Build Credit Easily with a Cash Secured Savings Loan
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Build Credit With a Cash Secured Savings Loan

 

If you need to improve your credit without putting down any money up front, a cash secured savings loan (a.k.a credit builder loan, credit builder program etc.) could be what you need. It’s not the most common option you’ll stumble across, but it is, by far, the easiest and most painless way to fix your credit.

With a cash secured savings loan, the proceeds of the loan are held for you in a savings account while you pay it off. As you build equity with your monthly payments, you can access portions of the savings or wait until the entire program is paid off and take the proceeds in one lump sum. Your payments each month are reported to the credit bureaus just like your payments to a credit card or a line of credit would be. It appears, on your credit report as an installment loan. As long as you keep the rest of your credit usage and payments in check, these cash secured savings loans are an excellent way to build your credit score.

Credit building can seem like an insurmountable task. Especially if you’ve had to declare bankruptcy or go through a consumer proposal in the past. It seems like everywhere you turn, lenders are not willing to help you or require money down that you don’t have. You’re being declined for credit cards, loans and lines of credit and it seems like you’ve run out of options for building your credit. It's not easy to figure out how to fix your credit.

It’s important to keep in mind, however, that credit building isn’t impossible - especially with credit building programs.

This article will feature one more way you can get on the right track with learning how to fix your credit. One that perhaps you have not thought of. I am talking about the cash secured savings loan from Refresh Financial.

5 Benefits of a Cash Secured Savings Loan

1. It’s a great way to build or fix credit

The primary strength of a secured savings loan is building credit. These types of credit builder programs/credit rebuilding loans are superior to other credit products because they pose low risk to you and to the lender, and is a cost-effective way to build your credit score as quickly as possible. As long as you faithfully make your payments every month, it's going to look like you're handling a regular loan with ease. This is important for lenders to see, as you want to look as responsible as possible. You are not going into debt in order to rebuild your credit, but your payments are reported to the credit bureaus and look the same as payments to any other installment type loan. By setting up an automatic payment schedule out of your bank account, there is very little that can go wrong here, and only things that can go right. You’re going to see your monthly payments improve your credit score over time, no matter what your credit history looks like.

2. Lower interest rates

If you’ve got anything less than great credit, you’re probably not going to get the best interest rates from credit card companies, even on a secured credit card. Taking out a secured savings loan will see you dealing with much lower interest rates than other credit products like credit cards. This means, in the long run, you’re going to save yourself a significant amount of money.

3. Convenience

A secured savings program only takes minutes to apply for and up to 24 hours to approve. There is no need to come up with funds to secure the program and no matter what your credit history is, you can be up and running with a secured program to promote credit building in less than a day (no money up front, no credit checks!). Payments to the cash secured savings loan program are set up as automatic withdrawals from your bank account, so you don’t even have to worry about missing a payment. It’s so simple, anyone can do it.

4. Easy to qualify

Whether your credit history is bad or good or you just have no credit at all, it doesn’t matter. Most people get approved for a secured savings program at Refresh Financial no matter what their credit history looks like. That means no credit application anxiety.

5. Kickstart Your Savings

As you pay down your cash secured loan, the principal is being kept in a savings account for you. Why not continue to save after you’ve finished paying off the loan? What can you do with your savings?

  • Pay Off Your Debts

It feels great to throw a big chunk of money towards your debts and watch them disappear. It's also great for your credit score! Combined with the positive effects that a secured savings loan will have on your score, paying off your existing debts will boost your credit score even higher.

  • Save For A Down Payment on a House

With your rising credit score and a good chunk of money to start your savings with, you could finally buy your first home.

  • Use Your Savings Towards A Secured Credit Card

If you want to boost your credit score even more after completing the cash secured savings loan, open up a secured line of credit or apply for a secured credit card with the money you've accumulated.

  • Use As A Down Payment On A Car

If you're tired of paying for endless repairs, it might be time to upgrade to a new vehicle. With your boosted credit score and the payout from the secured savings loan, it should super easy!

  • Use It As A Damage Deposit

If you're looking to move out on your own, this could be your ticket!

  • Invest In Your Career

You can use the payout from the secured savings loan to go back to school or upgrade your skills to better your chances at a promotion or raise.

  • Invest In Your Home

If you’re planning to increase the value of your home, this credit building program is a great excuse to finally get started on some home renovations.

  • Start An Education Fund For Your Kids

Sadly, this is something that many Canadians overlook. With the benefits of the secured savings loan, you can now tuck the payout away and watch it grow for your children down the road.

How to obtain a secured savings program

Starting a secured savings program to rebuild credit is easy. All it takes it just a few minutes to fill out an application and you can be approved in less than a day. At Refresh Financial, our credit builder program application is online and only takes ten minutes. As a bonus, as well, once you’ve been approved, you’ll have access to our Financial Intelligence Training, or F.I.T. program which aims to educate our clients about financial well-being and stability. It’s an easy to consume knowledge base that’ll turn you into a money-savvy, financially “fit” saver.

The best practice to rebuild your credit is to start as soon as possible, and stick with the program. Apply for your Refresh Financial program today, and in no time, you’re going to be well on your way to rebuilding your credit and saving for a strong and secure financial future.

Check out this graphic for more benefits of a cash secured savings loan!

cash secured savings loan

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