Reviews, Small Business

Funding Circle Small Business Loan Review

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The editorial content on this page is not provided by any financial institution and has not been reviewed, approved or otherwise endorsed by any of these entities.

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If you’re looking for a quick way to borrow money to run your business, Funding Circle may be the answer. Funding Circle is an online marketplace that connects investors with small businesses that need funding to expand, purchase new equipment, hire new employees or market products.

The loan terms offered are 1 to 5 years and you can borrow $25,000 to $500,000. Fixed rates are available from 5.49% to 27.79%. The Funding Circle application process is fast and painless plus its terms are transparent. 

Loan Details

During the application process at Funding Circle, you have to turn in 3 years of recent business tax returns, a recent personal tax return and 6 months of recent bank statements. If you need to borrow over $200,000 you’ll also have to provide a YTD balance sheet and income statement

To take out a loan, first you complete the online application. Afterwards you’ll hear from a loan specialist within 2 hours who will help you gather documents for final verification. When your paperwork clears you can receive funding within 1 to 2 weeks.

At minimum to qualify you must have the following:

  • 2 years of operating history
  • A FICO score of 620 or above
  • Annual revenue over $150,000
  • No bankruptcies in the last 7 years
  • No more than five tax liens in the past 10 years

According to Funding Circle, during the underwriting process both technology and a representative will review your application for loan offers. Online customer reviews and real-time cash flow are factors, other than your credit score, that an underwriter may use to weigh your application.

Loans through Funding Circle are secured so you’ll have to pledge an asset as collateral for the loan. This means the lender can take ownership of your property if your loan falls into default. Funding Circle allows you to pledge home equity, vehicles, equipment, accounts receivable or cash savings to secure your debt. 

Fees and Gotchas

The Funding Circle loan is very straightforward without many fees or fine print. It charges an origination fee of 0.99% to 6.99% based on your credit strength. Your origination fee is deducted from the loan amount, so it only applies if you’re approved and your loan is funded. There are no fees for prepayment of a loan. The late fee is 10% of your missed payment amount and the non-sufficient fund fee is $35. 

Pros and Cons

Funding Circle has competitive rates especially if you have an excellent credit score and a solid business. You can also receive funding quickly and you’re assigned a loan specialist who will personalize loan offers to meet your business needs.

Another perk of the application process is it’s handled entirely online so you don’t have to deal with the hassles of getting approved from a brick-and-mortar bank. And the terms are stated very clearly on the Funding Circle website; you won’t have to worry about any surprises.

One downside of Funding Circle is the collateral requirement applies to all loans. Of course pledging your assets as loan collateral won’t impact you, if you can pay off your small business loan without incident (which everyone plans to do). But you risk loss of assets in the future if something happens and you can’t pay.

In addition, just like any other small business loan if your credit score is average or your business isn’t performing well you’ll have a higher interest rate.

Funding Circle

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Alternatives to Funding Circle

Thankfully, you have many small business loan options online with easy applications and low interest. Two you may want to consider are Lending Club and Swift Capital.

Lending Club offers loans up to $300,000 for 1 to 5 years. And you’re not required to offer collateral for loans under $100,000. Loan interest is fixed and starts at 8% APR. Origination fees are 1% to 6%. To qualify you must be in business for at least 2 years and have $75,000 in annual sales.

LendingClub

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Swift Capital gives funding up to $300,000 and you can receive up to $10,000 within an hour of approval. Terms are available from 3 to 12 months. Rates start at 9.99%. The origination fee is 2.5%. To qualify you must be in business for at least 1 year, have monthly revenue of over $5,000 and a credit score of at least 550.

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Who Will Benefit the Most From a Funding Circle Small Business Loan?

Small business owners can benefit from both Lending Club and Funding Circle because they have similar terms. Funding Circle does allows you to borrow more money than Lending Club, so it’s your best option if you need to borrow more than $300,000.

However, Lending Club does offer $100,000 unsecured. You shouldn’t be completely deterred by Funding Circle because it requires asset collateral, just make sure you understand the implications if your loan should go into default.

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Featured, Reviews

The Ultimate LearnVest Premium Review — Online Financial Planning for $299 Upfront, $19/Month

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The editorial content on this page is not provided by any financial institution and has not been reviewed, approved or otherwise endorsed by any of these entities.

The Ultimate LearnVest Premium Review

If you’re young, or simply don’t have an extra $1,100 to $5,600 a year on average lying around waiting to pay a financial planner, it can be difficult to know where to turn for financial guidance. Fortunately, several online financial planning companies have made financial planning more affordable. LearnVest is one of many such companies that have cropped up in recent years to provide the service at a lower cost.

What Is LearnVest?

LearnVest is an online financial planning company that was founded in 2009 with a mission to give young professionals access to affordable financial planning services. The platform combines budgeting tools with resources for financial information and the opportunity to gain access to an online financial planner if you upgrade your package. The startup went on to raise $75 million in venture capital until it was finally acquired in 2015 by Northwestern Mutual. The merger allowed LearnVest to develop and expand its offerings. Since its founding, the platform has developed into a more affordable way for members of either gender to gain access to a financial planner and to create and manage a personal financial plan.

How It Works

LearnVest offers both a paid and unpaid version of its services. The free version gives you access to the company’s online budgeting tool and dashboard to help you manage your budget, similar to popular budgeting platforms like Mint and YNAB.

You can also peruse LearnVest’s Knowledge Center, where you’ll find a wealth of articles and videos with information about several financial topics.

If you are looking for personalized financial advice from an expert, you’ll need to sign up for the paid version, called LearnVest Premium. For an initial payment of $299 plus $19/month, the premium service comes with access to a personal financial planner in addition to the online dashboard features.

MagnifyMoney tapped staff writer Brittney Laryea to test out LearnVest’s financial planning service, LearnVest Premium, and review it here. Find out more about LearnVest and Brittney’s review below.

The LearnVest Premium Review

As a 22-year-old recent college graduate, I am in that important stage in life. I reviewed LearnVest from the perspective of someone who has never gotten professional financial advice before and is looking to get her financial life in order as she starts her career. My experience will certainly be different from, say, a single mother or an elderly couple facing retirement. But I tried to demonstrate how each element of the LearnVest experience works so anyone reading will get a sense of what they offer.

The LearnVest Premium Review

The Fees

For $299 up front, you’ll get access to a personal financial planner who will set up a time to speak with you on two separate occasions and work with you to create a personal financial plan. You can split the $299 payment into two payments of $149 or three payments of $99. After the two initial phone calls, you’ll pay LearnVest $19 each month for “ongoing support” from your planner via email.

At $299, LearnVest is certainly delivering when it promises to offer affordable financial planning services. The average financial planner charges an initial fee of $500 to $2,000 and then about $50 to $300 monthly for ongoing service.

$19 per month for ongoing financial planning is only a little more than Spotify premium customers pay for monthly subscriptions.

So far so good. But what are you really getting for that money?

Creating My “Smart Profile”

The first thing you’re prompted to do when you sign up for LearnVest Premium is to fill out your financial profile, which is called your “Smart Profile.”

Creating My “Smart Profile”

You’ll enter basic financial information for your planner such as your annual income, goals, and current budget if you have one. This is also when you would link all of your accounts — checking, savings, credit card, retirement, student loans, etc. — to your profile if you haven’t already done so. In addition to prepping your information for your planner, filling out the financial profile helps put your current finances in perspective in relation to your financial goals. This part was intuitive and took less than 15 minutes for me complete.

After that, I was eager to schedule my call with my planner, which I was prompted to do after filling out the Smart Profile.

The First Call: Strategy Session

The goal of the first call is to lay the foundation for what will become your complete financial action plan with your planner. But you won’t receive the actual plan until your second call. During the first call the planner gets an idea of your financial situation. Your final plan takes all of the details that you discuss with your planner in this first conversation and shows the smaller steps you’ll need to follow to reach your financial goals. For me, those were things like paying off my student loans and saving up for retirement, but for others it could be things like saving up to buy a new home or for your kid’s college education.

The First Call: Strategy Session

During the call, you’ll speak with your planner over the phone, while you both look at the plan-to-be in your LearnVest dashboard. The first thing my planner did was verify all of the information that I entered into my Smart Profile. He then asked if there were any other accounts or information that I needed to add or clarify. Your planner may also ask about your current insurance policies and important financial documents such as a regular or living will or power of attorney.

At the end of the call, you should have a general idea of the plan-to-be, and your planner may assign some follow-up homework for you to complete before your next call (ideally, about a week later) such as sending additional information that will help them create your action plan. Your planner may also assign you a challenge — which you can see when you log in to your dashboard. The challenge may be to practice a budget for the week or to create a bank account.

My experience:

My first call was enjoyable, and we spoke for about an hour. My planner was patient as I clarified and adjusted information I entered into my Smart Profile.

After we sorted out my personal accounts and debts, my planner asked about my short- and long-term financial goals such as saving for an emergency fund or for travel. I’d given some thought to retirement before. I actually already started contributing to a 401(k) through my employer. I think of travel as more of a luxury, and definitely not a necessity. If I had extra money and the ability to travel, then I would, but everything else comes first. This would be the first time I’d specifically set aside funds to travel in the future. Keeping my savings goals in mind helped to inform the budget he would create for me. The planner made sure to factor in the monthly $19 for LearnVest’s ongoing support into my overall expenses.

Then he calculated a tentative weekly spending budget based on my outlined plan. The weekly spending number was the amount I could spend each week and still accomplish all of my monthly goals. It’s determined by splitting up what was left of my flexible spending over the number of weeks left in the month.

