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NFCU SSL (Pledge Loan)

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CH-7-Mission-Accomplished
Valued Contributor

Re: NFCU SSL (Pledge Loan)


@M_Smart007 wrote:

@CH-7-Mission-Accomplished wrote:

@SouthJamaica wrote:

@M_Smart007 wrote:

@SouthJamaica wrote:

@805orbust wrote:

Hey guys, in theory, wouldn't this work with an unsecured loan as well?  I mean, since you're beyond the beginner stage, why tie up your $$$?  


1.  Yes NFCU does do the same thing for personal loans...  i.e. pushing out the next due date.

2.  You're not really tying up your money with the SSL procedure; the money is "tied up" just for a day or two.

3.  There would be a hard pull for the personal loan.

4.  You could get turned down for the personal loan.


+1 This^

@805orbust,

I took out four loans in total.

1) Navy SSL (SP)

1) Navy PL Unsecured (HP)

(2) Penfed unsecured loans on (1 HP)

 

Now I admit, it was a funny way of doing things,

I also wanted to experiment with having (4) open loans. (and paydown utilization science test)

HP's are a dime a dozen "Plenty Available"Smiley Tongue

I ended up paying everything off, and keeping a $20 balance on the PenFed $25K Unsecured loan.

At least on paper, (during a manual review) it looks good to have paid off (3) and mostly paid off #4   ..FICO likes itSmiley Very Happy

Computer algorithms could care less, as long as it see's an open installment paid below 8.9% (now that is better than Experian BoostSmiley Tongue)

 

My PenFed unsecured Installment loan will end Dec. 2023

I will most likely go the NFCU SSL $3010 route again..

 

And yes @SouthJamaica ,

I can hear you in my head saying "Please do not confuse the young credit students" smiley-laughing emoticon.gif


You really know me Smiley Happy


When you say you paid everything off but left $20 on the Penfed personal loan, did that push the next due date out by many months?   Does Penfed work like Navy in terms of advancing the next payment due date if you prepay?  If yes, does this work with a Penfed SSL?   Thanks.


@CH-7-Mission-Accomplished,

Pre-Paying the PenFed PL shortens the loan by one year  ..so a five year will become four years.

ETA: I log in occasionally and make the few cents payment of interest that accumulates.

I do this to keep activity, and make sure it does not get closed.

 

I cannot answer you PenFed SSL question (my guess it would be the same as NFCU) .. I would call them and confirm?


Thanks for responding.   I know with other SSL's the remaining term shortens somewhat because the interest owing on the loan is very low so a lot of the payment goes to principal.   

Message 21 of 38
PayAndProsper
Regular Contributor

Re: NFCU SSL (Pledge Loan)


@FireMedic1  escribió:

After Alliant pulled the SSL plug thanks to this place probabaly. We all headed to NFCU. I only paid $1 every month just to show activity. Even though the date was way out there. Went thru a nerf with Alliant after the first SSL ran out. @SouthJamaica Yes it it was a typo. I did $3010. Has to be over $3000 for the 60 months.


Not that this is a super important detail, but, it can be $3,000 on the nose. I recently went through the process with a friend for that amount.

 

https://i.ibb.co/sPyd5dz/2023-04-19-21-54-54.jpg

2023-04-19-21-54-54

 

*Edited to embed image.


Utilization Stats:

Current FICO® Score 8:

Goal FICO® Score 8:


Financial Institutions:

Message 22 of 38
butterpecan
Frequent Contributor

Re: NFCU SSL (Pledge Loan)

 


@Jeffster1 wrote:

Well, I did it. Easy-peasy. Many thanks to everyone.

 

1. I applied for an NFCU Pledge Loan for $3010 for 60 months.

 

2. Approved (of course).

 

3. Immediately paid back $2742.11.

 

4. Next due date moved to 8/18/2027. 

5. Remaining balance is $268.07.

 

6. I'm considering submitting an auto-pay for $5 each month. Would that work? @SouthJamaica ?

 

Again, many thanks.

 

UPDATE: I set an auto-pay of $5.00 monthly.

