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Secured loans wash and repeat

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Regular Contributor

Secured loans wash and repeat

Hello. I was told to get a secured loan of 200 and pay it within the month and wash and repeat. Does this affect your aoaa? Will this help my credit?
Message 1 of 4
3 REPLIES 3
Frequent Contributor

Re: Secured loans wash and repeat

Where would you get a loan that low?

 

And you mean pay off the entire thing right away?

 

 

Message 2 of 4
Regular Contributor

Re: Secured loans wash and repeat

I have CDs I can borrow against. But with a secured loan they do not do inquiries due to it being your money you are borrowing. I do mines thru my credit union. Yes get 1 and pay it off within 21 days and then get another and pay it off the same way.
Message 3 of 4
Community Leader
Super Contributor

Re: Secured loans wash and repeat


@Caitt wrote:
Hello. I was told to get a secured loan of 200 and pay it within the month and wash and repeat. Does this affect your aoaa? Will this help my credit?

If each loan is reported as a separate one, it can annihilate your AAoA rather quickly unless you have 30+ accounts that are several decades old. 

The point of secured loan is to get one with a lender that would allow you to immediately pay it below 9% and push next payment well into the future, so you can get benefits of a low utilization loan without doing exactly what you described above 

EX 754 EQ 773 TU 752
Message 4 of 4
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