When you’re just starting out or have made some credit mistakes in the past, it may feel like an impossible task to build your credit score. You can’t get approved for most credit cards or loans which can help you build up your credit.
Enter a solution called Credit Strong. This financial product is a credit building loan that allows you to basically make “payments” to yourself which report to all three major credit bureaus.
The special bonus of opening an account is that at the end of your repayment term, you get access to the money! Credit Strong helps people with credit building and saving at the same time.
If this is something that piques your interest, then you may want to learn more. Our Credit Strong review will provide you with all the ins and outs of this financial product so you can make the final decision. Ready to find out if Credit Strong has the loans and credit building features you need? Let’s get started!
What is Credit Strong?
Credit Strong is a fintech site that offers Credit Builder Loans to help people build their credit score. It is designed for those who don’t have a credit history or bad credit.
Digital Marketing Director, Valerie Rocco has said that “The mission is to help Americans build up their score so they aren’t caught up in the cycle of bad credit.”
Once someone is caught up in this cycle of bad credit, it can be difficult and expensive to get out of. For example, let’s say you missed a few payments on your student loans because you had trouble finding a job after college. If you qualify for a loan with poor credit, your interest rates are typically sky-high.
This makes it difficult to make your monthly payments on time. If you miss a monthly payment on a traditional loan, then your credit score will take a hit.
Austin Capital Bank
Credit Strong is a division of Austin Capital Bank. Founded in 2006, Austin Capital Bank is a community bank that serves communities in Texas.
It is considered a highly rated and top-performing financial institution in the state of Texas.
The banking services are provided by Austin Capital Bank in the greater Texas community. Credit Strong operates all across the country, with the exception of North Carolina, Wisconsin, and Vermont.
Since Credit Strong is supported by a financial institution, they provide FDIC-insured products. This means that your money with Credit Strong is secure.
What are Credit Builder Loans?
A credit builder loan is for people who have no credit history or are working on rebuilding their credit. You aren’t required to have a good credit score to get approved.
Your loan payments are typically reported to the credit bureau to help build a positive payment history. Unlike a traditional loan, the amount that you borrow is held in a bank account until you finish your monthly payments.
The money typically can’t be accessed until you have repaid the loan. This also lowers the risk for the lender who is taking on individuals with little credit history or a low credit score.
These are installment loans that are reported to the credit bureaus. They are reported to at least one, if not all three major credit bureaus, varying by the product offering itself.
Payment history is the most important factor in credit scoring models such as VantageScore and FICO. These loan products help you build credit by reporting your positive payment history to the credit bureaus.
“Fresh Start Loans” and “Starting Over Loans”, are other names for these credit builder products. These types of loans are typically offered by smaller financial institutions, like a community bank or credit union.
Credit building loans are also not widely advertised.
What does Credit Strong Offer?
Credit Strong offers an installment loan that helps you build credit and savings at the same time. You don’t receive the money upfront like a traditional loan.
Instead, the money is deposited into a savings account and you make fixed monthly payments.
The loan does accrue interest, however, the savings account does as well. This helps to offset the interest on the loan part of the product.
Customers can build or rebuild their credit score by making their payments on time each month. Your payments are reported to all three major credit bureaus – Experian, TransUnion, and Equifax.
With Credit Strong, you can choose between a Personal or Business Credit Strong Loan.
Credit Strong Personal Products
If you’re an individual who wants to improve or build their credit score, Credit Strong has personal credit-building products that could help. A good score can help you get approved for loans (mortgage, auto, personal, etc.) and get a lower interest rate.
This plan starts at $15 a month, making it the most affordable option to start building credit. You can build credit for up to 120 months.
It reports an installment debt of $1,000 to the credit bureaus. If you wish to close the account earlier, you may do so without facing any fees or penalties.
There is a one-time, non-refundable administrative fee of $15. The annual percentage rate on the Credit Strong loan is 13.50%.
This plan starts at $30 a month. You can customize your payment terms for up to 120 months.
It reports an installment loan of $2,500 to the credit bureaus. There is no fee or penalty for closing the account early.
There is a one-time, non-refundable administrative fee of $15. The annual percentage rate on the Credit Strong loan is 7.75%.
Build & Save 1000 – 12 months
This plan is $89 per month and builds 12 months of credit history. It reports an installment loan of $1,000.
There is a one-time, non-refundable fee of $8.95. The annual percentage rate on the loan is 14.04%
Build & Save 1000 -24 months
This plan is $48 per month and builds credit for 24 months. It reports an installment loan of $1,000.
