Your Credit Score Explained

We are continuing to add information on credit scores to this post.


Click here to read "Don't Micromanage Your Credit Score" by Jennifer Waters of The Wall Street Journal from March 3, 2012.

• Ms. Waters states, "A score is determined mainly by how promptly you pay your bills and what kind of debt you carry, though other factors also feed into it. "
• Also in the article is, "Scores also vary because the three credit-reporting companies don't have the same information. 'Lenders don't report all the same things to all the [credit-reporting companies], which is why scores will vary,' says Beverly Harzog, a credit-card analyst with Credit.com."
• Eaton Family Credit Union reports to all three credit reporting agencies.

Click here to read "What happens to your credit score when a card gets closed?" by Theresa Dixon Murray of The Cleveland Plain Dealer from December 9, 2011.

• Ms. Murray responds to the question: What happens when the card issuer closes out the card due to inactivity? How does that impact your score?

The definition of a FICO Score from Barry Paperno, Consumer Affairs Manager, myFICO.com

• A FICO score is a three-digit number between 300 and 850 that summarizes a person's credit risk based on their credit report at a particular point in time.
• The number tells a prospective lender how likely someone will pay on time, with higher scores indicating lower risk and with lower scores indicating higher risk.
• What the score looks at on a credit report is how the person pays, how much he or she owes, how long they have credit, to what extent any new credit has been taken on and the different types of credit experience they've had.
• Information the score doesn't look at on a credit report includes marital status, gender (and) race. It doesn't even look at the name or address, so the location has no bearing on it.
• Another thing it doesn't look at that is commonly misunderstood: It does not look at income or assets or anything like that.

Also in this Yahoo! Finance article titled "FICO insider explains credit scores," by Janna Herron, from Tuesday August 30, 2011

• Why do the scores differ by credit bureau?
• How often scores change?
• How to see your FICO score?

Click here to read, "FICO's 5 factors: The components of a FICO credit score" by Jeremy M. Simon, from CreditCards.com.

1. Payment History
2. Debit Amounts
3. Length of Credit History
4. New Credit
5. Credit Mix

Thanks to our friend, Ondine Irving, for the heads up.

We Don't Prioritize For Overdrafts

On February 22, 2012 The Cleveland Plain Dealer Consumer Affairs Reporter Sheryl Harris wrote a story about the Consumer Financial Protection Bureau and their investigation of financial institution fees called, "Agency to investigate bank overdraft fees."

In the article she states, "...the agency wants to know whether banks process consumers' transactions in an order that makes overdrafts more likely."

We process transactions chronologically. If you have overdraft protection on your Eaton Family Credit Union checking account, be assured that we do not process transactions to maximize overdraft fees.

More specifically, we process your account transactions as they come in. Here are some details by category:

• Debit Cards - when debit cards are processed after purchase is important because some companies process immediately and others batch process. Therefore you might purchase an item today but we will not see the transaction until tomorrow or the day after. We handle debit transactions daily.
• Checks - checks are processed in chronological order by check number on a daily basis. You write check number 100 before check number 101 so we handle the lower number check first.
• Electronic - today paper checks are often converted to electronic transactions and many payments, such as auto debit, are electronic as well. These transactions are also handled daily as they come in.
• ATM - instantaneous throughout the day. If you take out money from an ATM in Cleveland, Ohio, or Cleveland, Tennessee, or in Cleveland, UK (north east area of England) then it comes out of your account immediately through one of our ATM networks.

Knowing your balance is an easy way to minimize overdraft fees.

1. Write It Down - keep track of your transactions and account balance with a check book ledger.
2. Online - with our free home banking you can access account information on the web 24/7.
3. Phone - by voice or touchtone, our free MATT Line gives you account information 24/7.
4. Mobile - text, via mobile web or with iPhone App. Get your account information on the run 24/7 for free from us.
5. Member Center - after hours you can get account information via phone at no charge from our member center.

Local Credit Union Fraud - Not In My House

At Eaton Family Credit Union we take our jobs very seriously. We appreciate that you trust us to make good decisions. Below you will find articles about the investigation at St. Paul's Croatian Credit Union in nearby Eastlake and the efforts we take to ensure your money is safe with us.


