Self – Credit Builder Account Review
Anyone who wants to fix their credit but doesn’t want to use a credit card has other options. A credit builder loan is a great alternative to traditional credit building methods, and there is no credit check required. What’s better, it’s available in all 50 states. Our comprehensive Self Lender review will give you a good idea if this is a feasible option for you to use.
We’ll walk you through everything you need to know about this service step-by-step. This includes what a credit builder loan is, how you apply, and how it can help. We’ll also talk about who could benefit most from using this tool, and why it’s a good alternative. By the end of this Self Lender review, you will know if this credit builder loan is right for you.
Who or What is a Self Credit Builder Loan?
First up on our Self Lender review is pinning down exactly who or what Self Lender is. Basically, Self Lender offers credit building or credit repair installment loans. First, they offer free credit monitoring. This monitoring system lets you see exactly where your credit score is at. It also allows you to track your score and watch for fraudulent activity or incorrect information. This credit scoring service will give you tips and hints to improve your credit, and it’s all at no cost.
Most important, the company also offers a credit builder loan program. This program is where they offer a truly unique type of installment loan. It’s also where they can help people rebuild their credit. Whether you have bad credit or no credit, this program can help you. They designed the program to give people second chances, even when other lenders turned them down. It may be slightly slower than traditional credit building tools, but it works.
How the Credit Builder Loan Program Works
When you think of a loan, you think of applying and getting your money right away. However, this program works in reverse to a traditional installment loan. Once you apply for the loan, the company will place the loan amount in a Certificate of Deposit account. The Federal Deposit Insurance Corporation insures this money, so it’s safe. You’ll make set monthly payments for a set number of months until you pay the loan off. When you pay it off, the company will release the funds to you.
You can choose from a single year loan or a two-year loan program when you apply. The lowest payment amount this program has is just $25 per month, and it’s stretched out over two years. If you choose this loan, you’ll pay a $9 administrative fee. This fee will go up depending on which loan you choose, but it caps at $15 upfront. So, you don’t have to have a lot of money to enroll in this program. You just have to be sure that you can make all of your monthly payments on time.
Free On-Demand Credit Monitoring is Offered with a Self Lender Credit Builder Loan
You get free on-demand credit monitoring, and you’ll also get a VantageScore. This comes from TransUnion. It allows you to get into the habit of tracking your score while you build it. In around six months, you should see your score improve. Or, you should see a score generate if you didn’t have one. This program will let you pay off the balance before the lending period is up. However, this won’t help to build your score any higher.
When you get the money, it’s yours to do whatever you want with it. So you can create an emergency fund or reinvest it. You could even take out another credit builder loan and continue to improve your score. You want to pay the full term of the loan. This way you will have 12 or 24 months of on-time payments reported to the credit bureaus. Also, Self Lender is an installment loan which gets reported differently than a credit card which is a revolving account. Having different credit trade types on your credit report is called credit mix; it factors 10% of your credit score.
The Credit Builder Loan Application Process
Now that you know what this installment loan program does, our Self Lender review will go through the application process. It is fairly straightforward, and it can take as little as five minutes from start to finish.
Start by going to the Self Lender website and click “Get Started.” The site will then ask you what type of loan you want. Choose from a regular loan or the normal credit builder option with a CD. Then, you’ll have to create an account and log in. Once this is complete, you’ll have to fill in:
- Full Name
- Social Security Number
- Income Limit
It’ll take this information and run it through ChexSystems to check your banking history. It’s looking for any issues like bad checks or overdrafts. However, it usually ignores them unless you have outstanding balances. If it comes back with no issues, you’ll move on to the next step.
Self Review the Different Credit Builder Loan Options
Next, you’ll have to choose a loan amount, payment, and terms. These are all preset by the company. A larger loan won’t help you fix your credit faster. However, it might mean that you don’t pay as much for interest. You can choose from the following options:
Once you’ve settled on a loan, the site will ask you to input how you’d like to make your payments. You can choose from a debit card or a checking account. However, you’ll pay extra fees if you use a debit card to make your payments.
You’ll start making your monthly payments. The company will report your payments to all three credit bureaus. In around six months, you should see your score improve. However, this will only help if all of your other credit lines are in good standing. If you default on one, this program will do little to help build your credit score.
Penalties and Fees
If you get into this program and miss payments, you’ll pay for it. If you’re 15 days late with your payment, you’ll pay an additional 5% of the monthly payment fee. Also if you’re 30 days late with a payment, it’ll go on your credit report. If you don’t catch it up, it’ll eventually default. You’ll get your original deposit amount back. It’ll subtract whatever you still owed plus any fees. This will go on your credit report and damage your score.
Benefits and Drawbacks of the Credit Builder Loan
As with any credit building tool, the Self Lender program comes with pros and cons. It’s only fair that this Self Lender review gives you both sides so you can make an informed decision.
Self Credit Builder Loan Review of Benefits
- The program forces you to save.
- Any upfront costs are extremely affordable.
- No penalties for paying off the loan early.
- There is no credit check required with a hard credit inquiry.
- It can diversify your credit history because it’s an installment loan.
- It reports every payment to the credit bureaus.
Self Credit Builder Loan Review of Drawbacks
- Any late payments can damage your credit.
- You may not qualify if you have outstanding banking fees.
- You’ll pay 5% more per month if you’re 15 days late.
- It costs you to take out the loan.
- The CD’s interest rate is extremely low.
- It costs more to pay with a debit card.
People Who Benefit from this Program
This program is an excellent choice for people with no or bad credit. It’s also a good choice for people who want to try an alternative to traditional credit repair tools. As there is no credit check, it’s a solid choice for people with no credit history as well. If you’re younger and you can’t get a normal credit card, this program could work. It can give you a solid foundation to build your credit history on. As we mentioned before, it’ll diversify your credit history at the same time.
Alternatives to the Credit Builder Loan
If you’re still not sure about this program, there are other options available to you. They may cost more upfront or be harder to qualify for, but they’re available.
1. Authorized User
If a parent, relative, or sibling has a credit card, ask if they’ll add you as an authorized user. You’ll get your own card that functions off their line of credit. This is risky for them though. If you make purchases and don’t pay it, it’ll hurt their credit. Learn more here at making your teen an authorized user.
2. Loan Co-Signer
Another option available to you is to ask someone with good credit to co-sign a traditional loan with you. They’ll look at your co-signer’s credit history along with your own to determine your eligibility. If they approve your loan and you don’t pay it, your co-signer will be on the hook for the balance. Read more on the risks of co-signing.
3. Secured Credit Cards
A final option is applying for and getting a secured credit card. You can get them with bad or no credit, but they cost more upfront. You’ll pay a deposit that ranges between $49 up to $200, and $200 becomes your line of credit. Don’t carry a balance from month to month and you won’t pay interest. Review the Credit Fast Top 3 Picks for Secured Credit Card Applications.
So if you want to learn more from Self visit:
Self – Credit Builder Account + Secured Visa Credit Card
Self Review Credit Builder Loan Bottom Line
Our Self Lender review of the credit builder loan program gave you a comprehensive look at what it offers. We walked you through the application process and gave you benefits and drawbacks of the program. We also gave you alternatives. This program is a solid option for anyone who wants to build or fix their credit. You can choose from several payment, and loan amounts to fit into any budget. As long as you make your payments on time, it can help you build a solid credit history.
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