Building Credit, Building Confidence: A Conversation with Carter Bank’s Karen Tilley

For many individuals and families, the dream of homeownership begins long before touring homes or applying for a mortgage. It often starts with something more foundational: understanding and building credit.

Financial Pathways of the Piedmont sat down with Karen Tilley, Branch Manager of Carter Bank’s Stratford Road office in Winston-Salem, to discuss why credit matters, how people can begin building or rebuilding it, and what steps can help them become more financially confident and prepared for the future.

Karen brings 27 years of banking experience to her role and says the most rewarding part of her career has been building relationships and helping people.

“I like helping people,” Karen shared. “In this job, you get to help people. And it’s very fulfilling every day to know you’ve helped someone.”

Carter Bank may be newer to Winston-Salem, but the bank itself has been serving communities for more than 50 years. Since opening its Winston-Salem location a little over a year ago, Carter Bank has already become an active community partner, supporting financial education, Financial Pathways’ Center for Homeownership, Homebuyer’s Club initiatives, and other community-based programs.

Why Credit Matters

For someone hoping to buy a home one day, Karen says strong credit is an important first step.

“Strong credit increases your chance of being approved for a mortgage,” she explained. 

A higher credit score can signal lower risk to lenders, which may make it easier to qualify for a mortgage. It can also help borrowers access better interest rates, stronger loan terms, and more options.

“The better your credit is, the better options you have,” Karen said.

Clearing Up Common Credit Myths

One common myth Karen hears is that checking your own credit score will lower it. Fortunately, that is not true. When individuals check their own credit, it is considered a soft inquiry and does not hurt their score.

Another misconception is that carrying a credit card balance helps build credit. Karen clarified that people do not need to carry debt month to month to improve their credit.

“You do not have to carry a balance to build your credit,” she said. “What matters most is your on-time payments and keeping that credit utilization low.”

Credit utilization refers to how much of your available credit you are using. Karen recommends keeping credit card balances below 30% of the available credit limit.

She also shared another fact that surprises many people: income does not affect your credit score.

“Your income has nothing to do with your credit score,” Karen said.

Instead, credit scores are based on factors such as payment history, credit utilization, length of credit history, and the types of credit a person has used.

Building Credit Through Steady Habits

When it comes to improving credit over time, Karen’s advice is simple but powerful: pay every bill on time, every month.

Payment history is one of the most important factors in a credit score. Karen often recommends setting up automatic payments when possible so bills are not missed.

She also emphasized the importance of keeping credit card balances low and keeping older accounts open when possible.

For individuals with little or no credit history, Karen shared several safe ways to begin building credit. One option is a secured credit card, where the borrower provides a refundable deposit that becomes the credit limit. By making small purchases and paying the balance off each month, they can begin building positive payment history.

Another option is becoming an authorized user on the credit card of someone trusted, such as a parent or family member, who consistently pays their bills on time.

Preparing for Homeownership

When someone is preparing to apply for a home loan, Karen recommends reviewing and working on credit at least six to 12 months before applying.

Sometimes negative items appear because of unexpected or overlooked issues, such as an unpaid medical bill or a final bill from a utility or cable provider. Reviewing credit early gives people time to identify errors, address collections, and make improvements before meeting with a lender.

Credit Can Be Rebuilt

For those who feel discouraged because their credit is not where they want it to be, Karen offered an encouraging reminder: credit is fixable.

“Your credit score, just because it’s 600 today, it’s not permanent,” she said. “You can do things to fix it and make it go up.”

The key is consistency. Paying on time, reducing credit card balances, checking credit reports, and building strong financial habits can create progress over time.

“Be committed to the journey that you’re on to wanting to improve your credit,” she said.

When Life Happens, Reach Out

Karen also emphasized the importance of asking for help early when financial hardship happens.

During the conversation, she shared a story about helping a couple who were at risk of foreclosure after the husband became seriously ill with cancer. Because they reached out, Karen was able to work with them and help them keep their home.

Her message to others facing financial challenges is clear: do not wait, and do not assume there are no options. Karen suggests borrowers reach out and talk to your banker. Talk to your lender. Let us help guide you in the right direction.  

Financial Pathways of the Piedmont also provides housing counseling, including default and foreclosure prevention counseling, to help individuals understand their options and communicate with lenders.

“If you’re behind, reach out,” Karen said. “We want to have a conversation. We’re not here to judge you. We know life happens.”

The Role of Banks as Community Partners

Karen believes banks and community organizations both play an important role in helping families move toward financial stability and sustainable homeownership.

That starts with financial education: helping people understand credit, budgeting, mortgage readiness, and the homebuying process before they meet with a lender.

“It’s getting out there early, educating early,” she said.

Carter Bank is also working to support financial education for young people, including youth banking options that help children begin learning money management skills earlier in life.

Not everyone grows up with access to financial education. That is why partnerships between banks and organizations like Financial Pathways are so important. Together, they can bring trusted information, practical tools, and encouragement directly into the community.

The Key Takeaway: Start Early and Stay Consistent

If readers remember one thing from the conversation, Karen hopes it is this: “credit and homeownership readiness are built through steady, intentional habits.”

Building credit is not about perfection. It is about progress. Whether someone is just starting out, rebuilding after financial challenges, or preparing for homeownership, each positive step matters.

At Financial Pathways of the Piedmont, we believe financial well-being is possible with the right education, support, and tools. Through partnerships with community-focused institutions like Carter Bank, individuals and families can gain the knowledge and confidence they need to move toward stability, opportunity, and future homeownership.

Learn more about Carter Bank on their website: www.carterbank.com, or visit Karen at their branch on Stratford Rd. in Winston-Salem.