SmartOne Financial Wellness Blog

Podcast: Understanding the 5 C’s of Credit and Your Credit Score
Authored By: UnitedOne Credit Union on 3/27/2024

Credit can be a scary topic for some. However, it doesn’t have to be.

The Local Home Loan Experts at UnitedOne Credit Union clear up any confusion about credit and its role in applying for a loan on the latest edition of their podcast, At Home on the Lakeshore.



By definition, credit is the ability of a person to obtain goods or services before payment, based on the trust that payment will be made in the future.

But when it comes time to take out a loan, your credit is best defined by five other words that start with a ‘C’ – character, capacity, capital, conditions, and collateral.

“I don’t know if people understand what the 5 C’s of credit are, which is kind of an overall picture of a loan versus just the credit report,” said UnitedOne Mortgage Specialist Julie Peot, NMLS #441412.

• Character: Credit history and repayment reliability.
   
• Capacity: Ability to repay debts based on income and financial obligations.
   
• Capital: Financial reserves and assets for debt repayment.
   
• Conditions: Economic and industry factors affecting repayment ability.
   
• Collateral: Assets pledged to secure the loan.

While the 5 C’s of credit provide indicators of creditworthiness during the loan process, credit scores offer a numerical representation of a borrower’s credit risk. Credit scores typically range from 300 to 850 and are generated by credit bureaus based on the information in your credit report.

“We generally like to see your credit score in that good range, so 670 to 739, but that doesn’t mean that we cannot lend to someone who has a (lower) credit score,” said UnitedOne Mortgage Specialist Linda Serrano, NMLS # 441416.

“Exceptional is between 800 and 850. We see some of those, but they’ve probably had their credit for a longer period of time and they’ve established themselves. So, if you’re just establishing your first credit history, like first car or first credit card, you might have a lower score. We’re here, and we’re going to help you out to raise your scores.”

Paying the full monthly balance on a credit card instead of just making the minimum payment and only utilizing some of your credit limit will help improve your credit score. Ultimately, those habits will reap benefits down the road when taking out a loan.

“Your (credit) score usually gets you a better rate in loans,” said UnitedOne Mortgage Specialist Kari Johnsrud, NMLS # 441414. “Not only home loans, but car loans and your car insurance. There’s so many things that working on your credit to build a good credit score can help you with.”

The three nationwide credit bureaus UnitedOne Credit Union uses to pull credit scores from are TransUnion®, Equifax®, and Experian®.

“UnitedOne reports to all three, so you’re gaining credit in all three of those companies,” Peot said. “There are financials out there that don’t report to all three. They may only choose one or two to report, so sometimes you'll see those credit scores vary. … When we pull all three, we use the middle score, so we kind of average out those three scores and use the middle one for qualifying.”

Your credit score doesn’t have to remain a mystery until you’re ready to apply for a loan. You can access a free report at www.annualcreditreport.com or by calling 1-877-322-8228.

“It lists all of the information in a way that is that you’re going to be able to understand it,” Serrano said. “You don’t have to work in banking or anything like that to be able to understand what the credit report is showing you, but if still feel like, ‘I want that extra person to help me out,’ we definitely are here. You can call us, and we can set up an appointment.”

Whether you’re in the market now to buy a home or want to learn more about improving your credit score so you’ll be ready to house shop in the future, UnitedOne’s team of Local Home Loan Experts are your trusted source in Manitowoc and Sheboygan for all your home loan needs.

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Local Home Loans Local Experts
10 Year Fixed - Home Equity Loan 
Apply Now    Book Appointment   Mortgage Center Log In   Email Mortgage Team  

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Listen to more episodes of At Home on the Lakeshore

UnitedOne achieves esteemed recognition in MemberXP Best of the Best Awards
Authored By: UnitedOne Credit Union on 3/22/2024

UnitedOne Credit Union has been designated as a MemberXP Best of the Best Credit Union for Best Member Advocacy and Most Appreciative Staff.

"Improving members’ financial well-being is why we are here,” UnitedOne CEO Kim Rooney said. “Our employees come to work every day ready to help our members succeed financially. Awards like these are the result of their hard work and commitment."