On February 9, 2012 another article was featured on the front page of the The Cleveland Plain Dealer that focuses on an organization that makes investments throughout northeast Ohio. The article by Michelle Jarboe McFee, "Cleveland International Fund looks for way forward after resignation, indictment of CEO" includes references to alleged fraud committed at the failed St. Paul Croatian Federal Credit Union. A companion article by John Caniglia, "Pepper Pike financier A. Eddy Zai indicted in Croatian fund swindle" references bribes paid to St. Paul's officials.


On September 28, 2011 The Cleveland Plain Dealer ran an article by James F. McCarty titled, "Chief executive officer of Croatian credit union pleads guilty to stealing $70 million, bankrupting the Eastlake bank."

The article starts, "The once trusted head of the St. Paul Croatian Federal Credit Union in Eastlake confessed Tuesday to stealing more than $70 million and triggering the collapse of the 67-year-old institution."

We want to address some of the points in the article to explain how this sort of thing cannot happen at Eaton Family Credit Union.

Fraudulent Loans

• The article mentions that loans were dispensed without requiring collateral, borrowers had little or no assets, no employment history and often with fictitious names.
• At Eaton Family Credit Union the borrower must complete and sign a loan application. Our loan officers verify this information against the credit report. We ask for employment verification.

Fraudulent Payment

• The articles notes that, "most borrowers made little or no repayments."
• Eaton Family Credit Union loans must be repaid. We report loan history (payment and non-payment) to all three credit reporting agencies. Our delinquent loan rate matches peer averages, but from time-to-time we need to efficiently and legally collect delinquent loans.

Oversight

• The article mentions that federal investigators said the credit union managers, "were running a scam, stealing millions of dollars in phony loans from the credit union."
• In addition to a professional management team and experienced board of directors, Eaton Family Credit Union has an outside, third-party auditor. We are also subject to state, federal and private insurance audits.

We take our jobs very seriously and intend to be here for a very long time...thank you for your support.

Debit Card: Suze Orman vs. Eaton Family Credit Union

We really like Suze Orman. We're in agreement with her about making informed decisions, setting up emergency fund accounts and the value of using credit unions.


We differ when it comes to The Approved Prepaid MasterCard® which she has "created from the ground up."


Here is a comparison between Suze's card and Eaton Family Credit Union's FREE checking with Debit MasterCard:

• Fee
• Suze = $3.00 per month or $36 annually.
• EFCU = no annual fee.
• Convenience
• Suze = debit card or ATM.
• EFCU = debit card, ATM, EFCU branches, credit union shared branch partners and paper check options.
• Credit Score Monitoring and ID Theft Protection
• Suze = TransUnion credit score monitoring TrustedID protection included.
• EFCU = $2.50 per month - click here for more details on our ID Theft protection and we encourage you to check your THREE credit reports annually for free at AnnualCreditReport.com.
• Insured
• Suze = FDIC Insured to $250,000 (she is working with a bank).
• EFCU = Insured to $500,000 with $250,000 NCUA federal insurance plus an additional $250,000 ESI private insurance.
• Account Balance
• Suze = text alerts, automated telephone system and customer service - One FREE call per calendar month; $2.00 per call thereafter.
• EFCU = no charge online, mobile, MATT TouchTone Teller plus live help during business hours in our branches and 24/7 through the member center.
• Online Bill Pay
• Suze = free.
• EFCU = our Webster Bill Pay is free plus you're able to pay others via ZashPay and transfer funds in/out.

We know that prepaid debit cards are NOT exactly the same as a full-fledged checking account but we do want you to be an informed consumer. Check out Suze's fees and compare them to our fees.

Click here to view a New York Times article by Ron Lieber called, "TV Adviser on Money Offers Card." As Mr. Lieber points out, we feel that privacy advocates should take notice that Suze has cut a deal for "TransUnion to collect spending data from Approved card customers."

Click here to view a Forbes article on Personal Fiance called, "Does Suze Orman's Prepaid Card Live Up to its Namesake?" The Approved Card is compared to other popular prepaid debit cards including Green Dot and American Express.

