Not a huge difference from a secured loan or card for that matter.
Would have to be weighted at manual review as it will either be reported as a secured loan, installment loan or consumer finance loan (unlikely as you aren't purchasing an item). For fico scoring there's only so many categories that can be listed on a CR.
So to answer, no. Unless manually reviewed, even then there are thousands of products on the market it's narrow minded to think they would even know of this product. Analysts have better things to do than follow every product available to consumers let alone every new product and company. They are only concerned with the payment history.
Would have to be weighted at manual review as it will either be reported as a secured loan, installment loan or consumer finance loan (unlikely as you aren't purchasing an item). For fico scoring there's only so many categories that can be listed on a CR.
So to answer, no. Unless manually reviewed, even then there are thousands of products on the market it's narrow minded to think they would even know of this product. Analysts have better things to do than follow every product available to consumers let alone every new product and company. They are only concerned with the payment history.
Will still have to maintain the discipline to make on time payments for the loan term. This will establish that the consumer can maintain that and has some disposable income aswell as they would be without that cash for the year or whatever the terms are.
I see secured loans as much of a BS product as this. If you defaulted on a secured card will they forgive you as they already have the cash to settle the account? Nope, you need to pay it off. Same with secured loans.
This is really the same as those products, just gives another way of doing it.
This is not 100% consumer friendly, if you defaulted I suspect you lose all your money. I don't consider that much of a savings account.
I see secured loans as much of a BS product as this. If you defaulted on a secured card will they forgive you as they already have the cash to settle the account? Nope, you need to pay it off. Same with secured loans.
This is really the same as those products, just gives another way of doing it.
This is not 100% consumer friendly, if you defaulted I suspect you lose all your money. I don't consider that much of a savings account.
@DaveInAZ wrote:
@TheGardner wrote:
Not a huge difference from a secured loan or card for that matter.
Would have to be weighted at manual review as it will either be reported as a secured loan, installment loan or consumer finance loan (unlikely as you aren't purchasing an item). For fico scoring there's only so many categories that can be listed on a CR.
So to answer, no. Unless manually reviewed, even then there are thousands of products on the market it's narrow minded to think they would even know of this product. Analysts have better things to do than follow every product available to consumers let alone every new product and company. They are only concerned with the payment history.Perhaps not a 'huge' difference, but a significant one - for a secured loan or card you have to have the money up front, deposited into the lender's account, this is monthly payments deposited into an escrow account which you get back. And it's difficult to tell the difference between a secured loan or card as the same creditor offers secured & unsecured loans/card, while this is the only product of this company. And I would think the CRAs & lenders would take this as challenge, an attempt to "game" the system - your monthly payments into a savings account are getting reported as a "payment" on a "loan" which really doesn't exist.
I sure wouldn't be an investor in this company - all it would take is a ruling that this is improper credit reporting that the CRAs must ignore, and their entire business model goes down the drain.
DCU and others have done what I've seen referred to "Credit Builder" loans, where they stuff $1K into a bank account you can't touch, and then you make monthly payments on the loan and you get the 1K after the loan period is done.
I think that accomplishes everything this site does honestly. The advantage to a secured loan is you have a lot more flexibility on term and usually lower APR.
@Anonymous wrote:I just signed up and SelfLender says they show up as an installment loan on the report. Also, it's coming from an Austin Bank, so there's no reason for it to look fishy. The credit report will just show the name of the Austin bank, not say "Self Lender" loan.
This is an old thread, the best way we have found to date regarding tacking on an installment loan to improve one's credit report (assuming one does not have current installment loans open) is the following:
Method:
http://ficoforums.myfico.com/t5/Understanding-FICO-Scoring/Adding-an-installment-loan-the-Share-Secure-technique/m-p/4506756#U4506756