How do shared secured loans work?

Anonymous · ‎08-13-2019

I'm looking at NFCU SSL, I see that I can do a 5-year with a minium deposit of $1,000. Let's say I took that option. How would it benefit and affect me? Do I make payments on the $1,000? At the end of my 5-year SSL, do I get $2,000? Do I pay interest or does NFCU pay interest? What would be an estimated monthly payment?

AllZero · ‎08-13-2019

First rule of SSL. Don't ask all kinds of questions to the CSRs. Don't burn that bridge. If you have questions. Ask it here.

Here are primers:
https://ficoforums.myfico.com/t5/Personal-Finance/NFCU-SSL/m-p/5295063

https://ficoforums.myfico.com/t5/Understanding-FICO-Scoring/Adding-an-installment-loan-the-Share-Sec...

https://ficoforums.myfico.com/t5/Personal-Finance/The-Quest-for-an-SSL-alternative-to-Alliant/m-p/51...

AllZero · ‎08-13-2019

1. You'll need $3001 minimum for the 5 year SSL. $3010 to be safe.
2. You get the funds back as soon as you pay down to 8.9%
3. Yes, you pay interest on the open loan whatever amount that might be when interest is calculated.

ETA This is your money you are using; hence, secure. You are not doubling your money. You're not using their money.

Anonymous · ‎08-13-2019

@AllZero wrote:
1. You'll need $3001 minimum for the 5 year SSL. $3010 to be safe.
2. You get the funds back as soon as you pay down to 8.9%
3. Yes, you pay interest on the open loan whatever amount that might be when interest is calculated.

ETA This is your money you are using; hence, secure. You are not doubling your money. You're not using their money.

That's what i'm not understanding. If I put in the $3010, but then I have to make payments until I hit $3010 right? So wouldn't there be $6020 at the end?

What is the difference between (above) and (below)?

AllZero · ‎08-13-2019

That is a certificate.

Click here https://www.navyfederal.org/products-services/loans/personal-loans/personal-loans.php

Anonymous · ‎08-13-2019

So SSL are basically forms of paying for credit history?

AllZero · ‎08-13-2019

@Anonymous wrote:
@AllZero wrote:
1. You'll need $3001 minimum for the 5 year SSL. $3010 to be safe.
2. You get the funds back as soon as you pay down to 8.9%
3. Yes, you pay interest on the open loan whatever amount that might be when interest is calculated.

ETA This is your money you are using; hence, secure. You are not doubling your money. You're not using their money.
That's what i'm not understanding. If I put in the $3010, but then I have to make payments until I hit $3010 right? So wouldn't there be $6020 at the end?

You put in $3010 of your own money into the SSL account. They give you back $3010 immediately. They will freeze the SSL funds until you pay it back. Use the funds they gave you to pay back and down the SSL account to 8.9% ($2742.11). The unfrozen funds will return back into your account. The rest will be frozen to keep the account open. Set up autopay for a few dollars to keep account active. Each autopay will return the unfrozen funds back into your account, whichever amount that you set up autopay for.

AllZero · ‎08-13-2019

@Anonymous wrote:
So SSL are basically forms of paying for credit history?

Yes.

SouthJamaica · ‎08-14-2019

@Anonymous wrote:
@AllZero wrote:
1. You'll need $3001 minimum for the 5 year SSL. $3010 to be safe.
2. You get the funds back as soon as you pay down to 8.9%
3. Yes, you pay interest on the open loan whatever amount that might be when interest is calculated.

ETA This is your money you are using; hence, secure. You are not doubling your money. You're not using their money.
That's what i'm not understanding. If I put in the $3010, but then I have to make payments until I hit $3010 right? So wouldn't there be $6020 at the end?

What is the difference between (above) and (below)?

Initially yes, but I just make the payments via transfer back from the savings account, so the amount on hand goes down as the loan goes down.