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Picture this: it’s the first of the month… your bank account is near empty… and rent is due.
So… you go to a payday lender to fill in the gap until you get paid… but then your car breaks down and you have to borrow again… digging a hole of debt that’s hard to get out of.
These scenarios happen to millions of Americans each year… but I’m here to help you not make a tough situation into a financial disaster.
In this video, I will tell you what predatory financial services to watch out for… how they operate… and better solutions to save you both money and stress.

Predatory services deceive or exploit borrowers to get them to accept unfair or abusive terms on loans that they don’t need, want or can’t afford.
Payday loans or cash-advance loans for example… are usually short-term loans you are supposed to pay off in about two weeks.
You get quick cash with no credit check and very little asked… which might sound good when rent is due or your car breaks down… but the reality?
High fees equaling between 300-to-800-percent APR make paying it off difficult… and if you can’t pay it back in time… they will gladly extend your loan… for additional fees.
These businesses say that they are filling a short-term need that banks and credit unions are not.
This may be true in some cases… but not all of them.
The truth is more than 80 percent of payday loans are reborrowed within a month… and according to the Consumer Financial Protection Bureau… one out of every four are reborrowed nine times or more!
That means a lot of borrowers are paying more in just fees than the amount they borrowed in the first place!
They make more money when people have a hard time repaying their loan and they are counting on it.
Not only do they prey on those who don’t have many options and need quick cash...
Some also prey on those who work but don’t have mainstream financial services.
Payday loan businesses may also offer check-cashing services for a fee for people who don’t have a financial institution.
It might be a charge of five dollars for every hundred dollars cashed… but if you think about it… that’s 50 bucks just to cash a thousand-dollar check.
If you’re paid every two weeks… that’s 1,300 dollars a year!
Most credit unions have savings or checking accounts that allow you to cash a check for free… and if you have direct deposit, you save both money… and time you’d normally waste going to these predatory businesses.

To get money fast… some people also turn to pawn shops by handing over jewelry, electronics, and other valuables… and taking a loan against them.
They draw people in by advertising loans with no credit check… and may use pressure to close the deal by saying “this offer is good for today only.”
Pawn loans are usually much less than the items are worth…
They come with high interest rates or fees… and most must be repaid within 30-to-90 days.
The kicker?
If you don’t pay it off on time… they may offer to let you extend the loan for additional fees… or they will resell your prized possession and pocket the profit.
In a 2019 survey… 73 percent of pawn borrowers reported still owing money six months later.

Now… for higher-dollar loans… some people go to car title lenders.
They function a lot like pawn shops… offering low-ball loans with high-interest rates in exchange for your car’s title.
They typically don’t do an income verification or credit check because they don’t care if you can’t pay it back.
Your car is the collateral.
If you default… you take another loan to cover it… or you’re losing your car.
Many times, car title lenders will partner with or run their own dealerships… making money off of whatever payments you already made… and profiting directly from the sale of your car.

If you’re in a situation where you are debating on getting a payday, pawn shop or car title loan… consider getting a personal loan through your credit union.
You would not only get a longer payoff timeline… but better terms and rates.
You can even use your car’s title as collateral for the loan and get a better rate… but unlike car title lenders… credit unions do run a credit check and verify your income to make sure you’re getting a deal you can afford.

If you don’t have great credit, you may be thinking there are no other options.
Not true.
Credit unions will work with people by offering alternatives to these predatory services.
Ascentra Credit Union has a service called “Cash-Now”, which allows members to borrow up to two thousand dollars without a credit check and get approval within minutes on the Ascentra app.
While we don’t run credit to approve the loan… we do report to the credit bureaus so you can build your credit as you pay it back.
Borrowers must be members of Ascentra for at least 90 days, with at least 60 days of deposit history, and loan terms vary by amount borrowed.

