Financial Modeling of the Cost of Poor Credit in Massachusetts
Client
United Way of Massachusetts Bay and Merrimack Valley
Faculty
John Ceffalio
Team
Yujing Chen, Melissa Mayer, Haojun Qiu, Peter Relyea, Jingyi Wang
| The United Way of Massachusetts Bay and Merrimack Valley (United Way), a social services organization providing community programming, is launching a credit building initiative called Boston Builds Credit (BBC). BBC aims to help 25,000 residents achieve prime credit scores by 2025. In Boston, over 50 percent of the population has either low or no credit, subjecting them to higher interest rates and fees on important expenses. The United Way engaged a Capstone team to assess the costs of having low or no credit at the individual and the city levels. The team conducted financial modeling, interviews with experts, and extensive research, concluding that poor credit costs $200,000 more in fees over a lifetime. The team also measured the impact of BBC by calculating the savings generated when individuals improve their credit scores. |
Focus Areas
Capstone Year