Share/Deposit Secured Loans

BORROW…SECURED

Your savings account at EXCEL doesn’t only help secure your financial future, it can also be the collateral for a low-rate loan.

Are you looking for an affordable personal loan option with a fixed interest rate? A share or deposit secured loan may be a great choice for you.

Deposit secured loans use your savings account or a Certificate of Deposit (CD) as collateral. They are easy to repay through a monthly fixed rate. Deposit secured loans are a great option for people with lower credit scores who may have trouble taking out a traditional personal loan. After reviewing your online loan application, a team of financial experts will help you through the process. If this sounds like the right loan option for you, or if you would like to receive more information, please call or text us at EXCEL today.

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Our lowest interest rates

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Excellent way to build or repair credit

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Secured by your balance in EXCEL savings

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Access to funds without depleting savings account or share certificates

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Deposits continue to earn dividends

Have questions? We have answers! Here are some FAQs:

WHAT IS A DEPOSIT (SHARE) SECURED LOAN?

A deposit secured loan is a type of personal loan secured with money from your savings account or CD as collateral. Instead of draining your savings on a major purchase, you can take out a loan and borrow against an equal amount in your account. This gives you extra time to rebuild your savings and allows you to continue earning interest on your savings throughout the payment term.

During your term, you’ll repay the loan through fixed monthly payments with a low annual percentage rate (APR). Your monthly payments can come out of your EXCEL checking account or a different one, just not the share account you’re using as collateral. The annual percentage rate (APR) will stay the same throughout your payment term, even if you take several years to repay your loan.

HOW DOES IT WORK?

Once we approve your loan application, we’ll place a hold on your savings account or CD for the amount equal to your loan amount. We will then grant the funds you requested through a check or direct deposit into your checking account. You can begin making monthly payments on the loan manually or through automatic withdrawal.

The minimum amount you can borrow through this loan is $500, and the maximum amount is 100% of the balance in your savings. With each monthly payment you make, we will release the hold on your account for that amount, so you will slowly regain access to your collateral funds.

BENEFITS OF DEPOSIT SECURED LOANS

Borrowing a deposit secured loan has many benefits:

  • Lower interest rate: Deposit secured loans offer lower interest rates than other personal loans. Their rates are usually about 1% to 3% higher than the dividend rates on your savings account or CD, and because you will continue earning dividends on your savings, your loan may end up being fairly inexpensive.
  • High approval: Loans that use collateral have higher approval rates than those without, so people who do not qualify for unsecured loans typically qualify for this type.
  • Quick approval: We can approve your application in as little as one business day, so you will see your money in your checking account more quickly than you would with other loans.
  • Flexible terms: Because your own money is used as collateral, you have control over the payment term. This means you can choose a term that works best for your budget.
  • Convenience: Once we approve your application, you can use the funds that you borrow for any purpose, whether it’s making a major purchase, paying off credit card debt, or anything else.

Share secured loans offer many benefits, but you should always search through all of your options to find the one that best fits your financial needs. Call or text EXCEL to learn more information about our various loan opportunities, or visit our website to search for a loan that better suits your needs.

WHO CAN QUALIFY?

Many people who would not qualify for other loans due to poor credit can still receive this type of loan. The main qualification you need is a savings account or CD with EXCEL that you can use as secured financial collateral. You will need to have a high enough balance in your account to cover the principal of the amount you borrow.

ARE THERE DOWNSIDES TO BORROWING?

If you decide to borrow a deposit secured loan, you will want to be aware of a few associated risks. Unlike other loans, they present risks to you rather than to the financial institution; in other words, if you cannot repay the money, you will lose the funds in your collateral account.

Similarly, borrowing any loan will cost you a little bit of money in interest. Some people would rather pay for a large purchase out of their savings or through credit cards than take out a loan so that they don’t end up paying additional fees with the annual percentage rate. If you have adequate funds in your account to pay for your purchase and cover an emergency, you may decide not to borrow any money at all.

If you’re unsure whether to apply for this type of loan, we can help. Schedule an appointment with one of our loan experts today to receive financial advice about the best options for you.

HOW DOES A DEPOSIT SECURED LOAN AFFECT YOUR CREDIT?

Deposit secured loans can boost your credit score. Repaying them on time can be healthy for your credit because it shows financial institutions you are financially responsible, making them more likely to approve you for bigger loans in the future.

You can also use these loans to pay back credit card debt or other forms of debt that have a higher interest rate, which may help you increase your credit score further.

However, if you miss a payment or fail to repay the money you borrowed, your credit score will drop. You may want to be sure that you can afford your payments before you apply.

WHAT HAPPENS WHEN YOU PAY OFF A DEPOSIT SECURED LOAN?

Once you completely pay off your loan, you will regain access to your collateral funds. We’ll drop any remaining holds on your savings account or CD, and if you made your payments on time, your credit score will increase.

MORE QUESTIONS? CONTACT US TODAY!

A share secured loan can help you afford a big purchase, pay off your credit cards, or simply boost your credit score without draining your savings. Our fixed interest rates and flexible terms make these loans affordable and practical, and you can receive your funds in as little as one day.

EXCEL can help you decide if this is the right option for you. Call or text us today to speak with one of our loan experts and learn more information about how to secure a loan through our credit union. 

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