When financial hardship hits, it’s good to know your options when money coming in doesn’t align with money going out of your household. Because of this, we want to make sure our members know about ways to improve their cash flow so they don’t become delinquent with bills and loan payments. Delinquency is a major negative on credit reports.
Our loans are one of two types: unsecured and secured. Unsecured loans require no collateral and include our credit cards and Personal Loans. Secured loans, on the other hand, require collateral – a pledge of an asset that can be sold in the event of a default. Although we do offer a fixed-rate real estate equity loan, our home equity line of credit (HELOC) option provides ongoing access to cash offered at an adjustable rate based on Prime plus a margin. For members with certificates, a certificate-secured loan comes with an attractive rate. And for members who own their vehicle outright and possess the title, we offer a member-owned vehicle-secured auto loan.
What is a Member-Owned Vehicle Loan?
As previously mentioned, this secured loan uses a member’s paid-off vehicle as collateral. If you own the vehicle outright, there are no liens against it, and it has a minimum value of $3,000, this might be a loan worth considering, especially if you’re looking for some extra cash. Despite the loan name, you’re free to use the funds as you wish. Like all our other loans, the member-owned vehicle loan is subject to our underwriting guidelines and requires the ability to repay.
The minimum amount you can borrow is just $1,000, with a maximum borrowing amount equal to 100% of the value of the vehicle. You can consult online resources to get an idea of the value, but ultimately, we will make that final determination.
The member-owned vehicle loan is just one type of auto loan. The rate and terms for this type of loan are the same as our purchase auto loans, and you’ll apply the same way. You’ll need to send the title to us so we can fund the loan.
As with any loan, give very careful consideration to the amount you want to borrow. Especially because you’re using your vehicle as collateral, you don’t want to take the loan out for more than you know you’ll be able to repay. Missed payments negatively impact your credit score, and in this case, could result in you losing your vehicle.
We’re always happy to answer any questions you may have about this or any other loan option you might be considering. Please call us at 800.237.7328.
For more tips on saving and managing money, visit our Resource Center.