While payday and title loans are often the first things people think about when they hear “predatory lenders”… rent-to-own stores may fly under the radar… but can also be very costly.
Typically, they’re lending out furniture or appliances that you pay for weekly or monthly… and after you’ve finished the contract, you own the items.
They make it sound affordable…
“Just 30 dollars a week for this couch and eventually it’s yours!”
But here’s the catch… that 600-dollar couch could cost you two thousand dollars by the time you’re done.
Even their “buy now” or “same as cash” price is often double what you’d pay at a regular store.
Also keep in mind that not everyone finishes their contracts, so many items get returned to the store and rented out to someone else.
You may be paying top-dollar on an already used item that they may sell as “new to you!”.
Some rent-to-own stores brag that they don’t charge interest… but instead have incredibly high mark-ups which range from 43-to-468 percent APR.
It would be much cheaper to go to a regular store and pay cash or even put the charge on a credit card.
Ascentra’s highest credit card rate is 17.88 percent APR, which is well below the 400 percent you could be paying at rent-to-own stores.
Better credit scores get even lower rates.

Now… it’s not just suspect storefronts you should be avoiding.
Let’s talk bigger stakes, like rent-to-own homes or contract mortgages.
They sound simple…
You just pay an upfront fee or downpayment… then pay rent until you own the home.
But… it’s not that simple.
The contracts are typically written up by a lawyer who makes sure the deal benefits the seller… not you.
Sellers often target people who can’t qualify for a traditional mortgage… so buyers end up paying high interest rates and there’s usually a balloon payment at the end of the contract period.
That means the contract is structured so the monthly payments are less than what would actually pay off the loan… so when the contract ends… you still owe.
At that point… you have to pay the rest off as a lump sum.
If you can’t make that balloon payment or break any of the terms of the contract like paying rent late, having a pet, or smoking in the home, you could lose the house… and all of the money you put into it… including that downpayment.
Not only that… but many hopeful homeowners make updates to their property, like landscaping, home repairs, or renovations… and they lose out on those investments too.
If you’re looking to buy a home but don’t have enough saved up or need to work on your credit… you’re probably better off renting until you’re able to qualify for a traditional mortgage with a credit union.
At least while you rent… your landlord should take care of the home repairs and you have the ability to get your deposit back at the end of your lease.
Now, whether you have a goal to buy your home or just take control of your finances, Ascentra’s financial coaches can work with you on building credit, creating a budget you can stick to, and developing long-term strategies to get out and stay out of debt.
Once you’re ready for a traditional mortgage… you can get into a home with a fair interest rate, a longer payoff timeline and no surprise balloon payment.

Sometimes predatory services may look like a lifeboat when you feel like you’re financially drowning… but really, they’re just an anchor.
However, with a trusted financial institution, you don’t just stay afloat… you find solid ground…
So, avoid the traps, stay in control of your finances and steer toward the financial future you deserve.

If you've ever looked at your bank account and thought… "where the heck did all my money go?"… you’re definitely not alone.

The good news?

You don’t need a finance degree to get back on track.

My name is alvaro and today i’m breaking down budgets.

I’ll explain how to create money habits that actually stick… how to build a budget that works for you… what to do with extra money… and what to do if there’s not any extra.

Let’s get into it.

 First… the keys to creating a good budget are:

Keep it simple

Keep it real

And keep up on it.

When i say keep it simple… that’s because many people overcomplicate it.

They go to Microsoft Excel and create these elaborate budgets with formulas and other unnecessary add-ons… then overwhelm themselves and give up.

It doesn’t have to be that involved.

 Next…keep it real… because you want to be honest with yourself when it comes to spending. 

You don’t have to show anyone so there’s no need to be embarrassed.

If you are a smoker… a coffee shop regular… a fast-food lunch-er… make sure you’re marking that down.

Not only does it make your budget more reliable… but it helps you pinpoint the areas you could focus on making changes to later if your budget needs more breathing room.

 You also need to keep up on it.

Reference it at least as often as you get paid.

For most people... That’s every two weeks… but some people get paid every week or monthly… so you may need to adjust accordingly. 

Since not all bills are due at the same time… some pay periods may have more money leftover than others.

Referencing your budget each time you get paid helps you track what’s due… and lets you know what extra money you’ll have until your next payday.

 According to finance-guru Dave Ramsey… 53-percent of Americans are living paycheck-to-paycheck… including more than a-third of people earning over 100-thousand dollars per year!

It’s not always about having more money… but just having a better plan.

Now… budget plans are not a one-size-fits-all solution… so I’m going to go over a few options so you can determine what’s right for you… starting by using technology.

 There are many budgeting apps available… but the easiest way to keep on track is to use one that does the work for you.

Budgeting apps each have their own strengths depending on your goals.

