Navy Federal Share Secured Loan

[gman]

I just opened a Navy Federal savings account online and managed to fund an ititial amount of $100 through my debit card on my BOA account. I'll keep adding over the next couple of weeks, then apply for the ss loan.

[stinastina]

Just a heads up on the Navy secured technique. Once you get down to $3, Navy will forgive that amount and close your loan with no notice. This can happen earlier than you expected and your scores will take a hit. Opening up a new loan will take another month or two to report.

[Anonymous]

---

@stinastina wrote:

Just a heads up on the Navy secured technique. Once you get down to $3, Navy will forgive that amount and close your loan with no notice. This can happen earlier than you expected and your scores will take a hit. Opening up a new loan will take another month or two to report.

---

Yes.  This is a risk with any lender (not just Navy).  My advice has always been to always keep your loan balance:

(a) Greater than $20... AND

(b) Greater than the original monthly payment

Thus if the original monthly payment was $36.23, I'd make sure the balance always stayed above $38.01.  If the original payment was $13.23 I'd keep the balance above $20.01.

I had a wise customer service rep with my student loan handler who first gave me that practical advice when I was paying down my 43k student loan and wanted to keep it open forever.

[CreditSage]

Sorry, just seeing this. If you still need help let me know.

-The tag (@) you used was incorrect and did not alert me.

[SouthJamaica]

---

@Anonymous wrote:

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.

---

@Anonymous @Anonymous

NFCU lets you pull external transfers into your loan and credit card accounts.

It just doesn't let you pull external transfers into your deposit accounts, for some strange reason.

[Anonymous]

Thanks SouthJ!

[Anonymous]

I just finished setting up an SSL with NFCU myself.

I had a little bit of a speed bump along the way. The first CSR I spoke with told me that $3000 would be enough for the 60 month term. I specifically asked him if I needed to put down $3001 and he assured me, no. The next day I get a call back with approval for $3000 for 36 months. That CSR told me that I would need $5000 if I wanted the full 60 months. So I declined and made a transfer for the additional funds. Once the money was in place I called back. They reused my previous application, put me on hold a couple times for five minutes to confirm with a loan officer, then approved me for full 60 months this time. I feel like the first CSR was just mistaken and I only needed the $3001. I didn't want to draw attention to myself though by arguing over a dollar and I had the extra cash to cover it fortunately.  

The first big payment is pending and then I just need to set up a small auto pay to keep it active.

I'd like you thank you all for the great advice here. With this taken care of and my 3 CCs, I'll be off to the garden for a while.

[Anonymous]

It may be relatively trivial amounts but I went ahead and paid $5000 SSL down to $325. 
If I'm doing my math correctly, $325 x 2.25% interest ÷ 365 days means I'm paying 2¢ per day in interest and $36.50 over the 60 month term of the loan.
I wasn't sure how the rounding was going to work and with $445 (8.9% of 5000) I was closer to 3¢ per day in interest and > $50 over the loan term.

I still feel that it's comfortably above the $87 montly payment so in no danger of having the loan closed early.

I'm probably over thinking it for a savings of $14.

[Anonymous]

The SSL hit my reports a few days ago and with no other changes I saw Experian FICO 8 jumped 22 points.

[Nayola]

My husband just set up a Share Secured Loan with Navy.  He put $3051.00 into his savings account.  Once that showed up as available, he called Navy and requested a loan for $3001.00.  They approved the loan and set it up and the money was available probably within less than 24 hours.  He then paid it down to $240.  This pushed the next payment to 6/27/2023.  I will update this post when we see what happens with his credit score.