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Regular Contributor
kims
Posts: 212
Registered: ‎06-30-2007
0

Credit Builder Loan

DH and I went to our credit bureau this morning and got their credit builder loan.  It's $1000 to be paid back in 12 months.  The loan is deposited into our savings account and frozen for a year.  We make bi monthy payments of $46.  At the end of the year they release the 1000 to us.  Interest rate was a little over 6%.  They report to all 3 credit bureaus and said it would appear as a "revolving" account on our CR.  Basically I guess we're "buying" our credit.  It'll cost us a little under $200 to have this loan and build a good history with our CB along with hopefully pushing our FICO up a bit.
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Frequent Contributor
chartley3
Posts: 488
Registered: ‎05-23-2007
0

Re: Credit Builder Loan

That is interesting. This almost sounds like what some companies did with the buying your way as an AU that FICO just slammed the door on.
Regular Contributor
kims
Posts: 212
Registered: ‎06-30-2007
0

Re: Credit Builder Loan

[ Edited ]
 
 
~nevermind..I figured it out! lol 
 
But how do you liken being an AU to actually having a loan from a legit lender? 


Message Edited by kims on 07-13-2007 01:21 PM
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Frequent Contributor
chartley3
Posts: 488
Registered: ‎05-23-2007
0

Re: Credit Builder Loan

Because you dont have access to the actual money until you pay off the loan. I understand the concept but to me its like applying for a Line of Credit and I cant touch it until I pay the lender X amount of money.
Established Contributor
myhearts07
Posts: 858
Registered: ‎06-26-2007
0

Re: Credit Builder Loan

Lasalle Bank has that same loan program for rebuilding credit with a prime lender.  
 
 
Regular Contributor
kims
Posts: 212
Registered: ‎06-30-2007
0

Re: Credit Builder Loan

I kinda see what you're saying...we didn't find out until we got to the CU that it would be frozen in our savings.  I can think of alot of things I could have done today with an extra $1000 but that mentality is part of the reason I'm where I'm at today with my credit.  It's a good lesson for DH and I ~ we need to learn to leave money sitting sometimes.  I came from a family that would blow and go and never learned how to be financially responsible.  So..there that 1k sits and hopefully in 1 years we'll be a little wiser on how it's spent. :smileyhappy:
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