“Good/Bad Credit” is something a lot of people struggle with and our FINANCIAL EMPOWERMENT Program offers 1:1 assessments to help our residents better understand and improve their credit score.

Read along and see how we’ve been able to change the way Joshua and Sarah, among others, manage their finances today.

Joshua is in the Army National Guard and works a full time job and is a part-time Bunker Hill Community College student. Joshua moved to his own apartment – his first solo apartment – in Chelsea at the beginning of May 2019.

He is grateful for his independence in his living situation and he sought financial coaching in order to maintain this new independence for himself. His primary goal is to raise his credit score from a 620 to a 660.

To accomplish this goal, he learned how to use credit cards as credit building tools. He learned how to calculate his credit utilization ratio, which he was not aware of prior to financial coaching. He now understands how obtaining a new credit card can improve his credit utilization ratio (and how closing a credit card could potentially hurt his credit score by raising his credit utilization ratio back above 30% utilization).

He obtained a secured credit card with Capital One. He is further committed to ensuring that he doesn’t charge more than $60 per month on this Capital One secured credit card (to stay below 30% utilization). Moreover, he is committed to paying his statement balance on time on his Capital One secured card for the next 4 months so that he can then request a credit limit increase once he has had the card for 6 months, thereby improving his credit utilization even further.

Sarah was a single mother and recently got a job with the T upon moving back to Boston from Georgia. Her credit stood in her way of finding housing. We found a lot of work to do on her credit file, disputing accounts and creating a debt management strategy. However, Sarah was very proactive and wanted to build her credit using alternative financial products.

After we talked with her on how credit scores were calculated, Sarah researched suggested cards and loans. She brought in her findings and listened as we guided her through the pros and cons of each product. After only five hours of coaching, over the course of a few weeks, Sarah felt ready to take the first steps.

Sarah applied for, and received, her first secured credit card online. During the next session, we accompanied her to her local credit union to request a shared-secured loan. We sat with her to explain the representative's conditions when necessary, and guide Sarah to find the appropriate installments for her discretionary income.

Today, Sarah is building her credit comfortably one payment at a time. Over time, her credit score rose from the 400s to the 700s and she’s now actively searching for housing. She is using all of the tactics set out in the debt management strategy, and is on her way to home ownership.

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