Some are better for tracking spending… others help with debt payoff… or even wealth building.

One thing they all have in common is the ability to access your budget whenever you need it.

That way you can check what you have to spend before going out with friends… and avoid accidently overdrafting your account or not having enough when rent is due.

Apps are also great for building habits.

Reminders and spending alerts encourage you to check your budget more often… and visual tracking, like colorful graphs, make understanding your budget easier.

For ascentra credit union members…financial tools on the ascentra app has very useful budgeting features.

It allows you to create your budget… breaks your spending into categories… and shows how close you are to your budgeted amount.

You can track spending by months… look for trends… and even connect to other financial institutions so you can keep track of all of your accounts in one place.

Setting up bill pay through the app allows you to automatically make payments to help you stay on track and avoid late fees from missed payments. 

For those who are less tech-savvy… the old school pencil and paper method is the most commonly used budget… and is exactly what it sounds like.

Using loose paper or a notebook… you write out your income and expenses by hand.

Make sure you include all forms of income… your paycheck, side-hustle money, child support, alimony, social security benefits… and anything else coming in.

Then… you do the same with your expenses.

This can be a bit harder because there’s typically more streams of money going out than coming in… plus most people buy groceries or gas a few times each month.

I recommend grabbing your last couple of bank statements to help you figure out an average of what your spending… and when.

There are many templates you can find online or just go to ascentra’s website.

You can customize your template to match your needs… and plug the numbers into it.

Remember to be honest and include all of your expenses.

Once you have both totals… add up each section… and then subtract your expenses from your income. 

What’s leftover is your’s to decide how to spend.

The next budget I’m going to tell you about is similar to the pen-and-paper budget… but in this one… there’s no balance left over -- every dollar has a job.

The zero-based budget assigns a goal for your entire income.

Let’s say you make three-thousand dollars.

You would assign all three-thousand across savings, bills, groceries, gas, entertainment and so on… until there’s nothing left unassigned.

 For people who are looking for a looser framework or are newer to budgeting… the
50-30-20 budget simplifies spending into three groups.

Here’s how it breaks down your paycheck:

50-percent is budgeted for needs… like rent, groceries, or insurance…

30-percent goes to wants… like dining out, hobbies, or streaming services…

And 20-percent goes to savings or paying down debt.

A benefit to this plan is that it helps avoid overspending by setting clear boundaries between wants and needs.

 For someone who overspends easily… the envelope system may be a good alternative.

With this budget… as soon as you get paid… you take out what you need for different spending categories… and divide it into multiple envelopes.

All the money you need for groceries goes into one envelope… gas into another… bills in a third envelope and so on.

Once an envelope is empty… you stop spending in that category.

This system helps you avoid overdrafting your account… by preventing you from overspending.

Studies show that using cash and physically seeing money depleting causes people to spend less.

Some people even take it a step further… giving themselves a daily envelope budget.

For instance… say you have three-hundred dollars left after filling your bills, groceries, and other “necessity” envelopes.

Instead of using one envelope to spend the three-hundred dollars throughout the month… you could break that into a daily envelope of ten dollars per day.

What you don’t spend can roll into the next day’s envelope… and if you move leftover funds multiple times… you can use that to treat yourself or put into savings.

 Speaking of savings… the last method is the pay-yourself-first budget… which focuses on building wealth.

With this plan… before you pay any bills… you first move money to savings or investments.

Then you live on what’s left.

Direct depositing some of your paycheck into your savings account can help make this easier… and when it’s “out of sight, out of mind”, you’re less likely to dip into the savings.

 So… what do you do with that savings or other leftover money?

First… establish an emergency fund.

Aim to save for two months of living expenses in case of something major like a job layoff or time out of work due to injury or illness.

Other emergencies to save for could be home or car repairs.

Ideally you want to have some cash reserves so you’re not maxing out your credit cards everytime something happens and putting yourself into debt.

 On that note… you should also use extra funds to focus on paying down debt. 

Not only will that free up more money for you to spend on wants… but it helps save you money and can build credit.

Unless you have a zero-percent-interest introductory offer… loans and credit cards come with interest rates…

So the longer you owe money and the higher the balance… the more money you have to pay.

Your credit score is also partially determined by your credit usage… in other words… the amount of credit available to you that you’re using.

