How Can I Start Building Credit?

Building credit is a common concern for teens and young adults. You need a good credit history in order to get an auto loan or credit card, and sometimes even contractual items like phone plans.

The following Sunward products can help you establish credit.

CERTIFICATE SECURED CREDITLINES

A Certificate Secured CreditLine uses the balance (minimum $500) in a Term Certificate as collateral. Sunward will hold those funds until the balance of the loan is paid in full, so there’s little risk to you. By borrowing and repaying the loan, you demonstrate fiscal responsibility.

• No co-signer or credit history needed
• The certificate's balance will continue to earn dividends higher than savings account dividends
• Low loan rates, just 1% higher than the certificate earns

If you are in a position where you cannot afford to have your funds held as collateral, an adult with at least $500 in a certificate may agree to provide your collateral.

SAVINGS-SECURED LOANS

If you haven’t saved enough for a Certificate Secured CreditLine, a savings account with at least $500 may be used for a Savings Secured Loan. There is little risk in mismanaging the loan since the Credit Union will hold those funds. The benefits of a Savings-Secured Loan include:

• No co-signer or credit history needed
• The savings account's balance will continue to earn dividends
• Low loan rates, just 1% higher than the savings account earns

If you are in a position where you cannot afford to have your funds held as collateral, an adult with at least $500 in a savings account may agree to provide your collateral.

ANY CO-SIGNED LOAN

You can apply for an auto loan, credit card, or any Sunward loan when you have an adult co-signer with good credit. Please know that co-signers are held liable for your debt if you fail to make a payment.

• Credit history only needed for the co-signer
• Apply for any type of loan

BUILD A GOOD CREDIT HISTORY THROUGH REGULAR PAYMENTS.

In the options above, you must take funds from the loan or CreditLine and make on-time payments for at least six months. You can even set up automatic payments for extra assurance. This cycle of borrowing and repayment builds good credit.

We’re here to help. If you have any questions about your situation, or you’d like to apply for a loan, apply online, call 505.293.0500 or 800.947.5328, or visit any branch.