One aspect I appreciated was that my planner gave me three different budgets with varying levels of spending flexibility. I chose the budget that gave me the tightest weekly spending allowance, meaning more of my money was going toward my goals each month.

budget strategy

He also gave me a few financial tips during the first call. I’ve listed a few below, although there were many more.

  • Freezing (in a bag of water, in my freezer) or hiding my credit card to trick myself into not using it to help with paying down the balance.
  • Opening high-yield checking and savings accounts with an online bank. My planner recommended Ally Bank, where I could earn 1% on my savings, versus the 0.01% I earned at Wells Fargo. Luckily, I was already in the middle of switching to Ally from Wells Fargo. His encouragement gave me the extra boost I needed to get it done.
  • Setting up two checking accounts — one as a regular checking account but without a physical debit card linked to it, the other a “spending” account that was linked to my debit card. Then I was to set up an automatic weekly transfer of my weekly budget into the spending account to use. This way, it would be impossible to go over my budget without deliberately transferring funds over to my spending account.
  • Think about insurance options. He also explained to me the importance of having different types of insurance plans that many don’t get through an employer such as renters insurance or life and disability insurance. The explanation was helpful, and easy enough to understand. But I have to admit, I didn’t follow the advice. I hadn’t yet considered paying for what I see as “extras” like renters insurance or life and disability insurance. I rent, but I don’t own anything of substantial value so, for me, renters insurance is a waste. I figure I’ll just get it when I have something more valuable than my rice cooker to protect. One of my parents pays for a small life insurance policy that I’ve had since high school, and I’m young so here’s hoping I don’t suddenly become disabled while I look into it. I’ll likely start paying for disability insurance in February 2017.

After we covered those details, we scheduled a follow-up call, which would take place about a month later.

The Homework

After our talk, my planner sent me a follow-up email with my homework for the week. I had two assignments: to open new checking and savings accounts and to double-check my existing insurance policies and coverage amounts.

He also assigned me a “challenge,” which are little tasks your adviser sets up for you on the LearnVest website. You can see your challenges when you are logged in to your LearnVest dashboard, and you’ll get email reminders when the deadline for the challenges are close. You can check off your challenges as you complete them, or mark them as missed. Be honest; your adviser will ask you about them in the follow-up call.

action program

My first challenge was to practice the weekly spending budget he created for me during the initial call. The added challenge was to use cash only (so that I could physically see what I would be spending). Having the challenge helped me to keep my budget in mind; however, I didn’t complete it. My 22nd birthday was that week, and I take my birthday celebrations pretty seriously.

Since my weekly budget was determined by splitting up what was left of my flexible spending over the remaining weeks of the month, I just subtracted what I used up on my birthday celebrations and determined a new weekly budget for the rest of the month.

The Second Call: Getting My Action Plan

This is the call that solidifies your financial action plan. During the second call, your planner will explain to you all of the ins and outs of following the plan they have created for you to follow based on information from the first call.

The second call will be about a week or two later, depending on your scheduling availability and that of your planner. I scheduled my follow-up call at the end of our previous conversation for two weeks later, but I had to reschedule via email because I had other obligations come up. Rescheduling was painless and completed in less than 24 hours. My planner responded to my initial email with the times he would have available coming up, I emailed back with the time that worked for me best, and I was booked.

My experience:

Because I had to reschedule our initial follow-up call, our second call was about a month later. By then, I was used to my new weekly budget and felt good and ready to begin my new action plan. Before we got to my actual action plan, my planner checked in with me to see how I did with my suggested weekly budget.

He even gave me the option to switch to one of the other versions he created with a little more flexible spending, but a longer road to my savings goals. I struggled a bit with my birthday spending and a few emergencies, but I knew those were outliers and I could easily stick to the weekly allotment in a regular week.

I chose to stick with my budget. He also asked me if anything about my financial situation had changed since we’d last spoken. One thing did change: I planned to move into a cheaper apartment the following month. My planner made a note to adjust my action plan accordingly and said the final plan would include the update. Afterward, he talked me through how to implement the action plan he created for me.

Toward the end of our conversation, he explained important financial documents I should have at any age such as a living will and where I could look for resources to complete them in my dashboard. In the dashboard, under the “Program” tab is a section called “Planner Picks” that has the company’s approved recommended resources.

Action Plan and a $2.5 Million Surprise

My planner delivered my action plan to me via my LearnVest dashboard. It was a PDF file of about 20 pages that I could download to my computer if I wanted. It was super simple to understand and split into three parts:

  1. A recap of my current financial situation
  2. My financial goals
  3. The action steps that would help me to reach my goals over time

The Recap

The recap restated my weekly spending number (that’s the amount I was allowed to spend each week) and still accomplish all of my monthly goals.

The Goals Summary

The goals part broke down each of my stated savings and debt goals and showed how I would go about reaching them over five years.

The Goals Summary

The goals changed over time to reflect when smaller goals like my emergency fund and credit card payoff would be complete. Of course, this part also included my retirement needs.

I was shocked at his calculation: I would need to save more than $2.5 million to maintain my current income in retirement. To get there, I would need to continue contributing 10% towards my 401(k) and bump that contribution up by 2% every year or any time I get a raise. The idea here is that I would save more as I earned more over time. Sounds doable enough. Finally, it listed what estate documents I needed, such as a living will and beneficiary forms. To be honest, I haven’t completed my living will yet. You can upload these documents to your dashboard once they are completed.

The Action Steps

The final part outlined the action steps that I would take monthly to reach my goals. It briefly reviewed my monthly budget and showed how I should set up my accounts so that each month of successful budgeting would contribute to my overall goals.

I had a few more challenges assigned to me, such as learning to categorize my purchases and create goals in the dashboard. My planner sent a follow-up email after both calls recapping what we discussed. Moving forward, I would have ongoing support from him via email and had a copy of my plan available to me in my LearnVest dashboard.

For now, I’m following the plan as best as I can. The first month was rough with moving expenses and holiday expenses, but I’m confident I’ll be able to beat my weekly spending target and pay down my debts even faster when life settles down a bit.

What Is Meant by “Ongoing Support”?

Ongoing support from LearnVest means that you can reach out to your planner for help or advice via email, anytime. Your planner will also continue setting up challenges for you in your dashboard and may, on occasion or when you email them, ask you about your progress.

I follow up with the challenges when they are assigned to me, but I’ve only had to contact my planner once via email to clarify my insurance needs. Other than those little questions, I don’t have much of a reason to contact the planner since my entire plan is on my dashboard, and I have a feeling I’ll be following the same plan for a while.

Pros and Cons

Pro: Quick Responses

Having email access to your planner actually works out pretty well. I was impressed when I emailed my planner late in the day with a question and he got back to me via email in less than 24 hours.

Pro: Online and Mobile

LearnVest is accessible to you on the computer and in an app for your mobile device. Having both platforms makes it easy and convenient to check your progress toward your goals or edit your budget whenever or wherever.

Pro: Challenges

Each time your planner sets up a new challenge for you, you’ll get an email. They will be challenges such as watching an educational video, practicing a shopping fast for a month, or automating contributions to one of your savings accounts. The challenges help in a couple of ways. They are a reminder to log in to your dashboard if you aren’t prone to doing so on your own. The challenges also serve as a way for your planner to contact you and keep you motivated with creative short-term financial goals.

Con: No Face Time

Both meetings with your financial planner will take place over the phone. You can’t video chat or otherwise see the person to whom you are giving your financial information face to face, which may make some feel cautious or uncomfortable. Your planner may do as mine did and exchange some polite banter or offer to answer any questions you may have about LearnVest or the process to help you feel more comfortable.

Con: No Credit Score Information

You’ll need to download a separate app it you want to monitor your credit score. Unlike other popular budgeting apps, such as Mint, you won’t be able to see any information related to credit score or credit report information with LearnVest.

Con: Can’t Split Transactions on Mobile

The LearnVest mobile app’s budgeting software doesn’t allow you split up one transaction into multiple categories. So if you spent money on both clothes and food in one location, you’ll have to log in at a desktop computer to split the transaction.

Con: No Investment Management

Unlike the robo-advisers out there and some other financial planning platforms, LearnVest doesn’t manage your investments. You can check out this article for a few robo-advisers if investment management interests you.

Other Financial Planning Platforms to Consider

There are a host of other robo-advisers and online financial planning tools that target millennials cropping up to choose from that you may prefer over LearnVest.

Stash Wealth

A newer online financial planning platform, Stash Wealth, operates very similarly to LearnVest, but is aimed at what it calls H.E.N.R.Ys (High Earners Not Rich Yet). It costs $997 to get started, then $50/month to continue the service. Stash Wealth does do more of the work for you — like setting up automation for your savings and checking your tax information — so you don’t pay any taxes that you don’t have to pay. Once you’re ready, they start investing your money for you in accordance with your goals.

XY Planning Network

The XY Planning Network is a network of fee-only financial advisers who focus specifically on Gen X and Gen Y clients. There are no minimums required to get started as a client, and advisers in the XY Planning Network are not permitted to accept commissions, referral fees, or kickbacks. In other words, no high-pressure sales pitches or hidden agendas. Just practical financial advice doled out at a flat monthly rate. The organization is location independent, offering virtual services that enable any client to connect with any adviser regardless of where they reside.

Garrett Planning Network

A national network featuring hundreds of financial planners, the Garrett Planning Network checks many key boxes for millennials. All members of the Garrett Planning Network charge for their services by the hour on a fee-only basis. They do not accept commissions, and clients pay only for the time spent working with their adviser. Just as important for millennials, advisers in the Garrett Planning Network require no income or investment account minimums for their hourly services.

