A share secured loan is very simply a loan which is secured or guaranteed by money in your shareholders account.  This is an attractive loan option and provides a low risk way for your Credit Union to loan you money.

In many cases, before a Credit Union provides a loan to one of its members, it assesses the credit risk involved and makes decisions accordingly.  If the applicant’s credit profile is weaker than normally acceptable, the Credit Union may still elect to issue the loan, providing the applicant can guarantee all or part of the loan amount with money from his/her account(s).

An attractive aspect of a share secured loan is you are still able to receive interest payments on the money you have pledged as collateral for the loan. Therefore, the net interest charged against the loan is relatively small. Credit Unions find these loans beneficial because their members are very likely to maintain good payment history in order to avoid any risk of losing the assets they have pledged.

A share secured loan is a great way to establish credit for someone who has not yet taken out any loans.  The Credit Union would report the payment history to credit reporting agencies, thereby allowing the member to build a strong credit profile.

The application process for a share secured loan is pretty simple and straightforward.  It can be processed quickly, providing you have sufficient funds available in your account to secure the loan.  Your Credit Union Member Service Representative can answer any questions you may have in this area to help you to get started right away.