As you pay down debt and lower the usage… your credit score will go up.

I also spoke about this in our credit score video… so make sure to check that out if you haven’t seen it yet.

 After you have paid down debt and set aside money for emergencies… then you can focus on your wants and treating yourself or your family.

We call these “opportunity funds”.

You can create a savings account for a vacation, presents for the holidays, something nice for yourself… or even sports or program costs for your kids.

 Now… what if you figure out your budget and there’s no money leftover for savings or paying debt?

What if instead you have a negative number and owe more than you’re bringing in?

Well… you need to make changes… and fast.

Start by looking at your expenses and seeing where you can cut back. 

This goes back to what i said about being honest about what you’re spending so you can identify easy changes if you have to.

 If you are a coffee-shop regular… think about making drinks at home and treating yourself to a barista-made specialty once a week as a treat instead.

 A recent survey shows the average american worker spends about 16-dollars per day on lunch.

Packing your lunch could save you about 80-dollars each week.

That’s 320-dollars each month… or four-thousand-160-dollars per year.

I don’t know about you… but i could do a lot with an extra four-grand a year.

 Another easy way to cut costs is to cut the cord on streaming services.

Maybe it’s just me… but i don’t have enough time to watch entire libraries of five different streaming services every month…

So… try dropping down to one or two.

If a new show comes out on a different service… drop one and then sign up for the other one…

Binge-watch what you want… and then drop it again before the next billing cycle.

Most streaming services don’t charge you fees for dropping… so you don’t need to feel locked into paying for services you might only use every few months.

 After you’ve gone through what you can cut back… then you should look at your debt.

Can you lower any interest rates?

According to lending-tree… the average interest rate for new credit cards by mainstream companies is 24-point-three-five percent.

Credit unions are more competitive and members with better credit scores get better rates.

If you have high credit card debt and a high interest rate… consider rolling that debt onto a card with a lower rate.

 A consolidation loan may also be an option and can help you in a number of ways.

They combine multiple loan or credit card payments into one at a lower interest rate.

It can save you money and help you pay on time since it’s easier to remember one due date instead of several.

For insight on how consolidation loans can also help your credit… check out the credit score video i mentioned before.

 Once you have your debt handled and begin to see your savings grow… you will understand that budgeting isn’t about restricting you from spending.

Every step you take toward financial improvement is a step toward financial freedom.

You're not just tracking dollars… you’re building peace of mind, reducing stress, and creating options for your future.

Start small… stay consistent… and eventually you can stop wondering where your money went… and instead tell it where to go.

You’ve got this.

Thanks for watching… and remember… there’s no wrong or right way to budget… you just have to find the way that works best for you.

Did you know your credit score could be costing you thousands of dollars without you even realizing it?

I’m Alvaro and in this video I’m going to go over what makes up your credit score… what hurts it… how to improve it… and how it can affect your finances.

Let’s start with the basics.

What actually makes up your credit score?

A credit score is a number between 300-to-850… given to a borrower… that gives lenders an idea of how much they can trust a debt to be repaid.

It's used when you apply for a mortgage, car loan or credit card… but it goes much further beyond lending… which I’ll explain later.

There are five key factors that determine your score:

• Payment history
• Credit usage
• Credit age
• Mix of credit
• And hard inquiries.

Now…your “payment history” is the biggest factor… making up 40-percent of the score.

This measures your on-time payments and any late or unpaid payments… regardless of the amount.

One missed payment can take two years to recover from… but recent payments matter more than older ones.

Once a debt is paid off or negative information is reported… it can stay on your credit report for seven-to-ten years.

Next… we have “credit usage” which makes up 23-percent of your score.

It measures how much of your available credit you’re using. 

Most experts say to stay below 30-percent usage.  This means if you have nine-thousand dollars of credit available to you, try to use three thousand or less.

If you max out your credit lines… your score will likely drop.

The next factor is your “credit age.”

It is the average of all open credit lines you have… and makes up 21-percent of your credit score.

Closing out long-standing accounts… or opening too many new ones will lower your overall average which in turn… can lower your score.

Moving onto your “mix of credit.”

This affects 11-percent of your score… and is based on the type of credit lines you have open.

The two most common are installment and revolving credit.

Installment loans are like mortgages or car loans… where you have a set payment amount for a specific length of time before it’s paid off. Such as a twenty-year mortgage or a car loan for 48 months.

