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Secured Auto Loan

New Member

Secured Auto Loan

I have very bad credit but needed a new car. I had enough cash but wanted the credit history so I used $30,000 of my savings for a secured auto loan from my credit union.

My question is, does this report any differently than a conventional auto loan? When I pull my report it shows "secured loan" instead of "auto loan". My scores actually fell an average of 14 points when it started reporting 4 months ago but have since gone right back to where they were preloan.

My scores. :

Exp 535
TU. 582
EQ.630
7 REPLIES
Moderator Emeritus

Re: Secured Auto Loan

Actually it does help your score in the same way that an auto loan would... and you get the history at a cheaper rate..

 

I did a secured loan back in 2007 and it helped my score tremendously


Starting Score: 08/29/2011 TU 671 EQ 674
Current Score: TU 754 EQ 694 EX 697
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Moderator Emeritus

Re: Secured Auto Loan

Actually, if you have a little bit of cash to spare, you should also consider opening a couple of secured credit cards if you haven't already


Starting Score: 08/29/2011 TU 671 EQ 674
Current Score: TU 754 EQ 694 EX 697
Wallet: NFCU Visa Sig 25k, Amex Lowes 22k, NavCheck 15k, Amex PRG, Amex Zync, Discover It 13.5k, Amazon Visa 5k
Platinum Spade Garden Club Member: App Free since 1/1/13. No more apps til who knows when?
MyFICO Fitness Goal: 800s Club!



Take the myFICO Fitness Challenge
New Member

Re: Secured Auto Loan

I just did a $3000 secured capital one, but unfortunately I then went on an extended out of town trip and put just over $2000 on it. As soon as I got back, I paid it off. Still hoping it doesn't show it.

I have been contemplating trying a secured mortgage for a small condo, just like the car. But I am too ashamed to go ask.

And your scores look fantastic!
Regular Contributor

Re: Secured Auto Loan

Very good choice to do the secured auto loan, very valuable towards building that auto history and credit all-together! My only concern with such a loan is that are they securing your loan with BOTH you money and the car or just the cash itself. I suppose that it would just be the cash but make sure you read the fine print on that!

 

Anyway congrats on the new car!Cat Tongue

Age: 22 //Cards: Chase Freedom, Chase Amazon Visa, Discover IT, CreditOne, CapOne Quicksilver, CapOne Cash, Walmart, Barclaycard, Citibank BestBuy, NavyFederal Visa Signature cashRewards //AAoA: 1 Year 3 Months (but going down quickly Smiley Tongue) //CK:692, Sesame:656
New Member

Re: Secured Auto Loan

Thank you!

My car has a clear title. The savings is the only security on the loan. Each payment they decrease the amount of the hold on my savings.

It is hard for me to not double up on my payments, but I want the full 5years on my credit history.
Regular Contributor

Re: Secured Auto Loan

That's what I figured, so a secured loan that reports as a car loan, pretty boss if you ask me Cat Very Happy

Age: 22 //Cards: Chase Freedom, Chase Amazon Visa, Discover IT, CreditOne, CapOne Quicksilver, CapOne Cash, Walmart, Barclaycard, Citibank BestBuy, NavyFederal Visa Signature cashRewards //AAoA: 1 Year 3 Months (but going down quickly Smiley Tongue) //CK:692, Sesame:656
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Valued Contributor

Re: Secured Auto Loan

Now that you have this positive history on the secured loan. Next time do a large down payment instead. The car/condo should be good collateral with a large down payment.

 

For example: $50k car put $25k down and still get a good rate.

 

 

Too many INQs & low AAoA so I'm off to tend the Garden.     Age:23    


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