topic Alliant CU discontinuing Share Secure loans in General Credit Topics

Alliant CU discontinuing Share Secure loans

Anonymous — Wed, 27 Dec 2017 22:48:32 GMT

I just spoke with an Alliant loan officer at 5 pm today. Starting January 2, no more applications for the Share Secure loans will be processed. That product is being discontinued. Thus Alliant will no longer be an option for people interested in the Share Secure Loan Technique.

If anyone wishes to apply for the Alliant SS loan, they need to apply for the loan by 2 pm Eastern Time Fri Dec 29. Applying later than that (e.g. 4 pm) does not mean they won't be approved, but the earlier the better.

If a person wants the loan but does not yet have an Alliant membership, options are limited, since you need to get approved for membership with the money in the savings account BEFORE you apply for the loan. Such a person would need to apply for membership Thurs (ideally in the morning) and then would need to be prepared to do one of the following two things to get that money into the account and available:

(1) Make a wire transfer of the $510. (This is different from the much cheaper and slower method of an ACH transfer.)

(2) Get a friend or family member whom you know is a member of Alliant already to transfer the $510 from that person's account to yours (presumably with you doing an ACH transfer to his account).

Although everything regarding SS loans appears to have been removed on Alliant's website, it is still there once you log on as a member.

I will be deleting the Step-By-Step Guidance that was designed specifically with Alliant in mind. (This is the third post in the Share Secure Loan thread referenced above.) In the next few weeks it would be great to see if we can get a list of CUs and banks that are good alternatives to Alliant, and if we are lucky some enterprising members of the community may create appropriately detailed guidances for those institutions.

In the next post I will create a recap of the features that were good about Alliant -- stuff we should look for in another bank or CU.

Re: Alliant CU discontinuing Share Secure loans

Anonymous — Wed, 27 Dec 2017 23:09:25 GMT

Features we liked about Alliant:

(1) Alliant enabled loan terms of up to 60 months. The longer the loan term the better, since as soon as it closes you lose the FICO scoring benefit.

(2) Alliant permitted "pre-payment" of the loan. This means that you could pay off almost the entire balance of the loan at month 1 and still keep the loan open for the full term of the loan.

(3) Allliant permitted a pretty small initial loan size ($500) and returned almost all of it in the first few weeks once you paid the loan down. Some lenders require larger initial amounts or are less compliant about unlocking your money after paydown.

(4) Alliant did not do a hard pull -- whether for joining the CU or for applying for the loan. Some CUs have done a hard pull for one or the other or both.

(5) Alliant could be joined by pretty much anybody. This was in contrast to Navy Fed (for example) where a person needed family in the military -- or other CUs that had even more restrictive entrance requirements.

Bullets 1 and 2 above are essential to the SS Loan Technique working at all. Bullets 3-5 are really nice to have, but depending on a person's situation may not be essential.

Re: Alliant CU discontinuing Share Secure loans

Ardecko — Thu, 28 Dec 2017 02:26:29 GMT

Do we have a list of banks that are potentials or that have already been crossed off?

I was looking at Regions bank's site, and they have a candidate: https://www.regions.com/personal-banking/personal-loans/deposit-secured-loan
They say they serve 15 states. I assume that means they have branches there, no idea if they will let you in if you're not in one of those 15.

Also, in their PDF guide to this product: • All loans are subject to credit approval. In most cases, a credit decision is made within one business
day. If additional documentation or information, such as income verification, is required from the
customer, the credit decision and/or loan closing may be delayed.

Likely this means they will pull credit. Worth a ring?

Re: Alliant CU discontinuing Share Secure loans

Anonymous — Thu, 28 Dec 2017 02:32:45 GMT

@Ardecko wrote:
Do we have a list of banks that are potentials or that have already been crossed off?

We do not have a list. Anybody who wants to start one that would be wonderful. I'd be delighted if you could find out something about Regions. The five criteria are the things we need to know about.

Re: Alliant CU discontinuing Share Secure loans

Anonymous — Thu, 28 Dec 2017 02:43:37 GMT

I just played online for a couple minutes, googled Good Credit Unions and then grabbed one at random and looked at what personal loans it offered. I found this:

https://www.americafirst.com/loans/personal-loans/share-secured-loans.html

I haven't looked into it, but it shows how easy it is to locate possibilities. I liked it that it offered 10-year loan terms.

I believe the SS loan at Navy Fed has worked well for some people.