There is a one-time, non-refundable administrative fee of $8.95. The annual percentage on the loan is 14.89%.
Build & Save 2000 – 24 months
This plan is $96 per month and builds credit for 24 months. It reports an installment account of $2,000.
There is a one-time, non-refundable administrative fee of $8.95. The annual percentage on the loan is 14.43%
Credit Strong’s magnum loans are for those who wish to demonstrate repayment on larger credit obligations. this plan will report an installment account of $5,000.
This loan is designed for people who are looking to prime their personal credit score to reach business credit goals. Many lenders will look at a borrower’s personal credit history as part of the commercial loan credit decision.
It runs $55 per month and you can build credit with payment terms for up to 120 months.
You may cancel at any time without any penalties or fees.
There is a one-time, non-refundable administrative fee of $25. The annual percentage on the loan is 5.907%.
This is the bigger option for customers who wish to demonstrate their ability to repay larger credit obligations for the goal of improving their business credit.
This account will be reported as an installment loan of $10,000.
It runs $110 per month and you may build credit with payment terms for up to 120 months.
You may cancel at any time without any penalties or fees.
There is a one-time, non-refundable administrative fee of $25. The annual percentage on the loan is 5.851%.
Credit Strong Business
Credit Strong recently started offering customers a credit-builder product for business credit. It allows you to build business credit for your company, without using your personal credit.
Their website doesn’t provide specifics on the program. However, what we do know is that if you are approved, your loan funds are locked into a business savings account to secure the loan.
You will make small monthly payments and can build up to 120 months of payment history.
Credit Strong will report your payments to the business credit bureaus to build your company’s credit profile.
You also get access to your Equifax Business Delinquency Financial Score Grade for free each month. This allows you to track your progress.
Your business credit builder loan can be canceled at any time without any fees or penalties for closing the loan early.
How does Credit Strong Work?
You can apply for an account through their website and then apply for a credit builder loan. They do not do a hard inquiry credit check. That means your credit score won’t drop due to opening up a Credit Strong account.
Without a credit check, it is also possible to open up an account with Credit Strong with poor credit.
Once your Credit Strong account loan is approved, the loan amount will be placed into a savings account. This account is then locked so it is inaccessible until the loan is paid off.
This savings also earns a fixed interest rate. The interest accrued is at 0.01%, which is pretty low.
When you make your loan payment each month, which includes principal and interest payments, the principal amount will be deposited in your savings.
Credit Strong keeps the accrued interest as their revenue. Credit Strong reports each successful payment to all three credit bureaus.
By building an on time payment history, you will also build your credit. Your overall credit score should improve over time.
Once you’ve paid off your Credit Strong account, the locked savings account balance will be released. You will now have access to the funds, including the interest that’s earned from the savings account.
The funds can be transferred to a different account or you may leave your money in Credit Strong’s savings account.
How to apply for a Credit Strong Account
You will need the following to open an account with Credit Strong:
- Be a permanent US resident and currently reside in the U.S.
- At least 18 years old
- Have a valid Social Security number
- Have a valid checking account, debit, or prepaid card in good standing
- Provide a mobile number and email address
You don’t need to provide an upfront security deposit and Credit Strong does not pull a hard inquiry on your credit. There is no minimum income required and you don’t have to have a credit score to apply.
It is available in states, except North Carolina, Wisconsin, and Vermont.
How Long Does it take Credit Strong to Increase Credit Scores?
There are many different types of credit score systems. The FICO credit score and VantageScore are two of the most widely used.
The items that are found on your credit report are factored into each of these scoring systems. Payment history is the most influential factor in that’s found on your credit report.
If you’re new to credit, it also will take at least 6 months to get your first score with FICO.
Your improvement with Credit Strong will depend on your personal credit situation. For example, if you have ten years’ worth of bad credit habits, you will need more work than someone who has made only a few mistakes.
Credit Strong’s loans will increase your score to the extent that depends on how long you have the loan for. For someone who has a long history of bad credit, a 12-month Credit Stong account may not increase as much as other options.
Is Credit Strong Legit?
Yes, Credit Strong is backed by a financial institution which enables them to offer FDIC-insured accounts to their customers. They are a legitimate company that uses secure encryption to protect your account information.
Credit Strong Pros
Reports to all Three Credit Bureaus
Some credit builder products only report to one or two bureaus. You receive the maximum benefit of all three credit reports from the bureaus having that history of positive payments.
