Cars & Credit Cards: How Zakiya increased her credit score

When Mission Asset Fund announced that it was seeking new Lending Circles providers for the Better Bay Area Initiative, the opportunity jumped out to us. Game Theory Academy’s Make Your Decisions Count course teaches youth the basics of building good money habits, helps them gain confidence in navigating the economy, and provides exercises for thinking strategically. Lending Circles gives youth a way to practice all of these financial decision-making skills in real life, while improving their credit score.

bobOur first six Lending Circle participants named their group Bob the Credit Builder. They each contributed $75 monthly for 6 months, and each month the $450 “kitty” was deposited into one participant’s bank account. The group held a kick-off meeting to negotiate who would get the distribution each month, based on their needs and preferences for the duration of their Lending Circle. Long-time GTA participant Zakiya was the first to receive the $450 distribution.

Zakiya started college in August and devoted that $450 to school expenses. Kiya says she would never have been able to set aside this amount of money without the “pressured saving” that Lending Circles provides. Years ago, she realized the consequences of having maxed out her credit card multiple times when she tried to buy a car and the dealer requested a 50% down payment plus a co-signer. Now that she works at a wireless company, she sees this from the other side and has had to deliver a similar message to customers with poor credit scores. We are happy to report that Kiya’s credit score improved 80 points after completing her Lending Circle. Kiya is optimistic that her credit score will soon be high enough to qualify for an auto loan and finally buy that car!