Re: Alliant CU discontinuing Share Secure loans

arkane — Thu, 28 Dec 2017 03:04:48 GMT

I found an old thread here from 2.5 years ago regarding SSLs. Info might be a bit out of date but could be a useful starting point?

I'm going to quote some parts of the OP in that thread, my annotations of some of the more promising CUs to look into are in RED

@jesseh wrote:
Hi there,

As I was advised by several myfico forums members (here) to get a share secured savings loan at a credit union, I'm starting to make a comparison. figured might as well share it. I tried to include most cu's that are frequently discussed on this forum.

Many cu's offer these type of loans, but don't advertise them on the website. So if you are a member at a different cu, give your local cu a call to inquire what they offer.
Anyway, today this infomation is useful, I probably won't maintain this list well though
Then, some cu's may do a hard pull upon joining, alliant, state dept and andrews fcu don't (I think). there are other comparison posts on this. (usually on secured credit cards)

Notes:
Apply by phone. if you apply online, the system may do an unnecessary inquiry automatically.
Call the loan team/lending solutions dept during office hours, otherwise you may be transferred to an external party, they usually have less reliable info.
Recommendation: Use the loan calculator recommended by themanwhocan

~~Alliant FCU~~
~~webpage~~
~~Amount: $500-500.000~~
~~Terms: 6-60 months~~
~~APR: 2.90%~~
~~INQ: no pull~~

PenFed FCU
no webpage (call) see this post
Amount: $250-no max
Terms: up to 142 months, minimum monthly payment of $25
APR: 2.00% + savings rate (0.05%)

Digital FCU
webpage
Amount: $200-
Terms: up to 10 years (120 months)
APR: 3.50%
For $1000 or less, the minimum monthly payment is $30 (ref: phonecall 6/17/15)
note: savings account has high yield on first $500

State Dept FCU (anyone can join as long as they join the American Consumer Council)
webpage
Terms: 6 months - 12yrs
APR: 3.10%
Amount: min. $500
(confirmed by phone by Monique 06/17/15, minimum is $500 and can be spread over 5years, no penalty for early termination)
(other user could spread $500 over only 36 months)

Andrews FCU
no webpage (call) appllying online is possible
Terms: 12-144months (depending on dollar amount)
Amount: $~~500~~ (min is $1000 now)-100.000
APR: 3.00% + savings rate
INQ: no pull

First Tech FCU
webpage
Amount: $500-500.000
Terms: up to 60/96 months
APR: 3.00% + savings rate

Patelco CU
webpage
Terms: up to 10yrs
APR: 5.00/5.10%

San Diego County FCU
APR: 5.00%

Coastal FCU
see other (post indicates potential soft pull for SSL)
APR: 2.1%
Amount: $480 over 24 months is possible

Golden 1 FCU
webpage
Amount: $500-
APR: 4.99%

Affinity FCU
APR 2.75% + divident rate OR 2.00% + certificate rate

NASA FCU
savings secured loan rate is 3.1% (3% + the 0.1% interest rate of the savings account).
Minimum Shared Secure Loan is $500, Minimum monthly payment is $25.
Terms up to 60 months.

I am excluding most cu's that can't be joined by anybody
(i.e. regional or military requirements)
psecu, navy fcu, cath fcu, etc.

Quick calculation (by a sdfcu loan officer)
$1000 over 3yrs at 3.1 % = $29.13 per month = $1048.68

If anyone has any suggestions or further info, please reply
have a good one!
Sincerely

Obvious disclaimer: I can't guarantee anything. that is the terms, approval, or the apr given here. the apr's are from either the website or by calling member services on the date of this post.

Re: Alliant CU discontinuing Share Secure loans

Anonymous — Thu, 28 Dec 2017 17:30:29 GMT

Woo hoo! This is immensely helpful.

As you say it's just a place to start with and what would help is if other folks can jump in and verify that the info in that much older thread is still accurate. As you can see, a week ago Alliant would have been on this list, so lenders can change what they offer.

I will say that the one factor that does not matter that's listed is APR. The big idea of the SSL technique is to pay almost all of the principal off at month 1. Thus whether you get charged 2.5% or 5% it shouldn't matter, unless it's imprtant whether you pay 1 dollar a year or 2 in interest. What does matter is the five factors I mentioned in the second post of this thread -- especially the first two.

Many thanks to you Arkane and to Jesseh. Let's continue to track this.

Re: Alliant CU discontinuing Share Secure loans

Anonymous — Thu, 28 Dec 2017 04:22:15 GMT

New apps will no longer be accepted, but are those already with an SSL safe? At least for now...?

