In this Self credit builder review, I will share my opinion. I also include the pros and cons of their credit-builder account, also known as a credit builder loan. First, let me tell you about my credit history.
How I destroyed my credit
I would tell my younger self to be more responsible with my credit. Like millions of other young women, I fell into the student loan trap.
In addition to my student loans, I was not properly informed when it came time to take out a car loan. It makes me cringe to think about it. Despite having a low car payment, there were still times when I didn’t pay my bills on time. I sometimes didn’t pay it at all. This, along with other things, had a very long-lasting negative impact on my credit.
Although my older self is wiser than I am, it took me many years to improve my credit rating. But, I am proud of my financial achievements, especially in relation to improving my credit rating.
Recently, I was the only person to go into a car dealership. I paid a downpayment and negotiated a fantastic deal. I was able to drive the car home in three hours, with a car that was financed at an amazing interest rate. Because of my poor credit, I wouldn’t have been able this many years ago. Platforms like Self make it easy to rectify credit errors.
About self
Let me tell you a bit about the company before we dive into the Self credit buildinger review.
Self is a fin-tech (financial technology) company that allows you to build your credit. This is particularly useful for those with bad credit or no credit.
Credit-builder accounts, also known by credit builder loans, are small loans that you take out in your own name. Instead of having the funds disbursed directly to your name, Self retains them in the form a secured loan. This is done by depositing the money into a CD (certificate de deposit).
What’s a certificate for deposit?
A certificate of deposit can be a time deposit, which is made available by financial institutions. The certificate can be used to withdraw funds after a specified time. These certificates pay higher interest rates than savings or money market accounts. They are also among the most secure savings vehicles that banks offer.
After the initial loan has been paid off with on-time monthly payments for 12 or 24 month, the lender releases the funds.
This account is unique because they report every payment you make to Equifax, Experian and Transunion.
The Self credit builder loan will help you rebuild your credit without the need to take out a loan or line. Instead, you will be earning a small personal loan secured by your own funds. Cool, right?
Self-offering aDIY method to improve your credit score
You can save money by using the DIY method of Leveraging Self to improve credit. I’m very cautious about the credit repair companies I see advertised online. After doing a Google search for “improving credit”, I almost see them everywhere I go.
There are many scams out there with negative outcomes. I also found a few reviews about Self credit builders online, and decided to give it a try.
Is the Self app legal?
Yes, the Self app works. The app allows you to access your Self Credit Builder loan account and view your account status anytime. Security and privacy are also very important to the company. Multiple layers of data encryption. It is important to understand how Self works, regardless of how great the app might be.
How the Self credit-builder Account works
Once a Self credit-builder account is opened, the terms of service are agreed upon by the consumer with the financial institution Self has matched them with. The account can then be accessed for monthly payments.
As we mentioned, funds in your account are put into a certificate for deposit. The funds are then returned to you at term’s end via direct deposit or check, depending on which option you choose. Self will report all on-time payments to the three major credit bureaus for you.
All accounts have an annual percentage rate (APR), which is lower than what many creditors, such as credit card and auto lenders, would charge. You have the option to pay your account off early and without penalty. The amount of interest that you pay is completely up to you.
FDIC backing is available for all certifications of deposit accounts up to $250,000 (see FDIC disclosure in footer).
The Self Visa (r.Credit Card)
Self also offers a Visa card to help build credit. This secured credit card is secured by a percentage of your savings progress ($100 and more). This credit card’s current APR is 23.99%. Based on the Prime Rate, this APR may vary from the market.
Opening a Self Visa Bank card calls for that you have an open credit-builder account and the complying with already developed:
- Three monthly payments on time
- Save $100 or more
- Your account is in good standing
Open a Self Visa Credit Card
It is easy to open a Self Visa Credit Card. You can set a credit limit based on how your savings are doing in your credit-builder accounts. You don’t have to do a credit check if you already have a Self-credit-builder account. There is no need to spend additional money upfront, as your savings progress secures your credit card and sets your limit.
To ensure that the card arrives at the correct address, you will need to verify your address. To use your card once you have it, activate it. You can keep track of your credit-building progress by monitoring your spending and paying your bills on time each month.