Click here to view an article from the blog GetRichSlowly called, "Does Suze Orman's Prepaid Debit Card Make Sense for You?" Sarah Gilbert does a nice job of summarizing the industry and gives Suze a thumbs up with some caveats.


Click here to view an article from American Banker  called, "Why Do Prepaid Debit Cards Have Such a Bad Rap?" Jennifer Tescher states, "The criticism about the Approved Card is largely focused on two issues — fees, and whether Orman can be trusted."

Holiday Cheer For Notthingham Home Residents

Eaton Family Credit Union offered up holiday cheer to residents of Nottingham Home in Cleveland with gifts from Santa, holiday singing and a pizza party. The event is a highlight of the holiday season for everyone.


Nottingham is a large, accommodating home that has been renovated to address the special needs of older residents. This program is part of an ongoing effort to create a continuum of opportunities for people with developmental disabilities to encourage integration into the community.

Click here or go to EatonFamilyCU.com/Charitable.php for pictures and learn more.

Tax Time Savings: TurboTax and Jackson Hewitt

Get discounts on tax preparation this year through Eaton Family Credit Union.

• Click here to save when using TurboTax Online
• Click here to get your $30 Jackson Hewitt discount

With TurboTax Online you can self prepare your taxes this year and electronically file your tax returns. TubroTax Online uses an interview style format to asks question then the answers are put on the appropriate lines on the appropriate IRS forms...just answer the questions and let the program do the rest.

If you prefer working with a Jackson Hewitt tax professional face-to-face then download a $30 coupon today...you get the savings now matter simple or complex your return. Click here then enter your zip code to find the near Jackson Hewitt office or call 800-234-1040 for more information on pricing.

Credit Unions Win Out vs. Banks

On November 19, 2011 The Seattle Times ran an article by Gregory Karp (Chicago Tribune) called "Money Tip:  How consumers can find a banking champ."

Click here to read the entire article.

In the article Mr. Karp writes, "So, big or small? Who wins on the merits in a toe-to-toe fight between megabanks and smaller institutions? Is bigger better, or is this a Rocky Balboa story?"

Here are the categories and his ratings and our thoughts...

Round 1: Fees

• Winner: Smaller institutions.
• We agree. Our goal is the same as the banks: maximize shareholder value...the difference is that you're the shareholder at Eaton Family Credit Union, so that's why we strive for lower fees, higher interest earned and lower interest charged on loans.

Round 2: ATM Access

• Winner: Big banks.
• We disagree. Eaton Family Credit Union owner/members have access to thousands of surcharge-free ATMs nationwide. In Ohio, Midwest and Western states through the MoneyPass network featuring U.S. Bank. Plus credit union partners nationwide through the AllianceOne network.
• Click here to see our ATM options and let us know what you think.

Round 3: Branch networks.

• Winner: Big banks.
• We disagree. Shared branching is the best example of the cooperative nature of credit unions. With 4,000+ shared branch credit unions you can deposit funds, get cash and make loan payments near home or work for just about everyone. And not just in metropolitan areas!
• Click here to find a shared branch near you.
• So far Eaton Family Credit Union owner/members have used shared branch partners in 36 states.

Round 4: Customer service.

• Winner. Smaller institutions.
• Heck yeah.

Round 5: Ownership.

• Winner: Smaller institutions.
• Yep, that financial cooperative thingeedoo does make a difference because we work for you.

Round 6: Financial products.

• Winner: Big banks.
• Well, Mr. Karp, that wealthy crack doesn't really make it with us, because at Eaton Family Credit Union all accounts are insured up to $500,000.
• Yes, we cannot compete on some business banking services but smaller enterprises appreciate us too.

Round 7: Technology.

• Winner: Big banks.
• Hold on a second buster. Now all this stuff is free: online account access, voice-activated account access, mobile account access, online bill pay and 24/7 account information from a live person.

Round 8: Rates

• Winner: Rates.
• Yes.

Round 9: Safety

• Winner: Draw.
• Well, actually, we're better here too. Not only are all account FEDERALLY insured up to $250,000, but we also offer private insurance for an additional $250,000 up to a total  of $500,000 for each account....#winning.

Contact us or go to EatonFamilyCU.com to learn more...YO ADRIENNE.