Navy Federal Share Secured Loan

[CreditSage]

Update:

6 days (3 business) after opening this loan and it is already reporting to the Bureaus. I woke up to an Experian alert notifying me of a new account (will wait until next TU/EQ update to verify it showing there as well). Looks like I got extremely lucky with the timing in opening it at the end of April and already reporting. It also included my payment so I’m already starting at <9% utilization.

Couple of questions:

1) The account type says “secured loan.” Will lenders look at this with less favor given that it is secured compared to unsecured? How does secured vs. unsecured affect FICO all other things being equal?

2) I made one large payment (92% of loan) immediately upon opening the account. Consequently my report shows a payment for April (however not the amount). If I make no more payments given that one is not due for 4+ years will I still be green for monthly payments? Should I consider paying $0.30 a month to cover interest accumulation?

Any other thoughts would be great, thanks.

[Anonymous]

1. secured or unsecured, you now have an Installment Loan which is what you were going for by opening up the SSL. Points should come and shouldn't matter what the specific loan is.

2. if your next due date has been pushed out, you still should 'see green' since your loan payment is up to date

[Anonymous]

Credit cards can run into trouble when they don't show any activity for a long time and the same is true for loans.  Some lenders will charge an inactivity fee, for example, at month 12.

A simple recomendation is to set up a quarterly auto-payment of $2.  Then you get forget about the loan until it is closer to the end of the term.

[CreditSage]

NFCU maximum length between payments for autopay is 1 month. The loan has $240 left on it and 60 months duration. Interest says $0.01 a day. Should I set a monthly autopay for $1-$3? Any input is great.

[Anonymous]

With most lenders you can make a payment from an external bank into your loan account.  So normally it wouldn't have to be a payment from Bank X's checking to Bank X's loan account.

But I think I may have seen a post about how Navy doesn't let you push money from an external account into one of its loans or credit cards.  If so, then a $3 payment every month between now and month 58 seems reasonable.  Then pay it off on month 59.

$4/mo might cause the balance to get too close to $0.  When a loan balance gets too low (e.g. $20) some lenders will just forgive the remainder rather than keeping the loan open.

[Glen_M]

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@Anonymous But I think I may have seen a post about how Navy doesn't let you push money from an external account into one of its loans or credit cards.  If so, ...

I have always made payments from other institutions.  NFCU is one of the easiest I have set up to accept payments from elsewhere, push or pull, they're not picky like PenFed.

[WD2005]

I'm interested in this as well. I just became a member this week, through my sister, and was interested in trying this out. I have a "credit builder" loan through my local CU but its auto pay monthly and runs until December. 

[Bees18]

@creditsage

I just signed up for membership at NFCU, and I have a question. I only opened a savings, It won't let me fund from my external checking account into the savings to fund the loan.

I will try to find it externally from my checking into the savings, but I don't even see my account number anywhere, just the routing.

How does this work then? What will happen when they send me the funds for the loan will they mail it? And what happens when the funds are released after I pay it down, how will I even get them out of the savings into my external checking?

Really confused! Can't find this info on the forum either :/ Rep said I would need to go into a branch...?

[Anonymous]

A Navy rep should be able to help you fund your savings account via an electronic transfer.  The rep should also be able to help you find out your account number.

Say focused with the rep only on the simple task of getting some money into your savings account.  Once that is done (give it a few days to materialize) you can call back and get help with understanding how to make more frequent (and larger) deposits from the external account.

The confusion you and the rep are experiencing likely owes to the several different questions you are asking at the same time, including questions about SSLs.  The SSL questions only make sense after you have a savings account with a solid amount of money in it for at least 3-4 days.  Then it makes sense to ask questions about borrowing against the money in that savings account.

[Anonymous]

Have you seen a major point increase on the three credit bureaus by any chance yet. I'm really interested in doing the same loan for 3k with them..Can you provide more details on how this is working for you?

Thanks