Re: Alliant CU discontinuing Share Secure loans

Anonymous — Thu, 28 Dec 2017 04:35:54 GMT

Hi Sapphire. Yeah in situations like this, lenders may discontinue accepting further applications, but it would be very strange to close existing loans (especially since they'd lose the balance on them). On the other hand, the closer one gets to Fri evening, the more likely that they will find a way to turn down a loan app made at the last minute.

The loan officer I spoke with said that there would be a loan officer there even on Sat morning to work on any last SSL applications. So I can't imagine that there's a problem with any existing loans.

Re: Alliant CU discontinuing Share Secure loans

Ardecko — Thu, 28 Dec 2017 04:38:31 GMT

@Anonymous wrote:
New apps will no longer be accepted, but are those already with an SSL safe? At least for now...?

No reason to think they would be affected, but we'll have to wait and see.

Re: Alliant CU discontinuing Share Secure loans

arkane — Thu, 28 Dec 2017 05:11:44 GMT

Recent (March 2017) thread on PenFed SSL: http://ficoforums.myfico.com/t5/General-Credit-Topics/Shared-Secure-Loan-PenFed-SDFCU-Alliant-and-NFCU/td-p/4899689

@Anonymous wrote:
Have to show overall funds for a specific reason on something else, so happy to have it sit there. This makes my case a bit unusual perhaps.

I have found the solution for my situation since the original post. PenFed at 2%

i think this might be the best secured loan option out there. Terms, if you need them to over 120 months.....money is unfrozen as it is paid, shows as installment loan on all 3 CRA's. yes, I will use cash in the savings

these credit unions are fantastic....wish I had explored them long, long ago!

@Anonymous wrote:
Thanks for the great advice. Since I am just starting to rebuild, I would like some additional advice on this strategy.
PenFed already did a HP for signup so no further damage will be done for the loan. They pulled Experian.

Re: Alliant CU discontinuing Share Secure loans

Revelate — Thu, 28 Dec 2017 16:42:12 GMT

Interesting. Did they suggest why they were discontinuing it? How did this conversation with them come up anyway?

Alliant wasn't the only CU or lender that did this: actually I suspect *most* would be fine but Alliant was just the one I and subsequently a few others tried in our test case and since it worked so well, guess it stuck.

Penfed was going to be the one I was going to try next personally, 10 years > 5 years, but it's probably a HP but I don't consider a SP to be a requirement personally. Someone linked that research thread which is fantastic for this, but I don't think we're going to be short options on it... you can do this with pretty much any simple interest installment loan (doesn't have to even be secured) it's only when we run into wierdness like DCU's prepayment goofiness that it's going to come up.

Re: Alliant CU discontinuing Share Secure loans

Anonymous — Thu, 28 Dec 2017 17:53:18 GMT

Great thoughts, R. My comments in blue below.

@Revelate wrote:
Interesting. Did they suggest why they were discontinuing it? How did this conversation with them come up anyway?

The conversation came up because someone asked (on the monster SSL thread) why Alliant had removed everything about their SS loans from their core website. I double checked myself and confirmed that yes, it seemed to have vanished, so I gave Alliant a call. The rep was surprised too and transfered me to a loan officer. Then the LO explained that the SSL product was being discontinued on Jan 2 but was still available now.

He said that they were discontinuing it because they just didn't have much demand for it. I know for a fact that they were getting hammered with apps at one point (reddit and DoC both picked up the story about the myFICO technique and mentioned Alliant) so I doubt that's entirely right. More accurate might be that there is not much demand for the loan as intended -- where the borrower pays Alliant interest on the bulk of the principal throughout the loan life. I.e. there were few new applications that were profitable for Alliant. Indeed the SSL Technique borrowers (who paid it down at month 1) generated negative profit for Alliant, if you count the overhead and the cost of setting the loan up initially.

That's just my speculation. It could be that there have been very few apps at all in the last four months.

Alliant wasn't the only CU or lender that did this: actually I suspect *most* would be fine but Alliant was just the one I and subsequently a few others tried in our test case and since it worked so well, guess it stuck.

Penfed was going to be the one I was going to try next personally, 10 years > 5 years, but it's probably a HP but I don't consider a SP to be a requirement personally. Someone linked that research thread which is fantastic for this, but I don't think we're going to be short options on it... you can do this with pretty much any simple interest installment loan (doesn't have to even be secured) it's only when we run into wierdness like DCU's prepayment goofiness that it's going to come up.

