk Behind the Scenes

• Give a look into the ways loan officers support the homebuying process.
• Address common concerns and queries in Q&A format.
• Showcase real-life success stories of first-time buyers under your guidance.

Every video is a step closer to unlocking the doors of dream homes for your clients. The more value you give, the more trust you will build with your future customers and referral sources.

Unlocking Financial Wellness with Ongoing Mortgage Approvals

Jeremy Potter, President, titleLOOK

One of the things the mortgage industry continues to struggle with is the on-going approval. When I think of the most valuable (most powerful?) data across almost any industry, almost any use case, it is real-time data. Sure, someone is gonna point out the exception where real-time data cannot be analyzed properly or macroeconomic data that needs to be understood in hindsight. Ok. In business and for consumers, in their own financial lives, the best dashboard, the best data is real-time data.

Many consumers are thinking about financial data at this time of year because New Year’s resolutions and financial wellness, like physical wellness, are top of mind when making personal changes. So for those consumers and the loan originators that work with consumers, January represents a time for improving financial wellness and/or making goals for homeownership “in the next year.” New Year, New You, amirite?

The most comprehensive view of consumer financial wellness is usually available only through wealth management tools. Mortgage loan originators (MLO) gather a snapshot that is a strong view of the consumer’s financial picture. What consumers should start to consider and what mortgage lenders (and the tech companies that support them) can provide is an on-going assessment of the consumer’s financial status. Admittedly, if provided by a mortgage company or MLO it is inevitable that the assessment will be in the context of creditworthiness for a mortgage. Since most consumers and many first-time homebuyers do not have a wealth advisor, a mortgage preapproval is as comprehensive a view as they are likely to get.

Unfortunately, it remains a moment-in-time analysis for many lenders.

When I think of the best way MLOs can support consumer financial wellness in 2024, the answer is ongoing approval. Using tools and the insights currently available, we can be providing a more tailored and curated experience. Over time, our companies and entrepreneurs need to be solving this challenge.  There is no reason consumers should have to resupply or revalidate data throughout the year if they are working with a licensed partner (broker, banker, CFP, advisor, etc.) to understand their homebuying power. Additionally, any program or assessment should not have a negative impact on their credit or cost them. Once actively shopping for a home, this only becomes more true.

2024 will be the year of proactive finance. Competition and tech innovation are converging with market trends (i.e. interest rate environment and demand) to create the perfect storm that should benefit consumers and MLOs alike. Consumers should be provided their mortgage approval (not preapproval) based on a certain credit limit and periodic product & pricing to understand their buying power, homes currently listed that fall within their buying power and how a mortgage monthly payment would look at any given time. These 3 pieces are all available but rarely brought together in one view with real-time data.

To achieve the best financial wellness this year, consumers need our help but should be able to see what homeownership means to them in their market, with their actual data, anywhere, anytime.

Breaking Barriers: How Down Payment Programs Bridge the Affordability Gap

Rob Chrane, CEO & Founder of Down Payment Resource

Most first-time homebuyers are well aware that interest rates are at record highs and affordability is plummeting. What they are not hearing is that there are over 2,200 homebuyer assistance programs available to help.

While it’s never a bad idea to decrease debt and save more, future homebuyers should also know that program providers have been working hard to address affordability issues by ensuring the programs they offer meet the needs of their markets. For this reason, many programs now allow funds to be used for buydowns and other popular financing strategies that take the edge off of monthly mortgage payments and can get buyers into homes much sooner than they may think.

For example, Maryland Mortgage Program’s ​​​Maryland SmartBuy 3.0 gives homebuyers an opportunity to purchase a home in Maryland, while paying off student debt. Eligible homebuyers can receive up to 15% of the home purchase price to pay off outstanding student debt, with a maximum payoff amount of $20,000.