 

 

 


@Jeffster1 I'm so sorry if I sound dumb but what is the purpose of doing this? I am a newbie and learning all I can and see this formula and calculation in other posts here but don't quite grasp the concept. I have a credit builder loan through credit strong that I just opened. I did this before I knew I could join NFCU so now I feel stuck and I'm paying interest in my own money so I've been going through posts trying to look for a plan B and decide if I want to shut it down. It has not been reported to my credit report yet so I am researching all of these loans that come up when I type NFCU in the search box. Could you give me a quick run down on what this whole system is you're doing with this loan? Thx! 




Message 23 of 38
GZG
Valued Contributor

Re: NFCU SSL (Pledge Loan)


@butterpecan wrote:

 


@Jeffster1 wrote:

Well, I did it. Easy-peasy. Many thanks to everyone.

 

1. I applied for an NFCU Pledge Loan for $3010 for 60 months.

 

2. Approved (of course).

 

3. Immediately paid back $2742.11.

 

4. Next due date moved to 8/18/2027. 

5. Remaining balance is $268.07.

 

6. I'm considering submitting an auto-pay for $5 each month. Would that work? @SouthJamaica ?

 

Again, many thanks.

 

UPDATE: I set an auto-pay of $5.00 monthly.

 

 

 


@Jeffster1 I'm so sorry if I sound dumb but what is the purpose of doing this? I am a newbie and learning all I can and see this formula and calculation in other posts here but don't quite grasp the concept. I have a credit builder loan through credit strong that I just opened. I did this before I knew I could join NFCU so now I feel stuck and I'm paying interest in my own money so I've been going through posts trying to look for a plan B and decide if I want to shut it down. It has not been reported to my credit report yet so I am researching all of these loans that come up when I type NFCU in the search box. Could you give me a quick run down on what this whole system is you're doing with this loan? Thx! 


when FICO scores are calculated, one of the things they look at is if you have a loan

 

Your FICO score can be increased if you have a loan that:

 

that loan is open

 

also, you get bonus points if: 

 

that loan is nearly paid off (92% paid off) 

 

your current loan is open, but it's not nearly paid off like a Navy SSL would be. 

 

If you have other open loans, none of this applies to you and I wouldn't advise you to do so personally.

 

Navy's SSL lets you accomplish both of these, along with pushing back the due date when you do so. 

 

By opening a 5 year loan and immediately paying it off to 8%, you now get both bonuses in terms of FICO scoring.

 

That's why a NFCU SSL is better than the popular "credit builder" loans, because you get both of those bonuses instead of one of them. 

 

If you don't have any open loans, and you aren't planning to get a loan in the somewhat near future 1-2 years, I would pay and close off your credit builder loan and get a 5 year $3010 navy SSL. 

 

When you do a 5 year $3010 navy SSL, you pay off the loan 92% of the way, you get your money back, and your next due date is in like 4 years, which means you don't need to make payments on it until then

 

Starting FICO 8:

Current FICO 8:

3/6, 5/12, 14/24

Message 24 of 38
Jeffster1
Valued Contributor

Re: NFCU SSL (Pledge Loan)

@butterpecan  @GZG nailed it. 🎯

 

My next payment is due on 8/18/27, but I enjoy the benefit for the next 4 years of having a loan on my credit report that is ~91% paid off without any action necessary on my part until 2027. I do make a payment of $1.00 a month to offset interest but I am not required to do so. 

FICO 8 (3/1/24) EX 805 EQ 824 TU 844

Current lineup as of 9/23
American Express Gold | American Express Blue Cash Everyday 11K | American Express Blue Cash Preferred 10K I American Express Marriott Bonvoy Bevy 5K I American Express Hilton Honors Surpass 3K I Bank of America Customized Cash Rewards Visa 20K | Kinecta MyPerks Rewards MC 35K | TD Bank Double Up Visa 4K | USBank Platinum Visa 5K | BMO Harris Cash Back MasterCard 12K | Capital One SavorOne MC 3K | Capital One Walmart MC 2K | NFCU Amex 15K | NFCU CashRewards Visa 20K I Citi Best Buy Visa 10K I Macy’s Amex 6.5K I Bread Financial American Express 8K l AAA Daily Advantage Visa Signature 6K I Wells Fargo BILT World Elite MC 30K I BCU Cash Rewards Visa 8K I Chevron Techron Advantage Visa 2.5K I JCPenney Mastercard $6K I UCLA Wescom CU Rewards Visa 7K I
Message 25 of 38
butterpecan
Frequent Contributor

