Step 3: Save For Good Credit! Did you know you can use a savings account to establish or repair your credit? Follow these 5 simple steps and you can start to rebuild your credit right away! 1. Open a Credit Union Savings Account Call your local credit union tell them you want to open a savings account. Depending on the credit union you may need about $500.00 to make this program work. If you dont have enough cash yet, dont wait. Open your account with the minimum requirement and begin to deposit as often as you can. 2. Take out a Loan Secured by Your Savings Once your account is open and has the minimum savings required, take out a Secured Share Loan. This loan will be secured by your savings. In most cases you can choose any repayment terms you like. I advise a 12 month repayment. Once you have only 10 months left, most lenders will not count the payment against your debt load! 3. Deposit the Loan back into Your Account Don't go on a shopping spree! Have the loan funds deposited back into the savings account. Now your account will show double the amount you placed in savings... For example: $500 for your savings (the secured amount), and $500 from your loan. 4. Set up Automatic Drafts to Pay Back Loan Have the monthly payments for the loan drafted from your savings account. Now the loan is repaying itself! Add just enough money to cover the interest on the loan. One great feature of this program is that if you ever need your $500 for an emergency, simply have the loan completely paid off with the remaining loan funds in the account and your savings will be released... With no additional debt! 5. Rebuild Your Credit... Using Your Savings! Try to find a credit union that reports to ALL three major credit bureaus... Equifax, Experian and TransUnion to bring up the middle score! |