The MemberXP designation is an annual acknowledgment bestowed upon credit unions that consistently excel in delivering exceptional member service during a calendar year. 

MemberXP uses mystery shoppers and member surveys to gauge the overall member experience across multiple delivery channels. In 2023, over 300,000 surveys were deployed nationwide among nearly 8 million credit union members, spanning all 50 U.S. states.

UnitedOne Credit Union has branches in Manitowoc and Sheboygan, and is open to everyone living or working in Manitowoc, Sheboygan, Kewaunee and Door counties. The credit union serves consumers and small to mid-sized businesses. 

MemberXP, a product of CU Solutions Group, is the pioneer and market leader in Credit Union Experience Management. The MemberXP technology platform enables credit unions to collect, manage and act on member experience data collected via digital surveys and mystery shoppers.

5 Compelling Reasons to Buy a Home in Manitowoc, WI Right Now
Authored By: UnitedOne Credit Union on 3/14/2024

Are you dreaming of owning a home in the heart of the Midwest? Look no further than Manitowoc, Wisconsin! Nestled along the shores of Lake Michigan, Manitowoc offers a unique blend of small-town charm, natural beauty, and a thriving community spirit. And guess what? There's never been a better time to make Manitowoc your home sweet home. Here are five fantastic reasons why buying a house in Manitowoc, WI should be at the top of your list, brought to you by UnitedOne Credit Union.

• Affordable Real Estate Prices: One of the most appealing aspects of Manitowoc is its affordability. Compared to larger metropolitan areas, housing prices in Manitowoc are remarkably reasonable. Whether you're in the market for a cozy bungalow or a spacious family home, you'll find a wide range of options that won't break the bank. With the forecast of lower interest rates in the second half of 2024 and a recovering market, now is the perfect time to snag your dream home at a price you can afford.

• Strong Community Spirit: In Manitowoc, neighbors aren't just neighbors—they're family. The tight-knit community here is known for its warmth, friendliness, and willingness to lend a helping hand. From annual festivals and farmers' markets to community events and local gatherings, Manitowoc fosters a sense of belonging that's hard to find elsewhere. When you buy a house in Manitowoc, you're not just investing in property; you're investing in a community that welcomes you with open arms.

• Breathtaking Natural Beauty: Prepare to be awe-struck by Manitowoc's stunning natural scenery. With Lake Michigan to the east and picturesque countryside to the west, outdoor enthusiasts will find plenty to explore and enjoy. Spend your weekends hiking along the shores of the lake, fishing in pristine waters, or simply taking in the breathtaking sunsets. No matter the season, Manitowoc's natural beauty never fails to impress.

• Excellent Schools and Amenities: For families with children, Manitowoc offers top-notch educational opportunities. From highly-rated public schools to renowned private institutions, parents can rest easy knowing their children are receiving a quality education. Beyond academics, Manitowoc boasts a plethora of amenities, including parks, recreational facilities, shopping centers, and restaurants. Everything you need is right at your fingertips, making Manitowoc an ideal place to raise a family.

• Investment Potential: With the real estate market in Manitowoc on the rise, purchasing a home here is not just a place to live—it's a smart investment. As the economy continues to recover and the demand for housing grows, property values in Manitowoc are expected to appreciate steadily over time. By buying now, you're not only securing a place to call your own but also setting yourself up for long-term financial stability.

The time to buy a house in Manitowoc is now. With affordable real estate prices, a strong sense of community, breathtaking natural beauty, excellent amenities, and promising investment potential, Manitowoc has it all. So why wait? Take the plunge and make Manitowoc your home today! And remember, UnitedOne Credit Union is here to help you every step of the way on your journey to homeownership. Contact our mortgage team to get started!

 

Podcast: How to Build Your Dream Home with a Construction Loan
Authored By: UnitedOne Credit Union on 2/16/2024

Building your dream home from the ground up is an exciting endeavor.

A construction loan is an essential tool in turning blueprints into reality for many aspiring homeowners.

