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Best Credit Builder Loans for Students

April 1, 2020Uncategorized

A positive credit rating can help you achieve your next financial goal in the next few years. But as easy as it sounds, improving your credit score is not easy at all. In fact, half of the population of the United States lingers in bad credit. So, how can you, as a college student improve your own credit despite the financial challenges that face?

According to many credit experts, the definite choice here is opting for credit builder loans. These are not ordinary loans but a special kind, where you do not need to have a lot of money in the money to qualify for the terms.

Credit builder loans are the exact opposite of the regular loans available at the banks. Here you can avail an amount starting from a few hundred dollars to a few thousand, depending on the financial body offering. The loan amount is not immediately given out to you. The bank freezes the amount and opens up a savings account where you have to make monthly payments. Once the repayment term is met successfully, the bank transfers the entire amount into your account for you to avail.

These types of loans are usually acquired to improve credit history. Students would need to acquire certain financial facilities where a strong credit is a prerequisite, so before starting out your career, choosing the best credit builder loan would be the way to go.

Here are some of the options for the best credit builder loan for students:

The best credit builder loans are offered by banks, online lenders, and credit unions. We do not recommend you to go around non-profit organizations. These financial institutions offer credit builder loans that generally entail an interest, processing fees, repayment terms, and principle loan amounts.

If you, as a student are looking to opt for a credit builder loan, you must look at your options and find a financially sustainable choice. Also, make sure your lender reports all of your reporting to TransUnion, Experian, and Equifax. Lastly, be mindful of the interest rates; you do not want to end up paying huge amounts that accumulate due to interest.

Self Lender

Self remains the most practical online platform which was previously called Self Lender. It received an A-BBB rating for its service. The platform’s website has interactive features where all the information regarding sign up and processing is mentioned. It is a user-friendly platform. Loans provided by Self are FDIC insured and you can also close off your account early on.

  • Loan Amounts offered: $600 – $1,800
  • General Term Length: 12 – 24 months
  • Lowest APR: 15.92%
  • Processing Fees: $9 (administrative fee)

Heartland Bank

This bank earned an A+BBB rating and they developed a Small Dollar Loan Program for this facility. Their program lets you build/repair personal credit. Your sum is directly allocated into a savings account and these funds earn interest on repayments.

  • Loan Amount Offered: $500 – $1,500
  • General Term Length: 12 months
  • Lowest APR: 14.65%
  • Processing Fees: $25 (document fee)

Republic Bank

The Republic Bank has a C-BBB rating and experts suggest that their program can improve your credit history in a year. They have a Certificate of Deposit (CD), where you keep your money and earn interest on every penny paid in repayments.

  • Loan Amount Offered: $500 to $1,500
  • General Term period: 12, 18, or 24 months
  • Lowest APR: 6.37%
  • Processing Fees: $10

Metro Credit Union

This institution holds an A+BBB rating and according to most people, it remains a top-rated choice in America today. They open up a Metro savings account for you where funds are directly deposited, and as usual, you get to earn interest on repayments.

  • Loan Amount Offered: $500 – $3,000
  • General Term Length: Up to 24 months
  • Lowest APR: 4.10%
  • Processing Fees: None

Digital Federal Credit Union

This credit union currently holds an ABBB rating and they open up a DCU savings account for loan repayment deposits. They also have a rating of 3 out of 5 stars mentioned on their website.

  • Loan Amount Offered: $500 – $3,000
  • General Term Length: 12 – 24 months
  • Lowest APR: 5.00%
  • Processing Fees: None

So, there you have it – some of the best credit builder loans for students in 2020. Plus, if students are looking for student loan help, pay off student loans, and moving into the professional life and adopting careers as teachers, there are also a number of plans for loan forgiveness for teachers.