Revolving loans are like credit cards or lines of credit… where you can add debt at any time and there’s not a set payoff date.

Having a mix of installment and revolving credit types is better for your score.

The last factor which makes up five-percent of your score is “hard inquiries”.

A hard inquiry is when a creditor checks your credit report because you have applied for a new credit line. 

Each hard inquiry will negatively affect your score…  regardless whether you are approved or not.

There is also what’s known as a soft inquiry… which does not hurt your credit. 

A soft inquiry is often used by landlords, insurance companies or potential employers to review your credit report… without actually applying for credit.

Now, let’s do a quick recap of what makes up your score:

Payment history is 40-percent

Credit usage is 23-percent

Credit age is 21-percent

Mix of credit is 11-percent

And hard inquiries make up the last five-percent.

Now that we know what makes up your credit and some actions that can hurt it… let’s answer the question: How do you improve it?

If you are just starting out and need to establish credit… you can apply for a low-interest rate credit card through a credit union.

Use that for small purchases like groceries or gas… and pay it off each month.

This shows creditors that you can be trusted to not over-spend and make your payments on time.

Paying it off in full… also saves you money by limiting the amount of interest that accrues.

If you need to repair or improve your credit… look into free financial coaching.

Ascentra credit union offers coaching services at all nine branches…

This service is even offered in spanish.

Our coaches do a soft-inquiry on your credit… so it doesn’t affect your score… then walk through the report to create a custom action plan.

Our coaches can also help with budgeting, debt reduction, long-term financial planning and more.

You can also use credit monitoring tools like savvy-money on the Ascentra app.

It allows members to view their credit report… and shows them where they’re doing well, where they can improve… and how.  This free service to ascentra members, has so much more to offer beyond

Don’t pay for credit services… and be aware of the fine print… you never know, some of these service could sell your information to third-parties.

Annual-credit-report-dot-com allows you to pull a full report once a year from each of the three credit reporting agencies… Transunion, Equifax and Experian.

Make sure to check for any inaccuracies… and if you find any… report them to the relevant credit bureau so they can be removed and not counted against you.

Consolidation loans through your credit union can help you in a number of different ways.

Consolidation let’s you combine multiple loans and/or credit card payments into one… offering a lower interest rate… helping you build your credit and save money.

Consolidations improve your payment history because one payment is easier to keep track of and pay on time… rather than several due dates throughout the month.

It helps your mix of credit by moving revolving credit to installment credit… and improves your credit usage by freeing up the credit lines the debt is moved from.

But it’s important to not use those credit lines again and go further into debt… fight any urge to use them by not carrying them around in your purse or wallet…just be sure to keep them in a safe place in your home… and remember that closing them will hurt your credit usage and your credit age.

Improvements should show on your credit report within a month or so…
and remember… more recent positive changes are much more important than negative impacts from the past.  Let’s look at a timeline that gives us the appoximate credit weight for each year. Because what you have done lately - both good and bad, carries more weight. 

Here's the break it down….40-percent of your score is based on what you’ve done in the past year… 30-percent is based on the prior 13-to-24 months and 20-percent on the prior 25-36 months.

That means 90-percent of your score is graded off of the past three years.

There’s no instant-fix to repairing your credit score… but with a little patience and work, mixed with some guidance… you can do it. 

But why should you do it?

Improving your score can make a big difference on your finances. 

Let’s say you’re looking to rent an apartment and the landlord conducts checks credit.

They may offer it to the person with the higher score… giving you less options for housing.

When you apply for a loan… a good credit score not only helps determine if you get approved… but also what interest rate you’ll get.

The higher the score you have typically means you’ll pay less in interest.

For something expensive like a mortgage… that can mean the difference of tens-of-thousands of dollars… say you plan on buying a home for 250 thousand-dollars and a bank promoting a 5.75% interest rate says you can qualify, but since you are not in the top credit bracket, your interest rate will go up to 6.75%. 

This is refered to as a “loan level price adjustment” – a policy that many lenders use that raises your interest rate or charges more fees.  Side note: ascenta does not punish people with “loan level price adjustments” on fixed rate mortgages– if you qualify for a mortgage, you get the best rate. 