I agree that the loan doesn't have to be secured, but that was a nice feature for the scoring-boosting technique for many people. The reason is that many people were looking for a boost but were also rebuilding, with scores in the low to mid 600s. The fact that the loan was secured by their savings gave Alliant a way to approve them even given their high-risk profile. (Alliant also gave these rebuilders confidence that they wouldn't burn a hard pull, given Alliant's nice soft-pull-only policy.)

Re: Alliant CU discontinuing Share Secure loans

Revelate — Thu, 28 Dec 2017 19:55:36 GMT

Heh, there's no such thing as burning a hard pull when you're at 600.

Have to spend inquiries to establish / re-establish credit, ain't no big thing. It's only on these forums and a few other places where people rampantly open accounts and a terrified of inquiries... neither make much rational sense to the outside observer most likely.

Re: Alliant CU discontinuing Share Secure loans

rprisco — Fri, 29 Dec 2017 01:49:32 GMT

Not sure helpful this is:

Hudson River Community Credit Union, Corinth NY. I have my personal lone through them, not sure of the rate but they do secured personal loans and credit cards too, the more you pay, the further it pushes out the next payment due date, I have no payment until March. Also they report balances as of end of month. The visa is great starting at 8.99 fixed. , secured visa also 8.99 fixed.

Hrccu.org is the Web site. I don't have time to look up specifics. They are great if you live in upstate new york.

Re: Alliant CU discontinuing Share Secure loans

manyquestions — Fri, 29 Dec 2017 03:40:51 GMT

@arkane wrote:
I found an old thread here from 2.5 years ago regarding SSLs. Info might be a bit out of date but could be a useful starting point?

I'm going to quote some parts of the OP in that thread, my annotations of some of the more promising CUs to look into are in RED

@jesseh wrote:
Hi there,

~~Alliant FCU~~
~~webpage~~
~~Amount: $500-500.000~~
~~Terms: 6-60 months~~
~~APR: 2.90%~~
~~INQ: no pull~~

PenFed FCU
no webpage (call) see this post
Amount: $250-no max
Terms: up to 142 months, minimum monthly payment of $25
APR: 2.00% + savings rate (0.05%)

Digital FCU
webpage
Amount: $200-
Terms: up to 10 years (120 months)
APR: 3.50%
For $1000 or less, the minimum monthly payment is $30 (ref: phonecall 6/17/15)
note: savings account has high yield on first $500

State Dept FCU (anyone can join as long as they join the American Consumer Council)
webpage
Terms: 6 months - 12yrs
APR: 3.10%
Amount: min. $500
(confirmed by phone by Monique 06/17/15, minimum is $500 and can be spread over 5years, no penalty for early termination)
(other user could spread $500 over only 36 months)

Andrews FCU
no webpage (call) appllying online is possible
Terms: 12-144months (depending on dollar amount)
Amount: $~~500~~ (min is $1000 now)-100.000
APR: 3.00% + savings rate
INQ: no pull

First Tech FCU
webpage
Amount: $500-500.000
Terms: up to 60/96 months
APR: 3.00% + savings rate

Patelco CU
webpage
Terms: up to 10yrs
APR: 5.00/5.10%

San Diego County FCU
APR: 5.00%

Coastal FCU
see other (post indicates potential soft pull for SSL)
APR: 2.1%
Amount: $480 over 24 months is possible

Golden 1 FCU
webpage
Amount: $500-
APR: 4.99%

Affinity FCU
APR 2.75% + divident rate OR 2.00% + certificate rate

NASA FCU
savings secured loan rate is 3.1% (3% + the 0.1% interest rate of the savings account).
Minimum Shared Secure Loan is $500, Minimum monthly payment is $25.
Terms up to 60 months.

I am excluding most cu's that can't be joined by anybody
(i.e. regional or military requirements)
psecu, navy fcu, cath fcu, etc.

Quick calculation (by a sdfcu loan officer)
$1000 over 3yrs at 3.1 % = $29.13 per month = $1048.68

If anyone has any suggestions or further info, please reply
have a good one!
Sincerely

Obvious disclaimer: I can't guarantee anything. that is the terms, approval, or the apr given here. the apr's are from either the website or by calling member services on the date of this post.

I think minimum monthly payments of $25 would result in a useful FICO benefit of only a couple months depending on the initial amount of the loan. Another useful thing to ask about are the minimum loan amounts for 60 months and 120 months if they offer those terms.