Mvelopes

Mvelopes is an app that provides a spinoff of the cash envelope budgeting system popularized by Dave Ramsey. Like LearnVest, its basic version is free and allows you to link up to four bank accounts or credit cards. Mvelopes has a second tier called Mvelopes Premier. It costs $95 a year, and you can link an unlimited number of bank accounts and credit cards, among other features. Mvelopes’ top tier, Money4Life Coaching, adds one-on-one coaching tailored to your financial needs as LearnVest Premier does. However, there is no price for this tier specified on the website.

The Final Verdict

LearnVest Premium is a convenient and cheap alternative to an in-person financial adviser if you need a little additional help planning your finances or a convenient reminder to stick to your budget, but it’s not worth the $299 + $19 a month if you just want to keep an eye on your spending. For the latter, stick to the apps that do it better, like Mint and YNAB.

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Building Credit, Reviews

BankAmericard Secured Card Review: $39 Annual Fee, 20.74% Variable APR

Advertiser Disclosure

The editorial content on this page is not provided by any financial institution and has not been reviewed, approved or otherwise endorsed by any of these entities.

Building credit when you’re starting from zero can be difficult. One way to build credit is by opening up a secured card. Secured cards are an introduction into the world of credit. You deposit a certain amount of money to establish your credit limit. Then, you pay off your balance in full every month to establish a good credit history and avoid late fees.

If you prove you can use a secured card responsibly, you will likely be offered a traditional credit card.

Today we’ll review Bank of America’s secured credit card. Bank of America is not the only financial institution that offers secured credit cards. In fact, you may find better terms elsewhere. Check out our full review for more details:

BankAmericard Secured Credit Card Details

Minimum deposit

To open a BankAmericard Secured Credit Card, you have to make a minimum deposit of $300. The maximum you can deposit is $4,900. BankAmericard Secured Credit Card users do not earn interest on their deposits. For this reason, it may make sense to make a smaller deposit to open your secured card and store any extra funds you have in a savings account where you can earn interest.

Determining your credit limit

Your credit limit is determined by your security deposit, your income, and your ability to repay. Some users will only be able to spend as much as they originally deposited to open the card. However, if you prove that you have the income to repay, you may have a larger line of credit extended to you, making the card only partially secured. For example, if you deposit $300, but Bank of America looks at your income and decides you’re able to pay $700 back, your line of credit would exceed your deposit by $400.

Building your credit

Once you’ve had the card for 12 months, Bank of America will re-evaluate your credit history and ability to repay. If both of these things are trending to the positive, they may return your deposit, making the card fully unsecured. This is an ideal situation for those trying to establish or rebuild their credit.

Because Bank of America does report their secured card customers to each of the three credit bureaus monthly, you are likely to see an uptick in your score if you’re using the card responsibly. This increases the likelihood that you’ll get your deposit back at the end of the 12-month period.

Interest rates and fees

The BankAmericard Secured Credit Card is not without fees. In fact, its fees are probably the least attractive thing about it:

(Terms are current as of Jan. 3, 2017)

  • $39 annual fee
  • 20.74% variable APR on transactions, balance transfers, direct deposit, and check cash advances
  • Up to 29.99% variable APR penalty if you miss a single payment
  • Fee of $10 or 3% — whichever is more — on all balance transfers and direct deposit or check cash advances
  • 25.49% variable APR on bank cash advances
  • Fee of $10 or 5% — whichever is more — on all ATM, over-the-counter, same-day online, or cash-equivalent cash advances
  • 3% foreign transaction fee
  • Maximum late payment penalty fee of $37
  • Maximum returned payment penalty fee of $27

In addition to these fees, you have an option to set up overdraft protection with your secured card if you have a Bank of America checking account. If the card is used for overdraft protection, you will be charged a $12 fee each time. While this is better than the typical $35 overdraft fee, it’s still not ideal. Many financial institutions offer free overdraft protection when you are linked to a savings account; however, Bank of America charges $12 every time, whether you’re linked to your savings account or your secured card.

Safety and benefits of the BankAmericard Secured Card:

The BankAmericard Secured Credit Card does come with some security benefits. For one, you have $0 liability protection. This means that if anyone uses your card fraudulently, you won’t have to pay a dime as long as you report it and provide any requested information to Bank of America.

It also comes with chip technology and ShopSafe. ShopSafe is a program that generates a temporary card number for use when shopping online. It links directly to your card, but protects you from having your real card number stolen.

Another benefit is signing up for email and text alerts. These can either provide you with the information you want at the drop of a hat or remind you when your bill is due so you don’t rack up those nasty interest charges and late fees.

What You Need to Get Approved for a BankAmericard Secured Card

To determine approval, Bank of America looks at several factors, including:

  • Your ability to pay the security deposit
  • Your ability to make monthly payments
  • Information pulled from all three credit bureaus
  • Past management of other Bank of America accounts for current members

Pros and Cons of the BankAmericard Secured Card:

Pros

  • Option for partially secured card for those with adequate income
  • Status regularly reported to all three credit bureaus to help you build or rebuild your credit
  • Potential to turn into an unsecured card after twelve months if used responsibly, removing the need for the hard credit pull that would be involved in opening a new card

Cons

  • Annual fee of $39
  • Interest rates are high — once you qualify for an unsecured card, it may be worth the hard pull and shopping around for lower rates
  • Associated overdraft protection is not free
  • Deposit does not earn interest

How the BankAmericard Secured Card Stacks Up to the Competition

Bank of America is not the only financial institution that offers secured credit cards. In fact, you may find better terms elsewhere.

USAA’s secured credit card does offer interest on your deposit through a 2-year CD. Interest rates are variable, but currently sit at 0.54% APY. The minimum deposit is $250, and the maximum is $5,000.

Interest rates charged to customers and associated fees are lower. There is a $35 annual fee, but no penalty APR or foreign transaction fees. Interest rates are between 10.15% and 20.15% APR, depending on your creditworthiness. All cash advances and balance transfers come with a 3% fee, and the fee for a late charge is $35. The only place where this card is more expensive than the Bank of America option is returned payment fees, which come in at $35. Both fees are only $25 for the first occurrence, however.

Another option is the Discover it Secured Credit Card, with a minimum deposit of $200 and a maximum of $2,500. This card earns you cash back rewards points on all your purchases as you build your credit. Depending on how much you spend, you could yield more in cash back rewards than the CD with USAA would yield you. It comes with no annual fee, penalty APR, or foreign transaction fee. They also won’t charge you a late fee the first time you miss a payment. After that, you pay $37.

While it lacks many fees, interest rates are actually higher than the Bank of America option at 23.24% APR on purchases and balance transfers. Balance transfers also incur a 3% fee. (Currently, there is an offer for 10.99% APR on balance transfers for the first six months.) APR for cash advances is 25.24%. The fee for cash advances is either $10 or 5% — whichever is more.

Don’t Focus on Rewards

Maybe the fact that the BankAmericard Secured Credit Card doesn’t offer you cash back is actually a positive. It won’t reward you for spending more money, and that’s a very good thing from a psychological perspective — especially if you are recovering from past credit follies.

We still like USAA’s interest-bearing CD option as it doesn’t incentivize additional spending, but does offer consumers a return on their deposit.

Your exclusive goal when using a secured card should be to rebuild your credit by using it and paying it off in full every month so you don’t incur interest or late charges. If rewards would entice you to do otherwise, sticking with Bank of America could be a smart move.

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Reviews, Student Loan ReFi

4 Best Parent PLUS Loan Refinance Options

Advertiser Disclosure

The editorial content on this page is not provided by any financial institution and has not been reviewed, approved or otherwise endorsed by any of these entities.

mortar board cash

Updated December 22, 2016

Are you a parent who is still repaying student loans taken out to help your children finance their education? While rising student loan debt totals are concerning for graduates, Parent PLUS loans can be troubling for those in their 40s and 50s trying to plan for retirement.

If you’re in this situation, you should consider refinancing your PLUS loans to lower your interest rate and make the loan more affordable. Direct PLUS loans have had interest rates ranging from 6 – 8% over the last few years, and many refinance programs have rates as low as 2% – 4%. Refinancing can save you hundreds of dollars per month.

Below are the best Parent PLUS refinance programs currently available. We encourage you to check each one out to see which suit your needs the most. You should shop around with each lender with whom you think you can qualify. All credit inquiries made within a 30-day period count as one inquiry in the eyes of the credit bureaus.

A Word of Warning on Refinancing

Thankfully, most student loan refinance programs and Parent PLUS refinance programs don’t have fees associated with the loan, so you don’t need to worry about paying origination or application fees. However, you should do the math to make sure refinancing is worth the paperwork.

If you extend your repayment term, you’ll have a lower monthly payment, but you’ll pay more over the life of the loan due to the amount of interest that will accrue. Additionally, if you’re trying to retire sooner rather than later, extending your term might not be in your best interest.

Ideally, you should find a lender willing to refinance your loan on similar terms with a lower interest rate. If your current loan balance is $10,000 and you have an 8% APR with 5 years remaining, and you refinance to a 5.99% APR with 5 years, you’ll save $568.95 on interest.

Beyond interest rates, you should also be aware that refinancing your Federal Direct PLUS loan means giving up several benefits specific to Federal student loans. Private lenders don’t offer the same repayment assistance, though some lenders are more flexible than others.

For example, you’ll no longer have access to different repayment plans, such as the Graduated, Extended Repayment Plan or Income-Contingent Repayment. Your loans won’t be eligible for forgiveness under the various Federal student loan forgiveness programs. You’ll also lose out on the benefit of forbearance and deferment, which temporarily allows you to pause payments in the event you experience financial hardship.

If you haven’t been struggling with paying back your PLUS loans, then losing these benefits might not concern you, but it’s a factor you should consider. Otherwise, if you experience difficulty making payments, you should reach out to your lender to see if any other payment arrangements can be made.