Now, one percent may not sound like a lot, until you do the math.  For this example we will use the online caculator that lets you compare two mortgages.  We will keep it simple and not include closing costs and fees, and real quickly we see for a 30 year loan, that one-percent rate bump will cost you over 58-thousand dollars in the life of the loan. 

Imagine saving about 160 dollars every month for 30 years!!

Now, low credit scores can also increase your auto insurance premiums by as much as double the cost.

Research shows drivers with lower credit scores statistically have a greater likelihood of filing claims… which leads to higher rates.

(https://www.allstate.com/resources/car-insurance/does-credit-score-affect-car-insurance)

Essentially…  having a good credit score helps save you money… but it can also help you earn money.

Some employers do a soft inquiry of your credit before offering you a position…

So if you don’t have good credit… you could be limiting your job opportunities and the pay that comes with them.

(https://money.cnn.com/2013/08/12/pf/bad-credit/)

While your score can impact your earning potential… it’s important to know that how much you earn does not affect your credit…

Here are other factors that do not affect your credit score. 

A debt-to-income ratio compares how much money is coming in to what’s going out towards paying debt… and is one of the most common misconceptions about credit score influence.

There are many people that make a lot of money and have bad credit… and people who don’t make much money… living paycheck-to-paycheck… but have great credit.

The length of time you’ve worked at an employer… or how long you’ve been living somewhere also have no impact on your score.

all of these things may impact whether you qualify for a loan or how much a lender will offer… but have no bearing on your credit score.

Remember… the areas you want to focus on are your:

• Payment history
• Credit usage
• Credit age
• Mix of credit
• And hard inquiries.

Put in some time… some work… and remember… improving your credit score isn’t about perfection… it’s about progress…

And if you’re not sure where to start… ask for help.

Ascentra Credit Union is here to support you with tools, coaching and personalized guidance to help you reach your goals.

Your credit journey is just that… a journey… so take the first step… and keep moving forward.

Hello everyone, I’m Alvaro and I’m going to help you understand what sets credit unions apart from banks.

While banks and credit unions offer a lot of the same products and services like savings and checking accounts, credit cards, and loans… that is about all they have in common. 

The differences between banks and credit unions are their:

• Business structures
• Ownership
• And last, but not least, the mission.

In this video, I’ll dive a little deeper into these three areas to help make sense of the credit union difference. 

The biggest contrast between credit unions and banks is in the not-for-profit structure of credit unions. 

Most businesses generate revenue for their owners, investors, or shareholders. 

The more money a business makes, the better it is for the people at the top… but that usually comes at the expense of their customers. 

Banks are no different.

Profits from the loans and services they provide go to their owners or shareholders. 

Churning out dividends on a regular basis is top priority.

That may be great for the investors … but not necessarily the best thing for consumers.

“If customer service takes a hit … or fees and costs go up for customers … so be it! All in the name of profits!”

Now don’t get me wrong … I believe banks have a place.

However, they also actively lobby to get rid of credit unions to not only eliminate “competitors” … but eliminate a mission-driven industry that, quite frankly, keeps them fair.

We have seen headlines time and time again, where some banks resort to questionable and downright illegal practices in their quest for bigger profits.

Now if you wondered why I did “air quotes” when I said “competitors” … it’s because in the United States, banks own an astonishing 91-percent of deposits compared to a mere eight-percent for credit unions. 

Credit unions are really not competitors and banks are currently enjoying record profits … so what would compel them to target credit unions?

One word: greed.

The for-profit banking model also affects whether they open branches in certain areas … or even keep open branches located in areas they consider no longer performing to their standards.

In fact, according to the FDIC … NCUA … and America’s Credit Unions … since 2012 banks have closed more than 20,222 branches, while credit unions have opened 562 branches.

This has a devastating effect on the people who lose those jobs … and on the communities that become financial deserts.

In contrast, the credit union model does not put profits over service.

Credit unions don’t squeeze profits out of the organization to pay investors.

The profits are pumped right back into the organization for the benefit of the members.

Credit union members get less fees and lower interest rates on loans … and higher returns on their savings products. 

Credit unions also regularly rank higher in overall satisfaction on average compared to banks. 

Two recent J.D. Power studies showed that credit unions scored 74-points higher than the average bank in satisfaction scores. 

Credit unions are popular with the average American who needs basic financial products… and even those seeking wealth building services.

