Self lender reporting

[Anonymous]

Hi everyone!
For those of you that have a self lender loan i am curious to know how they report on your 3 bureaus. Does it say secured loan? Or reports differently?
Most importantly I am wondering if when applying for a mortgage what lenders would think about this little $500 secured loan there? Would they think that i am gaming the fico score and maybe dont have the ability to be responsible with a big loan? My middle mortgage score now is around 694 with 3 derrogatories(120+ late, 90d+ late,60d settled paid less than full amount) from a 3 years old short sale with only now Credit cards being reported PIF and AZEO, i am wondering if in my case would still be worth to go do a self lender if my priority is getting a conventional mortgage (a year from now) and improve mainly the mortgage score since i have enough credit cards already and 20% down payment for the home. Not sure if self lender from the Mortgage perspective would change so much my score (and help a little with the mix) enough to risk lenders looking at this $500 loan reported as to only trying to boost my score and think i am playing score games?
If you were in my situation would you still get a self lender loan? Or would you just allow the score improving with cc payments trying GW and continue without a SSL? Thank you

[Anonymous]

First and foremost if I am reading your post correctly you just referred to Self lender as a SSL (Shared Secure Loan)?

From what I've read, Self Lender is NOT a shared secured loan.

Second, you have multiple derogatories and your worried about a little 500 dollar self lender loan being interpreted as "gaming the system"?

Those derogs will be the only thing staning out to any potential lenders regardless of taking the loan or not.

[Anonymous]

Thank you. So your answer would be not to get the self lender?
I have never got a loan by myself(bad decision) so i have no idea how lenders will see derrogatories plus a self lender?
Other than trying to remove those bad things i want to make sure i get prepared and do what is important to improve score without creating more problems.
If will not help in anything and only help mostly for fico 8 why the risk?

[Anonymous]

From what I've read about installment loans, you wont start seeing score gains until you've paid it down to 8.9 percent or lower.

If you're planning on paying it off completely before you get your mortgage any score gains you would have gotten from the loan would be lost anyway.

Although, I've also read that some lenders like to see installment loan history on your report. If you've never had an installment loan then perhaps it might help to just go ahead and get the Self lender loan.

Maybe one of the more experienced members can chime in?

[Anonymous]

Yes. Self lender reports as a secured loan. It is not gaming the system. Secured loans are common. For exmaple bank may require you to secure a loan with some assets if your credit is not strong enouh.

The main thing is there is no score difference between a secured loan and an unsecured loan. They "help" just the same. As far as score you will see some score boost if you have no other loans because the "credit mix" portion of FICO will be realized. You will not see the maximum boost you get by paying the loan down below 8.9%. Still worth it imho if you have no other loans on your credit report.

Also now Self Lender gives you a secured card with the loan that does not require additional funds. That is two tradelines from one product with no hard pull to open.

[Anonymous]

Thank you Morpho that is great information and help. Would you elaborate about the card? how it works as i did not hear about it. I just know about the loan they offer. Thats good to know i probably would like that too if there is not hard pull even though i already have 8 cards. Or maybe is not necessary but with these derrogatories more cards Pif and more higher number of reported good payments would maybe compensate comparing to the other baddies from short sale. Not sure if is that how works? Several months there not paid until short sale was approved and done.

[Anonymous]

I do not have first hand experience with the card because they started the card right as my Self Lender loan came to an end. 

 
This video pretty much explains it:

https://learn.self.inc/lpg/click-through/self-card-education-1

[Anonymous]

Thank you so much i will check into that. Do you think the self card would still be good with the 8 cards i have already? Would add extra points to my score?

[FireMedic1]

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@Anonymous wrote:
Thank you so much i will check into that. Do you think the self card would still be good with the 8 cards i have already? Would add extra points to my score?

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If you have 8 cards. No need for any more. No more apps after the self lender. Mortgage lenders dont like to see any new accounts at least for a year before applying in some cases. Good Luck!

[randomguy1]

“From what I've read about installment loans, you wont start seeing score gains until you've paid it down to 8.9 percent or lower.”

^^^incorrect. 8.9% or lower is maximum score gain.