SoFi Parent PLUS Refinance Program

SoFi is one of the leaders in the student loan refinance industry, and it offers refinancing specifically for Parent PLUS loans.

  • You can refinance a minimum of $5,000 up to the cost of attendance
  • Fixed APRs range from 3.38% – 6.74%
  • Variable APRs range from 2.35% – 6.02% with autopay
  • No application or origination fees, and no prepayment penalties
  • Soft credit inquiry with pre-approval; hard inquiry once you accept the loan
  • Should have good credit, but it also takes your employment and credit history into account

 

SoFi Parent PLUS Refinance Programe45ewr

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Citizens Bank Refinance Program

Citizens Bank doesn’t offer a separate Parent PLUS loan refinance program like SoFi does, but you can refinance any student loan under its Education Refinance Loan.

  • There’s a minimum of $10,000 with a maximum up to $170,000 depending on the type of degree your child received
  • Fixed rates: 5.95% APR to 6.55% APR (with autopay)
  • 5, 10, 15, and 20 year terms available
  • No origination, application, or disbursement fees and no prepayment penalty
  • Hard credit inquiry
  • You need a minimum annual salary of $24,000
  • You can apply with a cosigner

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DRB Parent PLUS Refinance Program

DRB also offers a Parent PLUS refinance program with low interest rates.

  • A minimum of $5,000 is required to refinance and there’s no maximum amount
  • Variable rates: 3.64% – 6.29% (with autopay)
  • Fixed rates: 4.20% – 7.20% (with autopay)
  • Terms of 5, 10, 15, and 20 years are available, though you can request a specific term under 20 years
  • Also offers a hybrid loan (mix of fixed and variable rates), but you must inquire about it
  • Child needs to have graduated college and be professionally employed
  • No origination fee or prepayment penalty
  • Available in all 50 states
  • Hard credit inquiry used

DRB Parent PLUS Refinance Program

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CommonBond Parent PLUS Refinance Program

CommonBond is dedicated to making the refinance process as simple as possible for students, and has recently introduced a refinance program specifically for Parent PLUS loans.

  • The maximum amount you can refinance is $110,000
  • Fixed APRs range from 3.37% to 7.74%
  • Variable APRs from 2.32% to 6.18%
  • Hybrid APRs (5 years at fixed, then 5 years at variable) are offered
  • No application or origination fees, and no prepayment penalties
  • 5, 10, 15, and 20 year terms available (hybrid loans offered on a 10 year term)
  • Temporary loan forbearance is available if certain requirements are met
  • Soft credit inquiry first, then hard credit inquiry if you accept the loan then hard credit inquiry if you accept the loan

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Keep in mind some lenders, such as SoFi, CommonBond, and DRB, offer the option to transfer your PLUS loans to your child. The Direct PLUS loan doesn’t offer this choice. It’s a great option to have if your child can handle making the payments.

There are many Parent PLUS loan refinance programs being created in wake of the success private lenders have had with refinancing regular student loans. Keep an eye out for them in case you’re not eligible for these. You can also check with your local credit union to see if they have any options available, but be sure the math works out in your favor, as some aren’t offering the best rates. Don’t forget – it’s worth shopping around for the most savings!

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Best of, Reviews

10 Best NO FEE Rewards Credit Cards of 2017

Advertiser Disclosure

The editorial content on this page is not provided by any financial institution and has not been reviewed, approved or otherwise endorsed by any of these entities.

There are an abundance of no fee rewards credit cards available, so how do you best determine which one to keep in your wallet? Most earn a measly 1% on your spending, while others have no rewards at all. To help, we’ve dug deep into our database of thousands of rewards cards to find the very best no annual fee rewards credit cards of 2016 for each category.

While you might find rewards credit cards with an annual fee can give you the best rewards, we’re sticking to no fee cards that are available even if you don’t have truly excellent credit (good credit should be fine for most of these).

The first cards we list here offer unlimited double rewards on everything you purchase, while the remaining offer 3% or better rewards on spending in popular categories so you can mix and match to maximize your rewards, or they offer the chance for better earning if you use your rewards for travel.

1. Double Rewards on Everything, NO FEE – Citi Double Cash

721_card.Citi_doubleCiti offers you rewards twice. First, you get 1% cash back when you make a purchase. Then, you get another 1% cash back as you pay it off. All with no annual fee and no spending cap. If you pay off in full each month, you’ll get both rewards at the same time. That lets you earn rewards twice as good as standard reward cards.

If you like to maximize things and want to earn more rewards in special spending categories, consider pairing this with one of the no fee cards we list below.

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2. Honorable Mention: 2% Fidelity Rewards Visa Signature, NO FEE

fidelityrewardsvisaFidelity provides no annual fee 2% cash rewards on purchases if you deposit the cash you earn into a Fidelity account. But you don’t need to have any stocks or investments to have an account. Fidelity has no fee cash accounts where you can deposit your rewards, then withdrawal when you’re ready to spend. Be aware this card is designed for people with Excellent credit, while the Citi Double Cash might be easier to get.

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Both cards offer you the flexibility to earn double rewards on anything you purchase; so either one of these is a nice addition to a rewards strategy. The advantage of the Fidelity card over the Citi Double Cash is that its foreign transaction fees are just 1% versus 3% for the Double Cash. But setting up the Fidelity card and rewards is more cumbersome than the dead simple Citi Double Cash.

If you want to earn more than 2% rewards here’s a rundown of the best no fee rewards credit cards that earn 3% or more in the most popular categories. You can click on each category for our take and details:

And if you’re interested in traveling, here are the best no fee rewards credit card deals:

If you like to dig, we also have a complete (and long) list of cards that earn more than 3% on purchases in many more special categories, including cards with an annual fee.

3. Restaurant Spending: Chase AARP Visa – 3% Rewards, NO FEE

1167_cardAARPBychaseAlthough AARP is known for serving Baby Boomers, foodies of any age can sign up for this card – AARP membership not required. You get 3% cash rewards at restaurants as well as gas stations. You also earn 1% rewards on all other purchases.

The information related to AARP Visa credit card has been collected by MagnifyMoney and has not been reviewed or provided by the issuer of this card.

Learn more at AARP.org

4. Travel Spending: AAA Member Rewards Visa – 3% Rewards, NO FEE

340_card.340_card.AAA_Member_Rewards_Visa_Signature_CardNo need to be an AAA member to take advantage of this rewards card. You earn cash back when you shop at travel merchants including airlines, car rental agencies, hotels, cruise lines and travel agencies. Along with the 3% cash rewards for travel, you earn 2% cash rewards on gas, grocery and drugstore purchases. On everything else you get 1% rewards.

 

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5. Gas Spending: Fort Knox Credit Union Visa Platinum – 5% Rewards

fort-knox-visa-platinumSpend a lot of cash at the pump? The Fort Knox Credit Union Visa Platinum offers 5% cash back for gas. On all other retail purchases, you get 1% cash back. Anyone can join the Fort Knox Credit Union by becoming a member of the American Consumer Council for $5.

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6. Grocery Spending: Blue Cash Everyday from American Express – 3% Rewards

381_card.205_card.blue_Cash_Everyday_Card_from_American_ExpressThe Blue Cash Everyday from American Express offers 3% cash rewards on grocery store purchases up to $6,000 per year. You also get 2% rewards at gas stations and select department stores. On everything else you earn 1% rewards.

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7. Honorable Mention: Golden 1 Credit Union Platinum Rewards – Unlimited 3% Grocery Rewards

If you live in California, the Golden 1 Credit Union Platinum Rewards card will give ygolden1ou 3% cash rewards for purchases on groceries without the caps on the Blue Cash Everyday, along with gas and restaurants and 1% rewards on all other purchases. Also in California, the JCB Marukai Premium card offers unlimited 3% cash rewards on all purchases after your first $3,000 in spending each year. The catch is there’s a $15 annual fee on the card.

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5% Cash Rewards in Rotating Categories: NO FEE

Cards with a rotating reward program can give you 5% cash rewards with no annual fee, but you’re limited to spending in special categories each quarter and there’s a cap on how much spending earns the 5%. You also have to opt into the 5% cash back rewards program each quarter.

8. Chase Freedom – 5% in rotating categories, $0 ANNUAL FEE

Earn 5% cash back on up to $1,500 in combined purchases in bonus categories each quarter you activate. Enjoy new 5% categories every 3 months. Unlimited 1% cash back on all other purchases.

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9. Discover it® – 18 Month Balance Transfer Offer – 5% in rotating categories, NO FEE

Discover itWith Discover, you earn 5% cash back in categories that change each quarter up to the quarterly maximum (up to $1,500 of combined purchases) when you sign up. You also earn 1% cash back on all other purchases. You can redeem your cash back for any amount at any time. And your cash back never expires. Discover will match all the cash back you’ve earned at the end of your first year on the credit card – only for new cardmembers.

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10. Platinum Cash Rewards Visa from the Nusenda Credit Union – 5% in rotating categories, NO FEE

nusenda_logo5% cash rewards on groceries, gas expenses, movies, restaurants, home improvement, education and travel. This quarter, cardholders will earn cash back on restaurants, hotels and airfare purchases. There’s a cash back cap of $1,500 per quarter. Anyone can join the Nusenda Credit Union by donating $10 to the New Mexico Wilderness Alliance; contact a customer representative for details. The advantage of this card is that its categories tend to be more broad, and not store-specific like those on the Chase Freedom and Discover It, so it’s a great way to get you closer to 5% rewards on everything you spend.

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If you’re going to go through the effort of enrolling in a rewards program, consider all three cards to see which categories will benefit you the most. But, if you’re looking for freedom to spend without restrictions, sticking with the Citi Double Cash card may be your best simple bet.

