Our Debt Management Loan is for members who have been working to or would like to work toward improving their credit. It is designed to assist members who may be struggling with credit.
The Debt Management Loan is not based on a credit score. The interest rate for the loan is based solely on the term of the loan. The minimum loan period is 24 months and the maximum term is 48 months.
Borrowers have the opportunity to reduce their interest rate during the loan period. Since the purpose of the Debt Management Loan is to help members repair their credit, after 6 months of continuous payments members can request a “soft pull” credit review. When the member’s credit score has increased by a letter grade we can reduce the interest rate on the loan by 1.00%! For the life of the loan, the member can request a review every 3 month. Each letter grade improvement will achieve an additional .25% interest rate deduction. The maximum rate reduction for the full life of the loan is 2.00%
If you are looking for the catch, well, there really isn’t one. There is one requirement. Prior to closing on a Debt Management Loan the member must complete at least one Financial Wellness Program meeting with a Windsor Locks FCU Certified Credit Union Financial Counselor. This meeting will review the member’s current financial condition, focus on meaningful budgeting skills and set the framework for achieving the member’s credit improvement goals.
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Check out our Financial Wellness Program