That is why 142-million American consumers are credit union members. 

Credit unions are governed by a board of directors who are all members of the credit union … most of them are volunteers.

Board members are democratically elected by the membership to provide oversight and guidance on the general direction of the credit union. 

Any member can run for a board seat … regardless of how much money they have in their accounts.

So, if you’re not happy with the direction of your credit union, you can run to join the board or at the very least, vote for those who are keeping the organization accountable. 

This helps credit unions stay responsive to their communities and their members.  

Credit unions are also limited to serving members who have a common bond. 

A credit union’s “field of membership” determines who is eligible to become a member.

The restriction usually applies to people who:

• Live in a certain region…
• Work for a certain employer or industry sector…
• Or even if they are part of the military. 

For example, there are federal credit unions that provide membership for federal workers and their families … while smaller credit unions might just service a specific region or town.

You can think of them as “exclusive” … but just about every American can join a credit union.   

At Ascentra, our field of membership is open to people who live or work within 21 counties in Eastern Iowa and Western Illinois.

While some may see this as a limiting factor, credit unions consistently punch above weight when competing with large national banks by working together to help provide service to all their members in very unique ways.

Cooperation among cooperatives – this is actually one of the principles of cooperatives – which is exactly what credit unions are. 

Cooperatives are organizations that are owned and ran by their members to meet the common needs of the membership. 

Many credit unions partner with each other to allow their members to mutually benefit.

One example of that cooperative spirit is the shared branch network … a service that lets you have a membership at a credit union in Bettendorf, Iowa … but go to college on the other side of the country without worrying about having access to your accounts.

Shared branching allows members to walk into any one of over 56-hundred credit unions across the country to make withdrawals, transfers, or loan and mortgages payments.

If you’re a snowbird or maybe on spring break in Florida … Orlando credit union can do business for Ascentra members … and we can do the same for their members at our shared branches.

Credit unions also give back to their local communities.

As not-for-profits, credit unions have a tax-preferred status … which means we pay all taxes except for federal corporate income tax.

The tax savings and credit union profits are used to offer better rates and services to our members… and reinvest in the community by:

• Funding local programs
• Teaching financial wellness
• Partnering with charitable organizations
• Helping members going through hardships
• Volunteering… and more.

This has proven to be a great investment for taxpayers.

Many studies show high returns for millions of credit union members and the overall economy. 

For years… bank lobbyists have been trying to have credit unions’ tax status taken away … but that would not only affect credit unions … but the people we serve. 

It would cost our members more money … and hurt our ability to make a community impact … which is deeply engrained in why credit unions exist in the first place.

Our guiding philosophy is “people helping people.”

This has been the mission since day one!

Credit unions were born because people of modest means were turned away by banks … and being preyed upon by loan sharks.

They came together to lend each other money … to help each other grow and be successful.

They created cooperatives … the early credit unions.

Those issues are still happening today.

Many banks don’t offer small consumer loans or help people with lower credit scores … leaving them to turn to payday lenders or pawn shops. Credit unions step in to fill that gap.

Plenty of credit unions have a similar story. 

A group of people who had an employer, church, or organization in common and were fed up with unresponsive banks and took control of their finances. 

For Ascentra Credit Union, it began in 1950 with a group of union employees working at the Alcoa Davenport works plant. 

They organized and created Alcoa employees credit union … with some of the earliest loans being used to help buy coal to heat their homes … or help put a down payment on a house. 

Today, the credit union serves more than 40,000 members and manages more than 556-million dollars in assets.

It’s also grown to nine branches located in Bettendorf, Clinton, Davenport, and Muscatine, Iowa, and Moline, Illinois.

The efforts to help people going through hard financial times has also multiplied.  

At Ascentra, we partner with organizations to provide financial wellness for people of all walks of life.

We’ve even created a foundation to ensure that even in tough economic times, we are still able to give back. 

We don’t just write a donation check.

We foster relationships with area changemakers and organizations who align with our mission … those who amplify our beliefs of listening, caring and doing what’s right.

That goes beyond just helping people get a loan.

It’s the way we carry ourselves and how we help others in our community.

So, what’s the credit union difference?

It’s simple … credit unions work to improve our communities because we work for and are owned by the people in our communities.