Honorable mentions for travelers

No foreign transaction fees with plain cash back: Quicksilver from Capital One – 1.5% Rewards

Capital One's QuicksilverCapital One’s Quicksilver gives you 1.5% cash back on all purchases. And like all Capital One credit cards, there are no foreign transaction fees. Even though you earn less rewards than the Citi Double Cash or Fidelity American Express, this card is a better option for your international spending, since you avoid fees of 1 to 3%.

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Real airline miles: Amex EveryDay Card

The Amex Everyday Card is a no annual fee rewards credit card that earns Amex Membership Rewards points, which you can turn into real amexeverydayairline miles with several airlines, including Delta SkyMiles, Virgin Atlantic Flying Club, JetBlue True Blue, and Virgin America Elevate. It’s the only no annual fee card you can apply for online that can net you real Delta SkyMiles. When you want to convert points to Delta miles, just go to the Amex site, and transfer your points to Delta or the other participating airline programs any time.

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Points for travel on any airline: Bank of America Travel Rewards

bankofamericatravelrewardsThe Bank of America Travel Rewards card earns a base 1.5x points per dollar you spend, and you can use the points to erase travel purchases from your statement. Every 10,000 points is worth $100 when you use them for travel, so each point is worth one cent. Where the card gets interesting is if you’re a Bank of America customer with a checking, savings, or IRA account. If you are, you’ll get a 10% bonus on what you earn each year, so the card effectively earns you 1.65x points per dollar. Even better, if you’re a Platinum level member of Bank of America Preferred Rewards (which you get by keeping a lot of your money with them), you can earn up to 2.625x points per dollar, which is an incredible deal. There are also no foreign transaction fees to worry about.

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How can you get the most value from a rewards credit card?

In order to best benefit from no annual fee rewards credit cards, follow these tips:

  • Narrow your focus: Before choosing a no annual fee rewards credit card (or cards), take a look at your budget and several months’ worth of bank statements. Then, pick cards that’ll offer you the most cash back for things you already buy. You shouldn’t change your spending habits to match a rewards program.
  • Give your rewards cards a job: Don’t spread out your spending onto too many cards without a purpose or you risk making less cash back overall. Choose a few cards and assign them a job so you know what purchases to make on each one to maximize your cash back.
  • Don’t get overzealous: Rewards shouldn’t justify overspending, especially if you’re struggling with debt. It’s a reward for making legitimate purchases. After all, you won’t make enough back to put a big dent in your monthly statement. For instance, $2,500 spent on the Fidelity American Express card equals a $50 deposit. It’s a great perk, but it shouldn’t be your sole reason for buying something.
  • Read the fine print: Understand the implications of each rewards program. For the rotating category cards, you get a huge amount of cash back, but you’ll have to strategize your spending each quarter to earn it. And you have to enroll into the program by the deadline to qualify. Set a reminder on your smartphone or calendar if necessary. You don’t want to miss out on a cash back category for an entire quarter.

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Reviews

Ally Bank Review: One of the Best Banks for Low-Fee Checking, High-Yield Savings

Advertiser Disclosure

The editorial content on this page is not provided by any financial institution and has not been reviewed, approved or otherwise endorsed by any of these entities.

Ally Bank Review

Ally Bank boasts some of the most competitive savings rates and lowest fee checking accounts on the market today.

The bank offers a variety of checking as well as savings products including high-interest savings accounts, money market accounts, and certificates of deposit (CDs). Recently, Ally broke into the credit card space with the introduction of the Ally CashBack Credit Card.

Ally’s Interest Checking Account

Ally’s interest checking account is very convenient if you’re comfortable with online banking. However, if you’re not used to online banking, you may be disappointed that you are unable to make cash deposits and cannot go to a physical location if you prefer in-person customer service.

Account Details

It’s easy to open an interest checking account with Ally. Currently, accounts with under $15,000 earn 0.10% annual percentage yield (APY), while accounts with a minimum balance of $15,000 earn 0.60% APY. Ally’s user-friendly app makes it easy to deposit checks on the go and transfer money. There are no physical bank locations. All banking is done digitally through the website or app.

Fees

One of the benefits of Ally’s interest checking is there are no monthly maintenance fees. There are no fees for an ACH transfer to a non-Ally bank, no fees for incoming wires, and unlimited free standard and cashier’s checks. If you overdraft, there is a $25 overdraft fee per item, but this fee is limited to once per day. This $25 overdraft fee can be avoided by using Ally’s overdraft transfer service. You connect your Ally savings account to your checking account to automatically transfer funds if you overdraw your checking account.

Customers can use any Allpoint ATM for free and get reimbursed up to $10 each month for fees associated with other ATMs.

Pros and Cons

Pro: Up to $10 reimbursement of ATM fees. If an Allpoint ATM is not convenient, you can use other ATMs and be reimbursed for any fees they might charge you, up to $10 each month.

Con: Unable to make cash deposits. Since Ally banking exists entirely online, there is no way to deposit cash into your account.

Pro: No minimum starting balance. You are not required to have any minimum amount of money to open an account.

Con: No physical locations. As is typical with online banks, there are no physical bank branches, which can be an adjustment for those more comfortable with traditional banking.

Pro: No monthly maintenance fee. There is no fee or requirement to maintain a certain amount of money in your account.

Con: While Ally does strive to provide excellent customer service, many customer reviews have complained about the bank’s poor communication. A slowness in clearing deposits and lack of notification of changes or closing of accounts have topped the list of complaints.

How Ally’s Checking Compares

The online checking experience Ally provides is not very different from other online banks. The biggest differences are apparent when comparing Ally to traditional brick-and-mortar banks.

Online Savings and Money Market Accounts

Ally’s online savings and money market accounts have competitive interest rates. However, like other savings and money market accounts, Ally limits the number of transactions you can make each month, and these accounts come with a hefty fee if you exceed the number of allowed transactions.

Account Details

With some of the highest interest rates available and no minimum balance, Ally online savings and money market accounts are attractive options. Currently, Ally’s online savings account offers a 1% APY while the money market account earns 0.85% APY across all balance tiers. The average savings account at other big banks earns somewhere between 0.1% and 0.12% depending on the account balance.

Although the interest rate on Ally’s money market account is slightly lower, it offers some benefits not available with their online savings accounts. The money market account includes a free debit card and checks, plus unlimited deposits and ATM withdrawals.

Fees

The only fee that differs from Ally’s checking is the excessive transaction fee. By law, these accounts are limited to six transactions per statement cycle. If you exceed this amount, you will be charged $10 per additional transaction. If you do this frequently, Ally will be required to close your account.

Pros and Cons

Pro: No minimum opening deposit. You can open an account with any amount of money.

Con: Limited transactions. You are only allowed six transactions per statement cycle and frequently exceeding this amount can result in the closing of your account.

Pro: Unlimited deposits. Deposits do not count toward your six transactions each month.

Con: No cash deposits. Again, the fact that Ally is an online bank means you will not be able to make cash deposits.

Pro: Debit card is available for money market accounts. Having a debit card makes it easier to access the money in your account, and ATM withdrawals do not count toward the transaction limit.

Ally’s CashBack Rewards Credit Card

Ally’s cash back rewards are average, but this credit card may be a good option if you want to simplify your finances by keeping all your banking in one place.

Read our full review of the Ally CashBack Credit Card here.
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Account Details


Ally’s CashBack Credit Card
is a logical next step if you are already banking with Ally. Ally currently offers a 10% bonus when you deposit cash back rewards into your Ally account. However, if you are not already banking at Ally, the card offers only average rewards.

Rewards Program

Ally’s CashBack Credit Card has no annual fee and has unlimited rewards, earning 2% cash back at gas stations and grocery stores and 1% cash back on all other purchases. They are also currently offering a $100 bonus when you spend $500 on eligible purchases during the first three months. The drawback is their 2% cash back is dependent on merchant codes that stores themselves determine.

Interest Rates and Fees

While there is no annual fee, there are balance transfer fees (the greater of $10 or 4% of each transfer), cash advance fees (the greater of $10 or 5% of each transfer), and foreign transaction fees of 3%. There is also a minimum interest charge of $1 for cards carrying a balance.

Your card’s interest rate will vary based on your creditworthiness and ranges between 13.24% and 23.24%.

How the Ally CashBack Card Compares

No limit on cash back earnings can be significant if you are putting all your regular spending on the card. Their 10% deposit earnings also really help to boost the rewards of this card. However, if you don’t already have an account or don’t want to open a new account with Ally, then you may want to look at other cash back rewards cards.

The Power of Linking Ally’s Checking and Savings Accounts

While Ally’s checking and savings accounts are strong on their own, having linked checking and savings accounts provides a number of added benefits. You can keep all of your money in your Ally savings account and have free, automated transfers from savings to checking to cover any potential overdrafts. This linking and the free transfer would prevent a potential $25 fee for each day that you overdraft.

Your ability to transfer funds between accounts and have immediate access to your money is another perk. This means you can easily withdraw money using your ATM card, making the savings account much more accessible.

How Ally’s Online Savings and Money Market Accounts Compare

With their high-interest rates and easy access, Ally’s online savings and money market accounts rank among the best savings accounts available. These accounts become even more attractive when linked with an Ally checking account. Having the accounts linked means you have access to overdraft protection and free transfers between accounts. This allows for immediate access to money in your online savings and money market accounts.

Ally’s IRA and Certificate of Deposit Options

While the early withdrawal fees are what you would expect with IRAs and CDs, Ally’s CDs stand out for their 10-day rate guarantee that ensures you are earning the highest rate regardless of which day you fund the account.

