topic Re: Alliant Secured Loan in Credit Cards

Alliant Secured Loan

Creditaddict — Fri, 08 May 2009 19:26:45 GMT

Opened my Alliant Secured loan today, the analyst I talked to about getting a credit card said I would need to build some history with them before they would approve it and the best way to do that was to put money in the account each month and open a secured loan.

To my surprise though the loan is for 3 months!!

$500 for 3 months, it's like $170 a month.

So we will see in 3 months if that is enough time to get me a credit card with them, that's my goals

Re: Alliant Secured Loan

Anonymous — Fri, 08 May 2009 19:38:50 GMT

I started a thread in General Credit about the same thing. I had to do a double take when looking at the subject line, it said the exact same thing Anyway I am going to do the same thing with the secured loan. My ultimate goal is to get a CC with Alliant. I am not sure how much of a secured loan I want to take out though. I have up to $8000.00 to put but not sure if that much is necessary? Did you call and talk with Alliant about the loan or just apply online?

Re: Alliant Secured Loan

Creditaddict — Fri, 08 May 2009 19:42:06 GMT

I did it over the phone.

omg $8000, I say if you have it, use it because if you can handle that kind of loan payment then surely in a few months they are going to say yes this person can not only handle a credit card but handle more than a $500 CL.

When Bank of America sends me my $1000 back next week, I'm going to open another loan at alliant with it just to ensure they see me handling things

Re: Alliant Secured Loan

Anonymous — Fri, 08 May 2009 19:49:41 GMT

My wife is a real saver. After our BK in 04 she kept putting little bits of money in her SD. She never told me about it. She had saved about $10,000 in five or six years. A couple of months ago some houses in our area were getting broke into and she got scared and told me about the money. Can you believe $10,000 in small bills. It filled up two or three socks.

I need to pay more attention.

Re: Alliant Secured Loan

Creditaddict — Fri, 08 May 2009 19:52:43 GMT

Thats fantastic.

I have tons and tons of debt but after being on the Suze Orman show I have started to save, it's not much right now because of how much I'm paying in debt, but it was nothing before, it feels good to see a little bit each month going into another account and earn some interest. and Alliant at 2.47 isn't all that bad!

Re: Alliant Secured Loan

Anonymous — Fri, 08 May 2009 19:55:51 GMT

@Anonymous wrote:
My wife is a real saver. After our BK in 04 she kept putting little bits of money in her SD. She never told me about it. She had saved about $10,000 in five or six years. A couple of months ago some houses in our area were getting broke into and she got scared and told me about the money. Can you believe $10,000 in small bills. It filled up two or three socks.

I need to pay more attention.

That you do need to do......but your wife seem very smart. Thinking for the both of yous.... BUT get that money outta there... I can't stand theives.

Re: Alliant Secured Loan

Anonymous — Fri, 08 May 2009 20:00:33 GMT

@Anonymous wrote:
@Anonymous wrote:
My wife is a real saver. After our BK in 04 she kept putting little bits of money in her SD. She never told me about it. She had saved about $10,000 in five or six years. A couple of months ago some houses in our area were getting broke into and she got scared and told me about the money. Can you believe $10,000 in small bills. It filled up two or three socks.

I need to pay more attention.
That you do need to do......but your wife seem very smart. Thinking for the both of yous.... BUT get that money outta there... I can't stand theives.

Yea, even after our BK she learned her lesson and she knew I had not. She's the type of person that would rather have nothing at all and money in the bank as oppossed to me who likes to spend. I thank God every day for a wife like that (now if she could only learn to cook)! JK

Re: Alliant Secured Loan

Anonymous — Fri, 08 May 2009 20:01:51 GMT

By the way, the money is safe and sound with Alliant.

Re: Alliant Secured Loan

Anonymous — Fri, 08 May 2009 21:05:19 GMT

@Anonymous wrote:
By the way, the money is safe and sound with Alliant.

Thanks great to hear champ....

Take Care and be safe

Re: Alliant Secured Loan

Anonymous — Fri, 08 May 2009 22:22:41 GMT

dizduster asked a similar question about savings secured loans. He had $8k in savings and was worried if he borrowed against the whole amount his entire savings would be "tied up" and unavailable for necessary uses.

http://ficoforums.myfico.com/fico/board/message?board.id=generalcredit&message.id=129266#M129266

Here is a copy from my response there:

Hey diz - how's it going.

Well, I have a few ideas on your question (don't I always )

1. Alliant is a great CU. I heartily recommend them.

2. A secured loan is a FANTASTIC way to build a relationship.

3. You are not correct on your thinking for amount. If you use the entire amount of savings for the loan, you tie NOTHING up, because they give you $8000 cash from the loan. So yes, the savings is "tied up" as collateral, but the loan proceeds are not.

4. Borrow $8000 against your savings.

5. Deposit the loan proceeds into your savings account, giving you $16,000 in savings now

6. Have your payments for the loan "auto drafted" from the savings account.

7. Make a few payments, then pay the majority of the loan down (transfer from savings balance) to reduce interest charges.

