Use your own savings to secure a loan.
Need to make a purchase but don't want to wipe out your savings? Or perhaps you're looking to build or repair your credit? A Collateral Loan from BankFive could be the answer!
Sometimes referred to as a Secured Personal Loan, or a Passbook Loan, this type of loan allows you to borrow money using the funds in your deposit account as collateral. You get the money you need, without having to drain your savings or face early-withdrawal penalties by cashing in a CD before it matures. And, by making your payments on time, you'll establish credit history and creditworthiness, all while paying a lower interest rate than you typically would with a credit card or an unsecured personal loan.
Borrow against your assets:
- Minimum loan amount of $500
- Borrow up to 95% of the balance in your BankFive savings or CD account*
- Interest-only and Installment options available
- With the Interest-only option, you pay only 3.00% over the rate of the savings or CD account used to secure the loan, and payback terms are flexible**
- With the Installment option, the rate is 3.50% over the rate of the savings or CD account that is securing the loan
- Apply Online - just select "BankFive Deposit Account" as the Collateral Type
So, what's the difference between Interest-Only and Installment Collateral Loans?
Interest-Only Collateral Loans:
- You are billed quarterly for interest only. There is no set amount of principal that you must pay each month (you decide), but you will be charged interest until the amount borrowed is repaid in full.
- The interest rate is 3.00% over the interest rate of the savings or CD account being used to secure the loan.
Installment Collateral Loans:
- You will make fixed monthly payments for a set period of time. Payments include both principal and interest.
- The interest rate is 3.50% over the interest rate of the savings or CD account being used to secure the loan.
*During the term of the loan, you may not make withdrawals from the savings or CD account that is being used to secure the loan.
**The loan term for CD secured loans is based on the remaining term or maturing date of the CD account.
Learn about other loan options and check current rates.