Re: Alliant CU discontinuing Share Secure loans

arkane — Fri, 29 Dec 2017 04:46:08 GMT

@Anonymous wrote:
Great thoughts, R. My comments in blue below.

@Revelate wrote:
Interesting. Did they suggest why they were discontinuing it? How did this conversation with them come up anyway?

The conversation came up because someone asked (on the monster SSL thread) why Alliant had removed everything about their SS loans from their core website. I double checked myself and confirmed that yes, it seemed to have vanished, so I gave Alliant a call. The rep was surprised too and transfered me to a loan officer. Then the LO explained that the SSL product was being discontinued on Jan 2 but was still available now.

He said that they were discontinuing it because they just didn't have much demand for it. I know for a fact that they were getting hammered with apps at one point (reddit and DoC both picked up the story about the myFICO technique and mentioned Alliant) so I doubt that's entirely right. More accurate might be that there is not much demand for the loan as intended -- where the borrower pays Alliant interest on the bulk of the principal throughout the loan life. I.e. there were few new applications that were profitable for Alliant. Indeed the SSL Technique borrowers (who paid it down at month 1) generated negative profit for Alliant, if you count the overhead and the cost of setting the loan up initially.

That's just my speculation. It could be that there have been very few apps at all in the last four months.

This would be my speclation, that this product simply wasn't profitable anymore. As I said in the mega thread, I actually feel kinda bad Alliant wouldn't even make that much interest off of the loan, especially since the loan became 91.2% paid down the day it got funded. This is one of the rare cases where I actually wouldn't mind paying out all the interest as agreed upon in the loan docs, because I think $10/year is a trivial price to pay for healthy FICO8 boost for 5 years.

Alliant wasn't the only CU or lender that did this: actually I suspect *most* would be fine but Alliant was just the one I and subsequently a few others tried in our test case and since it worked so well, guess it stuck.

Penfed was going to be the one I was going to try next personally, 10 years > 5 years, but it's probably a HP but I don't consider a SP to be a requirement personally. Someone linked that research thread which is fantastic for this, but I don't think we're going to be short options on it... you can do this with pretty much any simple interest installment loan (doesn't have to even be secured) it's only when we run into wierdness like DCU's prepayment goofiness that it's going to come up.

I agree that the loan doesn't have to be secured, but that was a nice feature for the scoring-boosting technique for many people. The reason is that many people were looking for a boost but were also rebuilding, with scores in the low to mid 600s. The fact that the loan was secured by their savings gave Alliant a way to approve them even given their high-risk profile. (Alliant also gave these rebuilders confidence that they wouldn't burn a hard pull, given Alliant's nice soft-pull-only policy.)
At least for me, the less "marks" on my credit file the better. Reason being I can't predict the future, and I'd rather not be in a position where I get denied for credit or get unfavorable loan terms because of the amount of hard pulls. Alliant's double soft pull for joining+SSL was really a breath of fresh air, and something I suspect is unique to Allliant unfortunately.

Re: Alliant CU discontinuing Share Secure loans

seattlecredit08 — Fri, 29 Dec 2017 05:17:30 GMT

Question: Does anyone know already which other CUs (e.g. from the list in this thread) allow for early pre-payment, which is key to this technique working?

Re: Alliant CU discontinuing Share Secure loans

Adidas — Fri, 29 Dec 2017 15:49:02 GMT

FYI I joined Alliant but never applied for the loan. I applied this morning with only $100 in my account and it let me apply for a $500 loan. I have another $500 being transferred from an outside bank right now. We'll see if it works but it appears you can apply and still have the loan incoming. I assume it's okay as long as you have the application in before Jan 2, not that the loan is finalized?

Re: Alliant CU discontinuing Share Secure loans

Anonymous — Fri, 29 Dec 2017 16:33:38 GMT

@arkane wrote:

This would be my speclation, that this product simply wasn't profitable anymore. As I said in the mega thread, I actually feel kinda bad Alliant wouldn't even make that much interest off of the loan, especially since the loan became 91.2% paid down the day it got funded. This is one of the rare cases where I actually wouldn't mind paying out all the interest as agreed upon in the loan docs, because I think $10/year is a trivial price to pay for healthy FICO8 boost for 5 years.

I have the same feeling about this. I'd have no issue with paying the full amount of interest as intended-just let it report as almost fully paid down for the whole term of the loan. I consider $10 a year a bargain for the 50 points this loan gave me.

I remember when I was setting it up, the young account rep from Alliant offered me the opportunity to defer the first payment- obviously the last thing I wanted to do. He had no idea what the whole point of the loan was.