Re: NFCU SSL (Pledge Loan)


@GZG wrote:

@butterpecan wrote:

 


@Jeffster1 wrote:

Well, I did it. Easy-peasy. Many thanks to everyone.

 

1. I applied for an NFCU Pledge Loan for $3010 for 60 months.

 

2. Approved (of course).

 

3. Immediately paid back $2742.11.

 

4. Next due date moved to 8/18/2027. 

5. Remaining balance is $268.07.

 

6. I'm considering submitting an auto-pay for $5 each month. Would that work? @SouthJamaica ?

 

Again, many thanks.

 

UPDATE: I set an auto-pay of $5.00 monthly.

 

 

 


@Jeffster1 I'm so sorry if I sound dumb but what is the purpose of doing this? I am a newbie and learning all I can and see this formula and calculation in other posts here but don't quite grasp the concept. I have a credit builder loan through credit strong that I just opened. I did this before I knew I could join NFCU so now I feel stuck and I'm paying interest in my own money so I've been going through posts trying to look for a plan B and decide if I want to shut it down. It has not been reported to my credit report yet so I am researching all of these loans that come up when I type NFCU in the search box. Could you give me a quick run down on what this whole system is you're doing with this loan? Thx! 


when FICO scores are calculated, one of the things they look at is if you have a loan

 

Your FICO score can be increased if you have a loan that:

 

that loan is open

 

also, you get bonus points if: 

 

that loan is nearly paid off (92% paid off) 

 

your current loan is open, but it's not nearly paid off like a Navy SSL would be. 

 

If you have other open loans, none of this applies to you and I wouldn't advise you to do so personally.

 

Navy's SSL lets you accomplish both of these, along with pushing back the due date when you do so. 

 

By opening a 5 year loan and immediately paying it off to 8%, you now get both bonuses in terms of FICO scoring.

 

That's why a NFCU SSL is better than the popular "credit builder" loans, because you get both of those bonuses instead of one of them. 

 

If you don't have any open loans, and you aren't planning to get a loan in the somewhat near future 1-2 years, I would pay and close off your credit builder loan and get a 5 year $3010 navy SSL. 

 

When you do a 5 year $3010 navy SSL, you pay off the loan 92% of the way, you get your money back, and your next due date is in like 4 years, which means you don't need to make payments on it until then

 


@GZG Thanks for the clarification. Is the $3010 set in stone or can you do more or less? Where does that exact amount come from I wonder? The credit strong loan I have is for $1010 they picked that amount when I applied and it is for 48 months. I most definitely want to close it and go with NFCU but not if it's going to ding my score. They've not reported it to any of the CRA's yet as I mentioned and it was only a soft pull inquiry. If I pay it off before they report it do they even bother to report it? The SSL loan you're describing with NFCU would have been my 1st choice had I known all military not just Navy were entitled to apply for a membership. Oh well, I'm in now and chipping away at it. Congrats on all of your progress. Thanks again. 




Message 26 of 38
GZG
Valued Contributor

Re: NFCU SSL (Pledge Loan)


@butterpecan wrote:

@GZG wrote:

@butterpecan wrote:

@GZG Thanks for the clarification. Is the $3010 set in stone or can you do more or less? Where does that exact amount come from I wonder? The credit strong loan I have is for $1010 they picked that amount when I applied and it is for 48 months. I most definitely want to close it and go with NFCU but not if it's going to ding my score. They've not reported it to any of the CRA's yet as I mentioned and it was only a soft pull inquiry. If I pay it off before they report it do they even bother to report it? The SSL loan you're describing with NFCU would have been my 1st choice had I known all military not just Navy were entitled to apply for a membership. Oh well, I'm in now and chipping away at it. Congrats on all of your progress. Thanks again. 


the minimum is $3000, people typically do a small amount over that to avoid rare DPs of underwriting lowering the term length for being exactly at $3000

 

they're likely still going to report it, even if you pay it off in full so what's done is done. 

