Consumer Watch: Free credit scores for troops - Military Money, Navy Money, navy pay, pay charts - Navy Times

Consumer Watch: Free credit scores for troops

Keeping an eye on your credit reports and credit score is important to your financial health — and it just got easier.

Active-duty service members, mobilized reservists and their spouses can get free FICO credit scores, as well as the information and tools offered by FICO Standard Service, provided by the Financial Industry Regulatory Authority’s Investor Education Foundation.

The tools, which usually cost $19.95 per credit score, will be available throughout 2011 and probably beyond — currently, there is no end date for the offer, said Gerri Walsh, vice president of investor education for FINRA.

The Fair Credit Reporting Act guarantees everyone access to three free credit reports a year, one from each of the national credit reporting agencies, at www.annualcreditreport.com.

FINRA goes beyond that and provides the FICO score, which is compiled using information from those credit reporting agencies. This is the score used by most banks and lenders to decide whether to loan you money, and at what interest rate.

“We want to facilitate improving credit scores and understanding how changing critical behaviors can improve their scores,” Walsh said.

That’s particularly important for service members who may be in financial trouble, which may put their security clearances at risk.

In addition to seeing what their FICO score is, service members and spouses can use the FICO Score Simulator to analyze the effects actions can have on their credit score, such as declaring bankruptcy, paying off a credit card, opening a new account, getting a car loan or missing a payment.

To get access to the FICO score and other services, contact your personal financial management program office at the nearest installation. You can find contact information at www.militaryinstallations.dod.mil. Search by installation or ZIP code.

If you’re not near a military installation, email creditscore@finra.org.

Bank of America has announced new programs for its military mortgage customers.

Like JPMorgan Chase, Bank of America will reduce interest rates on pre-service mortgages to 4 percent, going beyond the 6 percent minimum required under the Servicemembers’ Civil Relief Act. The 4 percent rate will apply for the period of the borrower’s active duty and for 12 months after release from active duty then it reverts to the borrower’s previous rate.

This benefit is for those eligible under SCRA — those who have mortgage debt that was incurred before entering active duty.

The SCRA requirement to reduce interest rates to 6 percent applies to all loans entered into before active duty, but this voluntary 4 percent cap applies only to mortgage loans, said Bank of America spokesman Rick Simon. Interest rates on SCRA-protected credit cards and other loans remain at 6 percent.

The 4 percent rate on SCRA-protected mortgages starts with April mortgage payments, said Bank of America senior vice president Eric Telljohann. For now, it applies only to customers with mortgages owned by Bank of America, and not necessarily to mortgages that are serviced — but not owned — by the bank.

“We will solicit those owners for the mortgages we service to participate, but we can’t mandate it,” he said.

Other programs being introduced include:

• A customer service team for service members with Bank of America mortgages. The phone number is 888-325-5357.

• The Military Loan Modification Program, for Bank of America military customers who are leaving active duty and struggling to make their mortgage payment. Solutions may include forgiving part of the amount owed on the mortgage, reducing the loan to as low as the current market value of the home.

As needed, the bank may take extra steps, such as reducing the interest rate and extending the term of the loan to make it easier for customers to afford payments.

This applies only to those leaving active duty, and only to loans owned by Bank of America, Telljohann said. For service members who must relocate because of military orders, no extra help is available at this time, he said.

Questions or comments? Email staff writer Karen Jowers at kjowers@militarytimes.com.