“In this market, when there are not a ton of houses out there for sale, sometimes it can be a nice option to purchase a piece of land and to build instead,” said UnitedOne Mortgage Specialist Kari Johnsrud, NMLS # 441414. “You’ll get the home that you want the way you want it.”

The Local Home Loan Experts at UnitedOne Credit Union delve into what a construction loan entails on the latest edition of their podcast, At Home on the Lakeshore.

A construction loan covers both the interim building phase and the permanent loan once the home is finished, eliminating the need for multiple loans.

The first nine months of the loan, also known as the draw period, disburses funds to contractors or subcontractors during the building phase. This period features a lower rate, interest only payment on outstanding balances plus property taxes if applicable. 

Once the house is finished, the loan rolls automatically converts to an ARM loan/permanent financing (for primary residence/second homes only).

One of the biggest benefits of a construction loan is it features a one-time close.

“The one-time close that we do offer here saves you money in that construction-to-permanent phase,” said UnitedOne Mortgage Specialist Linda Serrano, NMLS # 441416. “That’s something we love to do for our members to save them money.”

If you haven’t purchased the lot you plan to build on the initial draw disbursement in a construction loan will include the payoff of the land.

“Some people purchase the land first and pay on it for a while before they choose to build, and that’s OK, too,” Johnsrud said.

Construction loans also can be an excellent option for bigger remodeling projects to an existing home, like adding a second floor or changing layouts of a house.

Whether you’re planning to build new or do an extensive remodel, it doesn’t hurt to start doing your research now on prospective builders if you anticipate doing a construction loan in the upcoming years.

“It’s not too early to start,” said UnitedOne Mortgage Specialist Julie Peot, NMLS # 441412. “I know there are already some builders looking for builds in 2025. It’s not too early to start talking through options because it’s going to take time to get everything you’re looking for.”

By meeting with UnitedOne’s team of Local Home Loan Experts in Manitowoc and Sheboygan, aspiring homeowners can embark on their home-building journey with confidence knowing they have the financial support to bring their vision to life.

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Local Home Loans Local Experts
10 Year Fixed - Home Equity Loan 
Apply Now    Book Appointment   Mortgage Center Log In   Email Mortgage Team  

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Listen to more episodes of At Home on the Lakeshore

How to Inflation-Proof Your Finances
Authored By: UnitedOne Credit Union on 2/12/2024

The increasing cost of daily necessities – most noticeably groceries – is again closing the gap between income and expenses. With few places to make cuts, many people are resorting to credit cards to make ends meet.

According to data from the Federal Reserve, consumers’ total credit card debt reached $1.03 trillion in the second quarter of 2023, the highest amount on record.

Though the use of plastic may work in the short-term, be cautious about using credit cards as a long-term solution to cash-flow problems.

Even if you’re still able to make the monthly payments, relying on credit cards could put you into a danger zone. For example, are you charging more than you used to? Or carrying over part of your debt into the next month when you used to pay off the full balance each month?

If your credit card debt becomes so high that you can’t even make the minimum payment within 30 days of its due date, your credit score could drop by as much as 100 points. That late payment will stay on your credit report for seven years, making it harder to get loans in the future.

If you’re starting to feel the pinch of higher prices, here are a few ways to protect yourself from serious financial trouble:

• Figure out how much you’re spending on gas, groceries, and other necessities every month compared with a year ago. You may not even realize you’re spending more, because you haven’t changed your lifestyle.
   
• Revise an outdated budget using the information you gather. Identify where you can make cuts. Start with any remaining luxuries but be prepared to economize on necessities.
   
• Plan for further price increases. Looking at your new budget, ask yourself how you would make ends meet if gas went up another dollar or groceries cost you an additional $75 per month. Recession- and inflation-proofing your finances is all about planning, as opposed to reacting.
   
• Look for reductions in income. For example, retired consumers may find they have to tap into their principal to achieve the same annual income they used to get from the return on their investments.

If you’re already watching your debt climb and you can’t see any alternative to using credit cards, contact UnitedOne Credit Union today to discuss your options for consolidating debt. You can book an appointment online to see a Member Service Representative or call us at (920) 684-0361 in Manitowoc or (920) 451-8222 in Sheboygan.