To help address the affordability crisis, as well as the homeownership gap, the state of Rhode Island offers the FirstGenHomeRI program, which offers eligible first-generation homebuyers up to $25,000 in down payment help. The program defines a first-generation homebuyer as “any person whose parents or guardian never owned a home during the homebuyer’s lifetime or lost the home to a foreclosure or short sale and does not own a home now.” The definition also includes “anyone who lived in foster care.”

Davis County, Utah recently launched an inaugural homebuyer assistance program to help low- to moderate-income (LMI) families achieve their homeownership dreams. According to its website, Davis County began offering homebuyer assistance because “home prices in the last several years have dramatically appreciated across the state,” which has created an “unprecedented challenge to homeownership.”

The bottom line is many consumers put homeownership on hold due to a misunderstanding or lack of information regarding home financing options and requirements. Mortgage and real estate professionals should educate themselves and their clients about affordability programs to ensure homebuyers are armed with the essentials they need for their wealth-building journey to homeownership.

Help Consumers Build Their Credit Profile

Sue Buswell, Credit and Score Consultant #sueknowsthescore

Building good credit is a gradual process that involves responsible financial behavior. Here’s a guide to help consumers start their credit journey, incorporating credit union credit building accounts, authorized users, and additional tips:

It’s difficult to get credit when you don’t have credit, so follow some of these #skts tips to get started on your journey.

1. Open a Basic Checking Account:

Start by opening a basic checking or savings account at a Credit Union. Credit unions often offer favorable terms for members, and some may have specific products designed to help you build credit.

Pro-Tip – sueknowsthescore chose credit unions over other financial institutions for 3 reasons:

You earn money on your moneyin the form dividends.

You have access to a variety of account options with no fees attached

You become an owner in a Credit Union vs a customer of other financial institutions – they are not for profit so you earn those dividends.

2. Explore Credit Union Credit Builder Loans:

Many credit unions offer credit builder loans. These are small loans that are designed to help you establish or improve your credit history. Payments are reported to the credit bureaus, helping you build a positive credit history.

3. Become an Authorized User:

Ask your parents or a close relative if you can become an authorized user on one of their credit cards. As an authorized user, you can benefit from their positive credit history, potentially giving your credit score a boost.

Pro-Tip – Ensure whomever you are asking for this has a good payment history – authorized user accounts report their history, so if they get behind, it will negatively affect you.

Ensure the creditor reports on you as the authorized user. Most major credit card issuers and some department store card will report on the authorized user. Call and ask.

If you are applying for a home loan, the authorized user account will be discounted and may be requested to be removed from your credit report if you are not financially responsible for the payment.

4. Apply for a Secured Credit Card:

A secured credit card requires a cash deposit as collateral, making it easier to qualify for if you have limited or no credit history. Use the secured card responsibly, making on-time payments, to build positive credit history.

Pro-Tip – NEVER charge more on this card than you can pay every month. Remember, you put $250 or whatever amount of your own money as collateral for a $500 or higher limit.

If you are unable to pay your full balance at the end of the month, you are paying the card company interest ON YOUR OWN MONEY.

5. Check Your Credit Report:

Obtain a copy of your credit report from each of the three major credit bureaus (Equifax, Experian, and TransUnion). You are entitled to one free report from each bureau annually through AnnualCreditReport.com. Refer to the How to Check your credit report guide for tips.

6. Make Timely Payments:

Always pay your bills on time. Payment history is a significant factor in your credit score, responsible for at least 35%. Set up reminders or automatic payments to ensure you never miss a due date.

7. Keep Credit Card Balances Low:

Try to keep your credit card balances well below your credit limit. High credit card utilization can negatively impact your credit score. Aim to use no more than 30% of your available credit. If you’re just building your credit your balance to limit should likely be 10-20%.

8. Monitor Your Credit Score:

Keep a close eye on your credit score and report regularly. Many credit card companies and Credit Unions offer free access to your credit score. Monitoring your credit allows you to catch any errors and track your progress.

Remember, building good credit takes time, so be patient and consistent in your efforts. Regularly reassess your financial habits and adjust them to support your credit-building goals.