Poor Credit? Shared Secure Loans To Build Credit!

Posted by ECOKID on Jul 20th, 2009 | no comments home title

Can’t seem to find a way to get credit these days? Do you have a low credit score and want to increase? Have you been trying to pay things as you can afford them but would like to have the cushion of having a line of credit in case of emergencies? Then you might be looking for something like a shared secure loan to help you build credit. Recently, I talked with Jimmy at a credit union close to where I attend school and I asked him about what folks could do to rebuild credit if they ran into some issues of bad or poor credit? He mentioned that a good idea would be getting a shared secure loan from any credit union.

What is a shared secure loan?

Shared secure loans are loans that you give to yourself and are reported to the credit bureaus. Essentially, you come in with, lets say, 500 dollars and ask to put that in a savings that will then be put on hold as collateral for a 500 dollar loan the bank makes to you. The interest on this loan is extremely low, may like 1-3% and you just make monthly payments. Every time you make a payment, the same amount is released from the amount that is on hold in the savings account.

What is the benefit of getting a shared secure loan?

Essentially you are giving yourself a loan and giving the bank its interest cut for reporting it to the credit monsters! So, its a weird way of building your credit but hey, its building your credit! Not only do you have to save for the loan you want to give your self but you would also be helping yourself even more by building credit. If you are interested in knowing more about these types of accounts please call or visit your local banking institution to learn more.