Credit accounts that are in good standing could be eligible for an increase in credit limit. You can also use your card anywhere! Visa credit cards can be used in the U.S.
Self-help is a great option.Credit builder
Self has the advantage of improving your credit score. Experian says that the most important item on your credit report that can affect your overall score, is your ability make timely payments to creditors.
Your credit score could increase if you report to all three credit bureaus each month. You will also be able to make regular monthly payments into a CD which you will get back at the end. This is an excellent way to improve your credit score, without having to make a large financial purchase.
No matter what your credit history, Self can help you improve it in order to prepare for a future event, such as buying a house or a car. Higher credit scores allow you to access more traditional financial products. You can also save thousands of dollars on interest over the long-term.
Self also offers 24/7 access via an app on your smartphone and an online account wherever there is internet access.
As mentioned above, you will also be able to open your own Self Visa Credit Card. It’s easy as pie. There is a FAQ page and additional support for those who need it. It’s an easy tool that you can use to improve your financial health.
Self-employment: The pros and cons
The main problem is the expense of the fees (the interest and one-time administrative fees) that you will have to pay. You will not be eligible for the funds until your credit builder loan is paid off or all payments have been made according to your agreement.
Your savings progress will determine your limit for the Self Visa Credit Card. At 23.99%, the APR is high. It’s best to plan to pay your entire balance each month to help build your credit.
When considering a loan, make sure you weigh the pros and cons.
How to open a self account
These requirements are required to be able to open a Self-account:
Requirements for credit builder accounts
In order to qualify, you must:
- A valid social security number
- A checking account or prepaid card
- Legal residency in the United States
- You must also be at least 18 years of age.
Income requirements
It’s good news! It is possible to open an account without a minimum income requirement.
Verification of identity
You may be asked verification questions if you have a credit history. You may have to take additional steps to verify that you are not a credit card holder. This will be explained to you during the application process.
Is the self credit builder right?
This self-credit builder review will help you determine if it is right for you. People who are trying to avoid debt and live a minimalist lifestyle might also like the fact that their money is being stored in a CD, which will be returned to them.
This is more appealing than buying frivolous stuff they don’t need. Marie Kondo is so popular because you can’t live with useless stuff.
If you intend to use the Self account as an emergency fund, or in lieu of one, it is not a good idea. You cannot access funds immediately. If you have an emergency and need cash quickly, it is best to start a Self account before you pursue this.
Many customers have written glowing reviews about Self credit builders online. While this may make some people skeptical, I am a big fan and believe the reviews. After speaking with Self many times, including at FinCon, it is clear that they are a financial product that wants to help others.
They recognize that poor credit is a major reason people are being taken advantage. They are now trying to change the face of the financial industry. I love the idea of putting people before profits. This makes me feel more than just another number in a large corporation.
Reminder: It is important to improve your credit score
For those who want to spread the message about improving credit, this is the best tool you have for your financial health.
Why?
Everybody, from a landlord or employer, can use your credit report to deny your opportunities. The deciding factor is solely based on your financial past.
What does a low credit score mean?
You are vulnerable to financial products and services that don’t have a good credit rating. These services and products will cost thousands of dollars in interest and fees. Because they know that you have few options, banks will profit from your low credit score. This means they can make more money.
Your credit score may not be high enough to be eligible for financial services. This is why car lots that offer “Buy Here, Financing Here!” are so popular. Another reason is the increase in payday loans and check-cashing service fees.
You don’t have to be able to get the best financing for large purchases like a house or a car. Even if you don’t plan to buy, a low credit score could cost you housing. Background checks are often done by landlords and include credit reports and scores.
Someone else could take your place if you’re a financial liability. They will do so because they have proven they can pay their bills on-time. You’re right!
The list doesn’t end there. Utility companies might ask you to make a large deposit upfront. This is done to protect you from being late on a bill. Your credit score is far more important than you realize.
Many of us will need to rebuild or improve our credit. However, there are still options. It is possible to repair your credit using many tools. Self is one of these companies that are leading the charge.
Final thoughts about my review of the self-credit builder
My personal review of the Self credit builder may help you make a decision about whether it is right for you. If you are looking to build or reestablish your credit, then the self credit builder may be a great fit for you. It may help you get the credit score that you desire with its flexible plans and easy online platform.