Account Details

Ally offers a variety of IRA and certificate of deposit (CD) products at various rates. Ally offers three different IRA options, including an IRA High Yield CD with APYs from 0.3% to 1.75% depending on the initial deposit amount and the term length. Ally also offers an IRA Raise Your Rate CD with 1.3% – 1.4% APY based on term length. However, the Raise Your Rate IRA also allows you to change your rate once (2-year term) or twice (4-year term) if Ally’s rate for your term and balance tier goes up. In addition, Ally offers an IRA online savings account with a 1% APY.

Ally’s CD offerings are very similar to their IRA options. There are three CD products, the High Yield CD, Raise Your Rate CD, and No Penalty CD. The APYs currently available for the High Yield CD and Raise Your Rate CD match those of their IRA counterparts, ranging from 0.3% to 1.75%. The No Penalty CD has an APY of 0.87%, which is less than the IRA online savings account, but there is withdrawal flexibility, which is not the case for IRAs.

Fees

Ally does penalize early withdrawals if you withdraw before the maturity date; the fee for early withdrawal depends on the term of the CD or IRA CD and ranges from 60 to 150 days’ loss of interest. Also, an early IRA withdrawal will be taxed by the Internal Revenue Service. There is no monthly maintenance fee, and the terms will automatically renew upon the maturity date with a 10-day grace period allowing you to withdraw your money at no charge.

Pros and Cons

Pro: Easy access banking app. The ability to see your CD balance and be notified of rate changes (so you can change your rate) provides great peace of mind.

Con: Automatic renewal. If you aren’t keeping track of your CD’s maturity date, you might find yourself unable to access your money for another few years.

Pro: Best rate guarantees. This is available for all CD and IRA products except for the IRA online savings account. Ally’s best rate guarantee ensures you receive their highest available interest rates when you fund your accounts within 10 days for a CD or 90 days for IRA CDs.

Con: Early withdrawal penalties. If you need access to your money within the next 1-5 years, the no-penalty CD may be your best option as all other products have a penalty fee for early withdrawal.

How Ally’s IRA and CD Products Compare

The rates are very competitive, but what puts Ally ahead is their CDs’ 10-day best rate guarantee, as well as the Raise Your Rate CD and IRA that allow you to opt into a higher rate that becomes available during the term. The fact that they also don’t have a required minimum opening deposit makes these accounts accessible to more people and extremely convenient for those already banking with Ally.

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Auto Loan, Reviews

LightStream Auto Loan Review

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The editorial content on this page is not provided by any financial institution and has not been reviewed, approved or otherwise endorsed by any of these entities.

LightStream Auto Loan Review

Updated December 13, 2016

Automobile shopping can be stressful. Besides trying to find just the right car for you or your family, there is the additional stress of finding the right price, the right financing, as well as factoring a monthly payment into your budget.

But with more online-only banks offering auto loans at extremely competitive interest rates, the auto loan game is changing. Today, your best bet is to obtain financing before setting foot in a dealership so you have a budget to stick to and you know exactly what your monthly payment will be.

The Offer

LightStream offers both secured and unsecured auto loans from $5,000 to $100,000 and rates as low as 1.99% for used cards. LightStream can get money in your account in as little as one day in some cases, and always with no fees whatsoever.

How To Apply

You can complete your LightStream auto loan application online, but you must 1) acknowledge receipt of LightStream’s Statement on the Use of Electronic Records, 2) agree to receive electronic records, and 3) agree to use electronic signature to sign your loan documents.

In order to apply, you will need:

  • The purpose, term and amount of desired loan
  • Your name
  • Your address
  • Phone number
  • Social Security number
  • Employment information
  • Annual income
  • Total amount of assets and equity in your home

During business hours, LightStream will email you regarding your application. If you are approved, you will be able to then go online, electronically sign your loan agreement, provide any additional information, as well as choose your funding and due dates. The funds will be transferred to your bank account on the funding date that you chose, on the same day in some cases.

To qualify, you must have either excellent or good credit. LightStream lists the following as criteria for excellent credit:

  • Five or more years of significant credit history.
  • A credit history with a variety of account types such as major credit cards (for example, Visa, MasterCard, Amex), installment debt (vehicle loans) and mortgage debt if applicable.
  • An excellent payment history with no delinquencies or other problems repaying debt obligations.
  • A proven ability to save evidenced by some or all of the following; liquid assets (stocks, bonds, bank deposits, etc.), cash down payments on real estate, retirement savings, and little, if any, revolving credit card debt.
  • Stable and sufficient income and assets to easily repay current debt obligations and any new loan with LightStream.

Good credit is essentially the same criteria as excellent credit, as seen above, but with fewer than 5 years of credit history.

Satisfaction Guarantee

LightStream does not provide any phone customer support for loans. Instead, it offers email support in an effort to keep costs low. Because the lack of phone support is unorthodox, it offers a $100 guarantee within 30 days if you aren’t satisfied with your loan experience. If you are not satisfied and wish to claim the $100 guarantee, you must contact customer service within 30 days of your loan and fill out a questionnaire.

The Fine Print

Your APR will be based on creditworthiness, loan amount, and loan term, as seen in the chart below for an auto-loan on a new car:

The Fine Print

Rates in the chart above are shown inclusive of a 0.50% AutoPay Discount. If you choose not to enroll in AutoPay, your rate will reflect a 0.50% increase. AutoPay payments will come directly out of your bank account. Otherwise, you can choose to pay by invoice, which must be returned by mail. You cannot make payments at a SunTrust Bank branch.

LightStream does not charge any closing or disbursement fees. It also does not charge fees for prepayment. You can prepay principal on your loan by logging into your online account.

Pros

  • Rates as low as 1.99%
  • Can borrow as little as $5,000 or as much as $100,000
  • You can borrow for a new or used car
  • Terms from 24 to 84 months
  • No prepayment penalties
  • No closing or disbursement fees
  • Secured and unsecured loans

Cons

  • APRs as high as 6.29%
  • APR will increase 0.50% if you don’t enroll in AutoPay
  • Excellent or good credit required for financing

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How It Stacks Up

If a low APR is your priority, consider looking into an auto loan from Capital One. It offers APRs from 1.99% to 2.49% and terms of 36 to 72 months on new vehicles.  There is no origination fee, but it only offers loans up to $40,000, with the option to get pre approval online before shopping.

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New England Federal Credit Union is another option for an auto loan with rates from 1.45% to 13.99% and terms from 12 to 96 months on new vehicles and 84 months on used cars. NEFCU can loan up to $70,000 with no origination fee, but there is no option for pre approval.

New England Federal Credit Union

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LightStream offers a fairly straightforward auto loan experience whether you’re buying a new or used auto with low rates, long terms, and no fees for closing, disbursement, or prepayment. As with any loan, make sure that you are getting the lowest rate possible, as even one percentage lower can save you thousands of dollars in interest.

Finally, make sure that you can afford the monthly payment. Auto loan terms are getting longer, and you do not want to have an auto loan payment that is more than you can afford for 6+ years.

Find other auto loan options here.

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Credit Cards, Reviews

Chase Sapphire Preferred Review: What To Know Before You Apply

Advertiser Disclosure

The editorial content on this page is not provided by any financial institution and has not been reviewed, approved or otherwise endorsed by any of these entities.

travel train

The information related to Chase Sapphire Preferred credit card has been collected by MagnifyMoney and has not been reviewed or provided by the issuer of this card.

If you want a rewards credit card, Chase Sapphire Preferred is worth considering. However, the card is not right for everyone.

Here are the highlights:

  • A great sign-up bonus of 50,000 points if you spend $4,000 on purchases in the first three months from account opening.
  • No annual fee during the first year. There is an annual fee of $95 in subsequent years.
  • Earn 2 points for every $1 spent on travel and dining. If you spend a lot of money on travel and dining, this is a great way to boost your earnings.
  • If you redeem your points for travel using the Chase Ultimate Rewards portal, your points are worth 25% more. For example, that 50,000 point sign-up bonus could be worth $625 of travel purchases.
  • You can also transfer your points to leading airlines (like United and Southwest) or hotels (like Marriott or Hyatt) on a 1:1 basis.

The most value goes to people who spend a lot of their money on travel or dining and want to redeem their points for travel. If you are a foodie and traveler looking to get free trips faster, this card is a great tool to earn free travel fast. Depending upon how much you spend on travel, you might even want to consider the Chase Sapphire Reserve instead. The Reserve was just recently introduced and is Chase’s most exclusive card yet. You get a 100,000 point sign-up bonus (instead of 50,000 points). You earn 3 points for every $1 spent on dining and travel (instead of 2 points). But you have a $450 annual fee (instead of $95), and it is not waived during the first year.

The least value goes to people who spend very little or no money on travel or dining and want to redeem for cash back or gift cards. Spending on all other categories (outside of travel and dining) only earns 1 point per $1 spent. And every 100 points is worth $1 of cash back. That means you would only be earning 1% cash back, which is a very low rate. Using our guide to the best cash back credit cards, you should be able to earn at least 2% on your spending.

How to Earn Points

You can earn 2 points on every dollar spent on travel (from cabs to airplane tickets) and dining. In order to get 2 points, the merchant needs to be classified as a “restaurant” or “travel.”

Dining is a relatively simple classification. All restaurants should classify as dining. Many bars (even those that don’t serve food) can be classified as “dining.” And even most popular food delivery services are categorized as dining (although there have been some reports of GrubHub not always earning 2x points). Here is the exact definition from the Chase website:

  • Merchants in the restaurants category are merchants whose primary business is sit-down or eat-in dining, including fast food restaurants as well as fine dining establishments. Please note that some merchants that sell food and drinks located within larger merchants such as sports stadiums, hotels and casinos, theme parks, grocery and department stores will not be included in this category unless the merchant has set up such purchases to be classified in a restaurant category.