8. Pay the loan off in 12 months so that you get a CR TL with 12 months payment history, then a "paid as agreed"

9. The interest charged is nominal (2-3% above what you are collecting on the savings, and you are collecting on $16,000 while paying on $8000 which declines....so the interest you collect will pretty much pay the interest charges accrued.)

10. Talk to a LO about a credit card 6 months into the loan.

Well, that's my $0.02

Message Edited by txjohn on 05-08-2009 03:22 PM

Re: Alliant Secured Loan

Creditaddict — Fri, 08 May 2009 23:00:39 GMT

well Alliant sends you a check out immediately for the secured loan amount. So actually you will have 16k!

8k is locked in your savings account charging you like 4. something interest and you will have a check for 8k that you could put somewhere else to use as you wish.

I'm taking my check and putting it into an account I don't use to make the loan payments back to the secured loan

Re: Alliant Secured Loan

Anonymous — Fri, 08 May 2009 23:05:18 GMT

@Creditaddict wrote:
well Alliant sends you a check out immediately for the secured loan amount. So actually you will have 16k!
8k is locked in your savings account charging you like 4. something interest and you will have a check for 8k that you could put somewhere else to use as you wish.

I'm taking my check and putting it into an account I don't use to make the loan payments back to the secured loan

That's exactly what I explained. I suggested putting the loan proceeds back into savings so that you are collecting interest on DOUBLE the amount of the loan (collecting on $16, only paying on $8k which declines with payments). So, the interest earned will exceed the interest paid.

Have the payments "auto drafted" from the savings account for more convenience and pay the loan off at 12 months.

Message Edited by txjohn on 05-08-2009 04:05 PM

Re: Alliant Secured Loan

Creditaddict — Fri, 08 May 2009 23:06:01 GMT

ya my bad i read your whole post after i posted... lol

Re: Alliant Secured Loan

Anonymous — Fri, 08 May 2009 23:27:44 GMT

Thanks txjohn and creditaddict,

We just transfered the money into Alliant yesterday and it takes 3 days to post from another bank account so it probably wont post until early next week. As soon as it posts we will apply for the secured loan. Wife only wants to put 6k into savings and use for the loan, we have a vet bill that needs to be taken care of.

So 12 month term would be best? I probably will just turn right back and deposit the money right back into my Alliant savings as it earns such a good rate. Hopefully like txjohn said, we can apply for a cc in six months or so.

Re: Alliant Secured Loan

Anonymous — Fri, 08 May 2009 23:36:43 GMT

Explain to wife that when you "use" $6k for the "loan" you get the $6k loan check back. So you will have the $2k you kept in reserve plus the $6k you borrowed. I would throw it all into savings so that your interest "earnings" exceed your interest payments. Just transfer out what you need for vet, etc. as you need, and leave in savings to earn interest in the mean time.

I would go the full $8k myself. It gives you a "larger loan" meaning more credibility later and possibly higher CC CL. And again, you get the whole $8k back from the loan. No actual money is tied up. You put $8k in savings, then take it back out in the loan. You have EXACTLY the same amount of discretionary cash. And when you put the check you get from the loan back into savings.....you got $16k in there now.

Not trying to be redundant....I just wasnt' sure if my previous post was clear. I had a friend that I had to explain this to about 10 times before he caught on. He kept thinking that whatever he "secured" for the loan was money he lost access to and would be without discretionary cash. The light finally went on about the 9th or 10th time I actually had to get a white board out and draw it out for him.....

Re: Alliant Secured Loan

Anonymous — Fri, 08 May 2009 23:46:34 GMT

I actually had to get a white board out and draw it out for him.....

Story of my life!

Thank you for explaining it though. Now I just have to repeat it verbatum to my wife ( it's her money after all). I will do the whole amount (wife permiting).

Thanks for explaining I would of never thought of doing this without the great advice.

Re: Alliant Secured Loan

Anonymous — Sat, 09 May 2009 16:09:17 GMT

Just be sure to stress that the loan money goes straigt back into savings and won't be spent so that all interest charges are covered AND you have emergency and discretionary cash available should you need it.

This is a "Credit Builder Strategy Plan" not a spendable loan. The benefits will be better access to credit down the road at REDUCED INTEREST RATES which is money in the bank over the life of your credit use. So, call it a "no cost" investment in your financial and credit future.

Good luck and let us know how it all pans out

Message Edited by txjohn on 05-09-2009 09:09 AM

Re: Alliant Secured Loan

Anonymous — Mon, 11 May 2009 14:44:12 GMT

Well just took out a secured loan with Alliant. $8000.00 with 48 month terms. It came out to about 180.00 a month. It took about 5 minutes on the phone and the check will be in the mail in 3-5 days. I am going to turn around and deposit it right back into my savings with Alliant and only stretch the loan out to 12 months.

That was the easiest thing thing I have ever done and hopefully this will get me in good with Alliant down the road.

Re: Alliant Secured Loan

Itsmeagain — Mon, 11 May 2009 14:49:29 GMT

Congrats Diz . . . you've made a wise move. I'm certain it will pay dividends in the future with Allied. Not to mention you've created a very nice nest egg should the economy tank again.

Re: Alliant Secured Loan

Creditaddict — Mon, 11 May 2009 14:53:53 GMT

If that doesn't get you a credit card in 6 months, I don't know what will!