cancel
Showing results for 
Search instead for 
Did you mean: 

Self Lender effects, short/medium/long

Estimate your FICO® Score range for free

FICO® Score Estimator

Auto Loans for ANY Credit Situation. Immediate Response.
Advertiser disclosure
Established Contributor

Self Lender effects, short/medium/long

[Deleted outdated info about my credit situation. It has changed a lot in a short time.]

 

For anyone not aware, the idea is that Self Lender "lends" you $500, which they deposit into a CD. You make monthly payments, and at the end of the year after you've repaid the "loan", you get the money out of the CD. It ends up costing around $75 when all is said and done, and in return, you get a year of positive payment on an installment loan.

 

My question is: does this actually hurt credit in the short term? Or, can it, in a thin-file situation?

 

[More outdated info about my personal credit situation deleted.]

 

Thanks!


FICO 8 scores are deceptively high. My profile is very young with a lot of recently opened accounts and large number of inquiries. My AU card isn't on TransUnion, so I won't have a FICO score there until October. No derogs. Over 5/24 until summer 2021.

Authorized user / Corporate

Closed but still on reports: ExxonMobil, $950, 10/08-02/11 (Equifax only) | Citi secured, $200, 045/19-09/19 | Capital One secured, $300, 04/19-08/19 | My Jewelers Club, $5,000, 05/19-08/19 | Green Dot Primor, $300, 05/19-08/19 | Unsecured personal loan from Coastal, $1,000, 05/19-08/19.

Goal cards: Ducks Unlimited, Chase Sapphire Reserve (or Preferred, haven't decided). Increased CLs across the board.
Long-term goal: Legitimate 770s on EX/EQ/TU, able to qualify for most normal credit products. Prime-rate mortgage.
Message 1 of 7
6 REPLIES 6
Frequent Contributor

Re: Self Lender effects, short/medium/long

These Vantage scores don't really mean anything.   I know you said you can't get FICO's yet but at times my Vantage scores have been 100 points higher or lower than my FICO scores.

 

Taking on a new loan:

  • Impacts average age of accounts in a negative way
  • Increases number of new accounts < 2 years old
  • Will have 100% utilization at the begining.
  • Increases # of inquiries

One way to mitigate the impact is to pay down 35% of it as soon as possible.  Doing so lowers the impact of the loan.  

 

Also note that with Vantage scores they do not include closed accounts in your average age of accounts so adding a new account to a thin file of open accounts could have a very big impact.  If that's the case it will have less of an impact on FICO where it includes your closed accounts.

 

 

Message 2 of 7
Established Contributor

Re: Self Lender effects, short/medium/long

[More outdated info about my personal situation deleted]

 

I'm not really worried about it, as I'm sure it'll be positive in the long run and I'm mainly interested in the long run, I was just surprised. Maybe it's just a glitch of the TU simulator.


FICO 8 scores are deceptively high. My profile is very young with a lot of recently opened accounts and large number of inquiries. My AU card isn't on TransUnion, so I won't have a FICO score there until October. No derogs. Over 5/24 until summer 2021.

Authorized user / Corporate

Closed but still on reports: ExxonMobil, $950, 10/08-02/11 (Equifax only) | Citi secured, $200, 045/19-09/19 | Capital One secured, $300, 04/19-08/19 | My Jewelers Club, $5,000, 05/19-08/19 | Green Dot Primor, $300, 05/19-08/19 | Unsecured personal loan from Coastal, $1,000, 05/19-08/19.

Goal cards: Ducks Unlimited, Chase Sapphire Reserve (or Preferred, haven't decided). Increased CLs across the board.
Long-term goal: Legitimate 770s on EX/EQ/TU, able to qualify for most normal credit products. Prime-rate mortgage.
Message 3 of 7
Moderator

Re: Self Lender effects, short/medium/long

As I said in your other thread disregard Vantage... If you have no open installment loans then this loan can help. With Fico you may experience a short term hit for the inquiry and new account opening. I would pay off the self lender down to below 40% of its initial loan as quick as possible as long as you dont lose months on it being open, some allow you to not make payments if you prepay the loan till said payment would be actually due. Fico will start increasing points once the balance is below the 40% mark.
"If there's a lack of money in your life, understand that feeling worried, envious, jealous, disappointed, discouraged, doubtful or fearful about money can never bring more money to you, because those feelings come from a lack of gratitude for the money you have."

"Reactions are powerful creators because they contain every element needed to manifest—they're a combination of thought, belief, and feeling in action. Positive reactions create more positive things, and negative reactions create more negative things. If you can respond to negative situations calmly and lightly, instead of with emotional turbulence, what happens next in your life will be so much better."

- Rhonda Byrne

Message 4 of 7
Established Contributor

Re: Self Lender effects, short/medium/long

Minor update. It is dropping my FAKOs around 30 points each. I know it's FAKO and not FICO. Still can't get my FICO scores except for EQ, which is the oddball in multiple ways for me.

 

Self Lender does not allow me to pay more than $48/month, and, I can't pay more than about two weeks early. I emailed to complain/ask about that. They told me that's the nature of the loan and if I paid most of it early, it wouldn't build credit as well. I am not sure if that's true or just their way of telling me not to bug them. But regardless, not worried about it, I know this process will take a while.


FICO 8 scores are deceptively high. My profile is very young with a lot of recently opened accounts and large number of inquiries. My AU card isn't on TransUnion, so I won't have a FICO score there until October. No derogs. Over 5/24 until summer 2021.

Authorized user / Corporate

Closed but still on reports: ExxonMobil, $950, 10/08-02/11 (Equifax only) | Citi secured, $200, 045/19-09/19 | Capital One secured, $300, 04/19-08/19 | My Jewelers Club, $5,000, 05/19-08/19 | Green Dot Primor, $300, 05/19-08/19 | Unsecured personal loan from Coastal, $1,000, 05/19-08/19.

Goal cards: Ducks Unlimited, Chase Sapphire Reserve (or Preferred, haven't decided). Increased CLs across the board.
Long-term goal: Legitimate 770s on EX/EQ/TU, able to qualify for most normal credit products. Prime-rate mortgage.
Message 5 of 7
Established Contributor

Re: Self Lender effects, short/medium/long


@KJinNC wrote:

Minor update. It is dropping my FAKOs around 30 points each. I know it's FAKO and not FICO. Still can't get my FICO scores except for EQ, which is the oddball in multiple ways for me.

 

Self Lender does not allow me to pay more than $48/month, and, I can't pay more than about two weeks early. I emailed to complain/ask about that. They told me that's the nature of the loan and if I paid most of it early, it wouldn't build credit as well. I am not sure if that's true or just their way of telling me not to bug them. But regardless, not worried about it, I know this process will take a while.


It sounds like you're trying to do the SSL technique. Sadly, that won't work with Self Lender.











Current

Goal Cards

Message 6 of 7
New Member

Re: Self Lender effects, short/medium/long

Usually your score will go down initially but after you make a payment it will go back up

Starting Score: 503
Current Score: 506
Goal Score: 650


Take the myFICO Fitness Challenge
Message 7 of 7
Advertiser Disclosure: The offers that appear on this site are from third party advertisers from whom FICO receives compensation.