The “travel” category is actually a lot broader than you might imagine. Paying for airplane tickets and hotel stays definitely counts as travel. But Airbnb, New York taxis, and even highway tolls will also count as travel. Here is the exact definition from Chase:

  • Merchants in the travel category include airlines, hotels, motels, timeshares, car rental agencies, cruise lines, travel agencies, discount travel sites, campgrounds and operators of passenger trains, buses, taxis, limousines, ferries, toll bridges and highways, and parking lots and garages. Please note that some merchants that provide transportation and travel-related services are not included in this category; for example, real estate agents, in-flight goods and services, on-board cruise line goods and services, sightseeing activities, excursions, tourist attractions, merchants within hotels and airports, and merchants that rent vehicles for the purpose of hauling. In addition, the purchasing of points or miles does not qualify in this category.

You will earn 1 point per $1 spent on all other spending with your Chase Sapphire Preferred card.

There is no maximum to the number of points that you can earn.

How Much Are the Points Worth?

When you earn points with the Chase Sapphire Preferred card, you are earning “Ultimate Rewards” points. There are a number of ways that these points can be used. How valuable each point is depends on how you choose to use it.

Here’s a summary:

  • When you redeem points for cash, a statement credit, or a gift card: every 100 points earned = $1
  • When you redeem points for travel using Chase’s Ultimate Rewards travel portal: every 100 points = $1.25
  • When you transfer points to travel partners: It depends upon the award that you are able to get in the program. For example, you could get a round-trip ticket to Europe on United Airlines for as few as 115,000 miles round trip or as many as 300,000 miles. You just have to shop on the United Airlines website to see how many miles they are charging for the flight. Unfortunately, the number of miles is determined by the airline and is at their discretion.

Who the Chase Sapphire Preferred Card Doesn’t Work For

If your objective is to earn cash back on all your purchases, Chase Sapphire Preferred is not the best option for you.

Why? Every 100 points you earn is only worth $1. That means you will get a 2% return on restaurant and travel spending, and only 1% return on everything else. You can do a lot better with a cash back credit card like the Citi Double Cash, which offers 2% cashback on all purchases.

Redeeming Points for Travel Rewards

As a Sapphire cardholder, you can book travel using the Ultimate Rewards travel portal. You can book flights, hotels, car rentals, and other activities using the portal. The travel portal is like your own online travel agency:

who-the-chase-sapphire-preferred-card-doesnt-work-for

To pay for the travel, you can use Ultimate Reward points, your Chase card, or both. Your Ultimate Rewards points carry even more value when you book using the portal. You only need 80 points to cover $1 of travel expense. For example, if an airfare is $500, you would only need 40,000 points to pay for the ticket. If you only had 30,000 points, you could apply those toward the balance and use cash or your credit card to cover the rest. The 30,000 points would deduct $375 from the purchase price, and you could pay for the remaining $125 out of pocket.

Booking travel through the portal really boosts the value of your credit card. That means you are actually earning:

  • 2.5% on every $1 you spend on restaurants and travel
  • 1.25% on every $1 you spend on everything else — and you can boost this by using Chase Freedom Unlimited (see below)

Transfer to Travel Partners You have the opportunity to earn the best possible return when you transfer your points to a travel partner. Ultimate Rewards has an amazing coalition of travel partners where you can transfer your points 1:1. These include: =

  • Airlines: United Airlines, Southwest Airlines, and a number of foreign carriers (including British Airways, Air France, Korean Air, Singapore Airlines, and Virgin Atlantic)
  • Hotels: Hyatt, IHG, Marriott, and Ritz-Carlton

The value of your points when transferred depends upon how you redeem them. You will get some of the best returns (and the most fun) when you can you nab a coveted “saver” travel award through one of Chase’s partner airlines. Most airlines have different tiers of fares that are reserved for people who are booking using miles or points. “Saver” awards are often the most deeply discounted and that’s when you get the most bang for your buck when it comes to redeeming points.

For example, we recently looked up a trip to London from Newark on the United Airlines website for a four-day weekend in April. Using our award points, we found a round-trip “saver” award fare for just 115,000 points for business class flight. That same flight cost nearly $5,000 in cash.

If you use those 115,000 points to book travel on the Chase Ultimate Rewards portal, it is worth $1,725. And if you want to convert those points into cash deposited into your bank account, it would be worth $1,150.

With some advance planning, you can get the biggest returns on your Chase points by transferring your points to Chase airline partners and finding deals on international business class flights. But you have to plan in advance and have a flexible travel schedule if you want to get the best business class redemption opportunities.

Remember: You can transfer points from Ultimate Rewards to your existing frequent flier accounts. If you have 40,000 miles in your United Airlines account already and need more miles for an award, you can easily (and instantly) top up your existing account by transferring at a 1:1 ratio.

Boost Your Earning with Chase Freedom Unlimited

One of the weaknesses of the Chase Sapphire Preferred credit card is that you only earn 1 point on all of your spending outside of the restaurant and travel categories. Fortunately, there is a way to boost your earnings.

Chase recently introduced the Chase Freedom Unlimited credit card. With this credit card, you earn 1.50 Ultimate Rewards points for every $1 you spend. The good news is that you can combine those Ultimate Rewards points with your Chase Sapphire Reserve Ultimate Reward points. Even better: There is no annual fee on the Chase Freedom Unlimited credit card.

To get the best value, use:

  • Chase Freedom Unlimited for all purchases except dining and travel, and
  • Chase Sapphire Preferred for all dining and travel purchases, and
  • Use your points to redeem for travel on the Ultimate Rewards portal or get a great deal redeeming frequent flier miles with one of the travel partners

If you do that, you will be earning at least:

  • 2.5% on dining and travel (using Chase Sapphire Preferred), and
  • 1.875% on everything else (using Chase Freedom Unlimited)

The returns could be even higher if you transferred your points to a travel partner and snagged a great reward ticket.

What Are the Fees and Charges Associated with the Card?

Here are some of the key fees and charges that come with the Chase Sapphire Preferred card:

  • Annual Fee: $0 Introductory fee for the first year. After that, $95
  • Foreign Transaction Fee: None
  • Late Fee: Up to $15 if the balance is less than $100; up to $27 if the balance is $100 to less than $250; up to $37 if the balance is $250 or more

Having no foreign transaction fee is an excellent benefit, especially if you are a frequent traveler. There are still cards out there charging a hefty 3% on all foreign purchases.

Figuring out whether or not to pay the annual fee does take a little extra work. Remember that you can easily earn 2% cash back with the Citi Double Cash credit card, which has no annual fee. That is the baseline return. If you spend $2,000 a month, you could earn $480 a year in cash back. Can you beat that return?

If you are a foodie and world traveler, and you spend all $2,000 a month in the dining and travel categories, you can be much better off with Chase. If you use your card to redeem for travel or transfer to partners, you should be able to earn at least a 2.5% return. That means $20,000 of spend in the dining and travel categories would get you $600 of value before the annual fee. After the annual fee of $95, you would get $505 of value during the ongoing years — which is a better deal than the flat 2% card. And there is a reason the Chase Sapphire Preferred card is such a great option for travelers: you can get even better returns when you use your miles strategically, and the more you spend in dining and travel categories (above $20,000 a year), the better the card.

This card is not ideal for people who:

  • Do not spend a lot of money in travel and dining categories
  • Do not want to redeem their points for travel (would rather have the cash)

Other Card Benefits

In addition to earning points, there are a number of other benefits that come associated with the Chase Sapphire Preferred card. You can tell that this card is targeted toward the traveler because some of the richest (and, in our opinion, best) benefits are travel related. Make sure you understand them because if you are a regular traveler, you will likely have the opportunity to take advantage of them.

Car Rental Insurance

With this card, you get a primary auto rental collision damage waiver benefit. If you decline the auto rental company’s collision insurance and charge the entire rental cost to your card, you can receive coverage that provides reimbursement for up to the actual cash value of the vehicle for theft and collision damage for most rental cars in the U.S. and abroad. Having primary coverage is a big deal — it means you don’t have to submit a claim to your own auto insurance company first (which could result in higher insurance rates after a claim).

The insurance provided on the credit card only deals with collision. You need to have a strategy in place for other risks. Auto insurers typically sell four types of policies. They are:

  • Collision (Loss Damage Waiver): Your Sapphire card can replace this.
  • Liability: If you damage someone else’s property or person, you could be held liable (and the amount of the liability could be significant). You should check to see if your existing auto insurance provides liability coverage on your rental. If it doesn’t, or if you don’t have an auto insurance policy, consider buying that protection at the counter.
  • Personal Effects: This policy protects any items that are damaged while in the rental car. Depending upon your situation, you might not need this coverage.
  • Personal Accident Insurance: This is typically a health care policy that is not necessary if you have sufficient coverage from your existing health insurance.

If you are renting a car overseas, be sure to check with your credit card before traveling to make sure you are covered in that country.

Trip Delay

Remember when airlines used to provide you with a free hotel room if you got stuck somewhere overnight? Not any longer. Thankfully, Chase Sapphire Preferred steps in to the rescue.

If your common carrier travel is delayed more than 12 hours or requires an overnight stay, you and your family are covered for unreimbursed expenses, such as meals and lodging, up to $500 per ticket.

Baggage Delay

You can get reimbursed for essential purchases like toiletries and clothing for baggage delays over six hours by passenger carrier up to $100 a day for five days.

Trip Cancellation

If your trip is canceled or cut short by sickness, severe weather, and other covered situations, you can be reimbursed up to $10,000 per trip for your prepaid, nonrefundable travel expenses, including passenger fares, tours, and hotels.

