Credit Builder Loans

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Most companies use credit scoring to help them analyze information so that they can make objective, consistent, fair, and quick lending decisions. A credit score is a result of analysis of scoring models and computerized formulas based on how millions of consumers have performed in repayment of debt over time.

Everyone’s credit journey has to begin somewhere. It might seem impossible to begin when creditors keep denying your applications due to your lack of credit. Building credit can be tricky. If you don’t have a credit history, it’s hard to get a loan, a credit card or even an apartment. Don’t get discouraged! When you’re just beginning to build your credit, consider starting off small and looking for options available for those with little or no credit.  It IS possible to build your credit score with a Sky Federal Credit Union Credit Builder Loan!

There are many different credit score models produced by a number of different companies. To establish a FICO score, for example, you need at least one account that’s been open for six months or longer, and you need at least one creditor reporting your activity to the credit bureaus in the last six months.

Our Credit Builder Loan helps our members build credit when they have limited or no credit history, or wish to improve their credit score!

With a Sky Federal Credit Union Credit Builder Loan the money you borrow is deposited to your savings account with a hold on the funds. As the loan is repaid, the proceeds become available to you. Your monthly payments are reported to the credit bureaus to create your score.


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Credit scores not only consider the number of late payments, but they also balance negative information against all other positive details in your credit history. Sky wants to make sure you get your credit history off to a good start. It’s important to pay your bills on time! Late payments can stay on your credit reports for seven years and wreck your score.  Try to make each payment on time!

So many factors can impact your credit score, maybe you have a score but are looking to improve it. Sky offers FREE Credit Score Analysis, where you can sit down with one of our staff and review past and present activity. We will explain how the score has arrived at its current value, and what areas can be addressed to improve your credit score.

Unfortunately, it’s a lot easier to destroy your credit than it is to fix it, so try to look at this new journey as an opportunity to form good habits and start your credit history off right. The time and effort you put into building this solid foundation might eventually get you the best credit cards, loans and rates and may end up saving you money.

Building a good credit score takes time, if you have no score it probably will take at least six months of on-time payments. Practice these good credit habits to build your score and show that you’re creditworthy:

    1. journey3Make 100% of your payments on time, not only with credit accounts but also with other accounts, such as utility bills and monthly rent.  Bills that go unpaid may be sold to a collection agency, which will seriously hurt your credit.
    2. Keep your credit card debt low. When trying to build credit we recommend paying your balance in full each month, but if you do carry a balance from month to month, don’t let your debt balance exceed 30% of your credit limit. This looks good to creditors because it shows that you use credit but aren’t overly reliant upon it.
    3. Avoid opening too many new accounts at once; new accounts lower your average account age, which makes up part of your credit score.
    4. Keep accounts open for as long as possible. Unless one of your unused cards has an annual fee, you should keep them all open and active for the sake of your length of payment history and credit utilization.
    5. Check each of your credit reports annually for errors and discrepancies. Consider a Sky Secure Checking with ID Protect. With a Sky Secure Checking account you receive daily credit file monitoring and automated alerts of key changes to your Experian, Transunion, and Equifax credit reports.  It includes a 3-in-1 credit report every 90 days or upon receipt of a credit alert.  It is a great tool for monitoring your credit!

Call us at (800) 445-3328 or email us at memberservices@skyfcu.org and speak to one of our Financial Services staff for more information.

Federally Insured by NCUA