We will continue to grow and evolve to meet the needs of our members … because the credit union difference is the core of everything that we do

What is a down payment? 

A down payment is the initial cash you put down when you are buying your home. It represents a percentage of the total purchase price, and the buyer will often take out a mortgage loan to finance the remainder.

With a larger down payment, the buyer needs to borrow less, monthly mortgage payments are lower, and less is paid in interest over the loan term.

At Ascentra, a fixed-rate home loan requires a minimum 5% down payment and a first-time homebuyer adjustable rate mortgage loan requires a 3% down payment.  To avoid paying private mortgage insurance, a down payment of 20% is needed. 

The down payment funds can come from a variety of sources.  Oftentimes, people use assets like savings or retirement accounts.  Additional sources for funds include gifts from family members, grants or secured borrowed funds.  

Help may also be available in the form of down payment assistance programs.  At Ascentra, we offer a $7500 first-time home buyer grant for qualifying individuals.*

All down payment funds require documentation.  We want to make the process as simple as we can.  We are here to guide you and make sure your home buying experience is as smooth as possible.

We are your mortgage experts.      

Should I refinance?

This is a very good question, especially if rates are low!

The general rule of thumb is that if you can save at least one point in interest (for example lowering it from 4% to 3%), you can definitely save money in interest.  And often times, you can lower your payment or even the term of the loan down from, say, 30 years to 15 or even 10.

But while that may be a general rule, the most important question is “What is YOUR goal?”  

Some reasons you might want to refinance are

• To save money each month with a lower payment.
• To pay off your loan sooner by shortening the term of the loan.
• To consolidate other debts into one easy monthly mortgage payment.
• To borrowing against your home’s equity to make improvements or upgrades to your home.

Or maybe you are just unhappy with your current lender because your loan is constantly moving from one investor to another.  That won’t happen at Ascentra because we service all of our loans locally.  So when you need assistance WE will be here to help.

At Ascentra, we are your mortgage experts.

What is Escrow? 

An escrow is essentially an account that holds funds for your annual taxes and homeowners insurance throughout the year.  With each monthly mortgage payment you make, money is held in an account by the lender, then those funds are used to make your annual property tax payments and home owners insurance payments on your behalf.

When you escrow the lender will add 1/12^th of your insurance premium and 1/12^th of your tax bill to your monthly payment, so the lender has enough set aside to pay the bills when they are due.

It is important to know that escrow accounts are regulated, and all lenders are required to follow the same rules.  If you are purchasing a home and have less than a 20% down payment or you have less than 20% equity when you refinance, lenders require you to escrow your taxes and insurance as a part of your monthly payment.  If you are putting down at least 20% or have at least 20% equity on a refinance, you have the choice if you want to pay your taxes and insurance on your own. At Ascentra we do not require you to escrow in this situation, it is entirely up to you.

Annually our escrow department will do an escrow analysis, which includes new insurance premiums, new tax rates, and a 2-month cushion that is allowed by the government. We then calculate your new monthly payment based on those factors. 

Your mortgage payment may go up or down year to year depending on changes to your property taxes or insurance rates. 

If your escrow comes up short for any reason, you have the option to pay any shortage or you can finance that amount out over the next 12 months of mortgage payments.

At Ascentra, we handle all of our loan servicing in house, so if you ever have any questions, we are here to help.  We are your mortgage experts.

What is PMI?

PMI is short for private mortgage insurance. PMI is insurance required on mortgage loans for borrowers in two specific situations.

If you don’t submit a 20% down payment when purchasing a home, PMI is required.

OR If you don’t have 20% equity in your home when you are refinancing, PMI is required.

PMI is not homeowners insurance. Private Mortgage Insurance actually protects the lender in the instance that you stop making payments on your loan. The cost of PMI is included in your monthly mortgage payment.

You can request to stop PMI once your reach 20% equity in your home.  These requests are evaluated based on your payment history.  PMI is automatically canceled once you reach 78% equity in your home.

It is always a good idea to read your mortgage statement and be aware of the amount of equity you have in your home, since stopping PMI can save you money each month.

Here at Ascentra, members receive letters annually letting them know the percentage of equity in their home. This makes it really easy to track when you can cancel your private mortgage insurance.

At Ascentra, we handle all mortgage servicing in-house.  So if you have questions, we are here for you.  We are your mortgage experts.