 

if you're not planning on considering any loans in the next five years, I would pay off the credit builder loan and get the SSL, even though that would mean a small hit to your credit in the short term for the new account to set up the loan aspect of your credit profile for 5 years. 

 

 

Starting FICO 8:

Current FICO 8:

3/6, 5/12, 14/24

Message 27 of 38
FireMedic1
Community Leader
Mega Contributor

Re: NFCU SSL (Pledge Loan)

@butterpecanThe SSL is done for the "Credit Mix" on your credit reports. The base is 3 cards and 1 installment loan to make FICO happy. @PayAndProsper When it came out it after Alliant shut down the SSL. We all went by $3010 to make sure we got the 60 months. No need to point out $10. The money stays in your savings account. Your not losing out on $10.


Message 28 of 38
PayAndProsper
Regular Contributor

Re: NFCU SSL (Pledge Loan)


@FireMedic1  escribió:

@butterpecanThe SSL is done for the "Credit Mix" on your credit reports. The base is 3 cards and 1 installment loan to make FICO happy. @PayAndProsper When it came out it after Alliant shut down the SSL. We all went by $3010 to make sure we got the 60 months. No need to point out $10. The money stays in your savings account. Your not losing out on $10.


Yes. It's certainly not a big deal.

 

So, am I to understand that there are underwriters who have adjusted the term even after the signing of the promissory note? Or, are you saying that upon going to sign the promissory note, some people had found that the 60-month term had been shortened due to it being $3,000?


Utilization Stats:

Current FICO® Score 8:

Goal FICO® Score 8:


Financial Institutions:

Message 29 of 38
Jeffster1
Valued Contributor

Re: NFCU SSL (Pledge Loan)


@PayAndProsper wrote:

@FireMedic1  escribió:

@butterpecanThe SSL is done for the "Credit Mix" on your credit reports. The base is 3 cards and 1 installment loan to make FICO happy. @PayAndProsper When it came out it after Alliant shut down the SSL. We all went by $3010 to make sure we got the 60 months. No need to point out $10. The money stays in your savings account. Your not losing out on $10.


Yes. It's certainly not a big deal.

 

So, am I to understand that there are underwriters who have adjusted the term even after the signing of the promissory note? Or, are you saying that upon going to sign the promissory note, some people had found that the 60-month term had been shortened due to it being $3,000?


There have been reports of, as @GZG said, rare underwriters shortening  the term of the loan. This took place during the approval process.  

Since you said your existing loan is a credit builder loan, you should see if there is a pre-payment penalty before you do anything. Regardless of what you do going forward, the existing loan will most likely be reported. Because you just started it, your utilization on the credit builder loan is high, which will have a negative effect on your scores until paid down.

FICO 8 (3/1/24) EX 805 EQ 824 TU 844

Current lineup as of 9/23
American Express Gold | American Express Blue Cash Everyday 11K | American Express Blue Cash Preferred 10K I American Express Marriott Bonvoy Bevy 5K I American Express Hilton Honors Surpass 3K I Bank of America Customized Cash Rewards Visa 20K | Kinecta MyPerks Rewards MC 35K | TD Bank Double Up Visa 4K | USBank Platinum Visa 5K | BMO Harris Cash Back MasterCard 12K | Capital One SavorOne MC 3K | Capital One Walmart MC 2K | NFCU Amex 15K | NFCU CashRewards Visa 20K I Citi Best Buy Visa 10K I Macy’s Amex 6.5K I Bread Financial American Express 8K l AAA Daily Advantage Visa Signature 6K I Wells Fargo BILT World Elite MC 30K I BCU Cash Rewards Visa 8K I Chevron Techron Advantage Visa 2.5K I JCPenney Mastercard $6K I UCLA Wescom CU Rewards Visa 7K I
Message 30 of 38
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