Doesn’t Require a Credit Check
There is no hard pull on your credit to open this secured consumer installment loan. Your credit should not be affected by applying for a credit builder account.
No fees for early termination or prepayment
If you close your Credit Strong loan early, there are no fees or penalties that must be paid to do so.
Have long Payment Term options
You can choose payment terms for as little as a year to up to ten years. Depending on how much help you need with your credit, you can pick a term that works for you.
You can rest assured that Credit Strong service is secure. Many fintechs don’t have the backing of an established financial institution. This puts you at risk of losing your money if the company goes under.
Credit Strong is backed by a bank that is FDIC insured. That means that Credit Strong accounts are safe.
Build Savings at the same time
When you finish making your payments, you get access to the money that’s been secured in a savings account. That money can be used for emergencies, other expenses, or to build savings.
Credit Strong Cons
Some Interest Rates are High
Credit Strong’s interest rate on some of their plans is higher than a traditional personal loan. There are other ways like opening up a secured credit card account that could be a less expensive way to build your credit.
Must have a bank account, debit card, or prepaid card in Good Standing
To qualify for a Credit Strong account, you must be in good standing and have one of these banking products. For some people who are in a bad credit situation, they may not have one of these accounts or it may not be in good standing, which will disqualify them from Credit Strong.
Not a Loan Solution
If you need a loan to cover an expense, Credit Score is not right for you. That is because you don’t receive cash until the end of the repayment term.
It’s not actually a loan in the first place. If you need a loan for extra cash, you will need to look to other solutions.
Can’t have a Co-Owner
Credit Score is made for individuals. Therefore you can’t share an account and improve your credit with another person.
Credit Strong Reviews are Mixed
It is hard to get a gauge of what customers think of Credit Strong. One of the most noticeable trends you can find on Credit Strong reviews is that many of the negative reviews are because of confusion over how the account works.
Anyone who is applying for Credit Strong that is expecting to receive the money up-front will be surprised and disappointed.
FAQ: Credit Strong Review
Is Credit Strong a good value?
Credit Strong does not charge a fee or penalty if you choose to cancel your account early. However, there are some fees that you need to be aware of.
All the plans charge an administrative fee that ranges from $8.95 to $25. This is not too concerning.
The interest rate on the loan can be between 5.851% to a whopping 14.89%. Once you get into double-digit interest rates, it can get expensive quickly. Depending on the credit line and repayment term you choose, Credit Strong can end up costing you thousands of dollars.
Does Credit Strong offer a variety of plans?
Credit Strong offers a slew of different plans that can fit every budget. Depending on your credit situation, you can choose a repayment term that makes the most sense.
If you suddenly need access to the money or feel that your credit has improved(or not improved as expected), you can cancel the account early. You don’t have to worry about paying fees or penalties to do this.
How is the Credit Strong customer service?
You can reach a member of Credit Strong’s customer support team by phone at 833-850-0850 from Monday to Friday, 7 a.m. to 7 p.m. Central time.
They also have chat available on their website from Monday to Friday, 8 a.m. to 5 p.m. Central time. There is an extensive FAQ page that may answer your general questions about Credit Strong
Is Credit Strong easy to use?
It is very easy to sign up for Credit Strong. The experience is straightforward and fast. The requirements to sign up for an account are minimal. There is also no credit required.
Can Credit Strong effectively build credit?
Your payment history is the biggest factor that determines your credit score. Credit Strong can definitely help boost your score as long as you make timely payments.
You have plenty of options that allow you to choose a budget and term that suits your finances.
Opening an account with Credit Strong does involve opening installment debt. This can also help your credit mix in your credit history. In the short term, keep in mind that when you up a new credit or loan account, your score will take a dip.
Credit Strong Alternatives
There are other viable solutions to repairing your credit, other than Credit Strong. A secured credit card is one example.
Self Lender is another example. It also offers credit builder loans. Monthly payments start at $25 a month, there is no hard pull on your credit, and they also report to all three bureaus.
There is a one-time non-refundable administrative fee of $9. The annual percentage rate is $15.97%.
Bottom Line: Credit Strong
Credit Strong is an effective way to improve or build your credit. You also get a savings account at the end which can be especially useful if building savings is another financial goal.
It can get expensive and if you need money now, Credit Strong may not be the best solution. Make sure that you look at other potential options before opening an account.