Other Benefits

The Chase Sapphire Preferred card also offers purchase protection, price protection, return protection, and extended warranty protection benefits.

How to Get Approved

As you can tell from the details of the Chase Sapphire Preferred card, it comes rich with rewards and benefits. And it targets people with excellent or good credit.

If you have a low credit score (below 650) or you have missed a lot of payments historically, you will likely be rejected.

People with the best chance of being approved have scores well above 700.

If you have a bad credit score and are looking for a credit card, you can review our guide here.

An Example of Who Gets the Most from the Chase Sapphire Preferred Card

Here is a profile of an ideal Chase Sapphire Preferred customer:

Mary lives in New York City. She doesn’t have a car (because she uses the subway), and she spends a ton of money eating out and traveling. She has a good job and a good credit score but would love to travel even more.

This card is ideal for Mary because:

  • So much of her spending is on dining and travel, which earns at the highest level.
  • She wants to earn free travel, and the redemption opportunities are richest when redeemed for travel.
  • She doesn’t have primary auto insurance (because she doesn’t have a car) so the primary auto rental benefit is ideal.
  • She has excellent credit.

If that sounds like you, Chase Sapphire Preferred is a great addition to your wallet or purse.

An Example of Who Gets the Least from the Chase Sapphire Preferred Card

Here is a profile of someone who might be better off with a different card:

John is a father of three. He spends a lot of money on groceries (to feed his growing family) and gas (to drive to all of his children’s events). He just doesn’t have the money to eat out, and hopes to do some traveling later in life — once he funds three college educations.

There are other options that would be much better for John. Because none of his spending would be in dining or travel, he would only be earning 1 point for every $1 spent. Because he would not be redeeming his points for travel, he would likely be earning only 1% on his spending. John would be better with a cash back credit card that better rewarded his spending patterns.

Should I Consider the Chase Sapphire Reserve Instead?

In the last year, Chase also introduced the incredibly popular Chase Sapphire Reserve credit card. Here are the key differences between Sapphire Preferred and Sapphire Reserve:

  • There is an annual fee of $450. It is not waived during the first year. However, you can receive up to $300 in statement credits annually as reimbursement for travel purchases such as airfare and hotels charged to your card.
  • You earn 3 points on travel and dining, instead of 2.
  • When you redeem for travel on the Chase travel portal, you get 50% more value (compared to only 25% more value for Sapphire Preferred).
  • Just like the Sapphire Preferred, you earn 1 point for every $1 spent in all other categories (excluding dining and travel).

For spending in travel and dining that is redeemed on the Chase travel portal, you get incredible value. Every $1 spent on travel and dining is worth 3 points. And 3 points redeemed for travel on the Chase travel portal would be worth 4.5 cents. That means you could get an incredible 4.5% of value on the Reserve compared to 2.5% on Preferred.

When you decide between the two cards ask yourself the following question:

  1. Do you spend at least $300 a year on travel? If yes, answer the next question. If no, the Reserve card might not be for you.
  2. If you spend at least $300 on travel and more than $3,750 a year in travel and dining combined — you will be better off with the Reserve card.

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College Students and Recent Grads, Reviews, Student Loan ReFi

LendKey Student Loan Refinance Review

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The editorial content on this page is not provided by any financial institution and has not been reviewed, approved or otherwise endorsed by any of these entities.

LendKey Student Loan Refinance Review

Updated December 13, 2016

Could you imagine trying to find the best student loan refinancing rate from community banks and credit unions on your own? How would you do it? Would you call every bank and credit union and ask for help? What a nightmare.

LendKey has relationships with 300+ community banks and credit unions all over the United States. LendKey* can issue loans to residents in any of the 50 states. This keeps you from having to pound the pavement by your lonesome. LendKey’s website will show you the best rate for refinancing your student loans.

Since 2007, LendKey has been a one stop shop for student loan refinancing. It also offers other types of loans. But for the sake of this review we’ll be focusing on how LendKey takes care of graduates looking to improve their debt situation. Fixed APRs range from 3.25% – 7.26%. Variable rates start as low as 2.09%. LendKey is one of the top four lenders in MagnifyMoney’s survey of where to refinance your student loan.

Who can benefit from using LendKey? Anyone hoping to refinance their student loans should consider LendKey. It is easy to apply:

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If you’re on the fence about refinancing, here are some of the benefits to be gained:

Lower Payments

Refinance your way to a more manageable monthly payment.

Lower Rates

Spend less on interest by getting a lower rate than the aggregate of all individual student loans.

Simplified Finances

Making payments on multiple loans to multiple institutions at different times of the month can be quite the hassle. It’s much easier to remember just one payment. Many lenders even let you consolidate both private and federal loans.

Different Repayment Options

Different lenders offer different repayment options. It’s wise to explore all the options to determine what makes the most sense for your particular situation.

Pros of Using LendKey

A Unified Application Process

This is hugely important. With LendKey, you’re not shuffled through tons of screens on different domains – all using different logons and different (confusing!) user interfaces. Within 5 minutes, a person can navigate through LendKey’s application process. This means after 5 minutes, you can see how much you can save by refinancing. You can even choose what loan you want.

Cosigner Release Available

Yes, you can secure a low interest rate and then cut loose your cosigner. Once you prove you are responsible – LendKey no longer needs a cosigner tied to your account. This may help convince a cosigner to work with you initially. They won’t need to be on the hook for long. Once you’ve made 12 full and consecutive on-time payments, your cosigner may be released. LendKey does a credit check and examines your income to see if you are free to go it alone.

No Origination Fee

This is helpful since it means you are free to shop around without feeling committed.

Further Interest Rate Reduction

1% interest rate reduction once 10% of the loan principal is repaid during the full repayment period. This is subject to the floor rate.

0.25% ACH Interest Rate Reduction

Many lenders reduce interest rates by a quarter percent for borrowers who agree to automatic payments.

Federal and Private Loans Can Be Consolidated Together

However, you lose some federal benefits in doing so. Things like free insurance (provided with federal loans if you are killed or severely disabled), public service forgiveness and military service forgiveness as well as income-based repayment plans. Grace periods will likely be omitted when writing the new consolidated loan.

Over 40,000 Borrowers Serviced

As of January 2016, 40,000 people have used LendKey’s services.

Excellent Customer Support

According to cuStudentLoans (which LendKey owns so take this with a grain of salt), 97% of customers are satisfied. Customer support comes out of New York and Ohio. Phone support is available each day from 9AM to 8PM EST.

For what it’s worth, I called into support 5 times at random. The support I received from the sales team was really great. Even the gentleman with only 6 months of experience was quite knowledgeable.

Eligible Schools

This list of eligible schools is 2,200 and growing. Chances are your school is on the list. However, LendKey doesn’t encourage students to submit eligibility requests as other student loan refinancers do.

Return Policy

Yes, you can ‘return’ your loan. LendKey offers a 30 day no-fee return policy to allow you to cancel the loan within 30 days of disbursement without fees or interest. That’s pretty incredible.

Cons

LendKey Doesn’t Give You the Complete Picture

LendKey doesn’t help a lot with stacking institutions against each other. I suppose this is meant to not to play favorites. However, it would be nice to be able to read about each institution within the LendKey interface. I’d still advise opening up another tab to research the banks you are considering.

The Fine Print You May Miss

Since LendKey is a loan matchmaker, there isn’t a lot of fine print on the site. This means a person still needs to review the fine print of each institution before finalizing his or her loan as mentioned before. LendKey does a fantastic job of getting you 90% of the way. But that last 10% of fine print is between you and your lending institution. Read through everything before signing up for a new loan.

I read the Better Business Bureau complaint log for LendKey. There are only 11 complaints in the past 3 years. SoFi (a competitor) has 18 and another competitor, Earnest, has no complaints. These complaints were mostly small misunderstandings between the LendKey support team and the borrowers.

The Application Process

There are four steps to the simple application process. Step 1 is for estimating monthly payments for a private student loan. It’s simple. You identify the amount you’d like to borrow and fill in a radio button indicating your credit is fair, good, or excellent. The last part is where you enter which state you live in. This is because many programs are state specific. Step 1 takes 1 minute.

Step 2 takes 2 minutes. This is the step where you compare the rates and offers available to you. Choose what works best for your unique situation.

Step 3 again only takes 1 minute. This is the actual application. As mentioned earlier in this article, this process is done through the LendKey interface. And don’t worry, information inputted into LendKey is safe (privacy policy).

Step 4 takes 10 minutes. This is the step where a person verifies identity, school, and income (screenshots/pictures work so there’s no hassle with scanning!). You will know if you are approved during this step.

As with any company, there are competitors. Here are two worthy rivals also worth considering:

Alternatives to LendKey

SoFi

SoFi stands out with a job placement programs, free wealth management for borrowers and even a dating app. More importantly, SoFi has low interest rates, with variable rates starting at 2.345% and fixed rates starting at 3.375%.

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Earnest

If you have a low credit score but have potential to earn a good income, Earnest will treat you well. Earnest looks beyond a simple credit score. The application process examines employment history, future earning potential and overall financial situation.

Earnest seems to take a very personal approach to each customer. A customer states an amount they can pay each month and Earnest will give them a loan, accordingly. Earnest also lets borrowers skip a payment each year. This could come in handy if money gets tight around the holidays. Just keep in mind, this can increase your future payments to compensate for the missed on.

Fixed interest rates start at 3.38% and variable interest rates start at 2.34%.

However, Earnest isn’t available for all US residents.

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Final Thoughts

LendKey runs a fantastic student loan refinancing division. The company offers many, many customizable options with very few downsides. With no application fee, it’s worth seeing what this student loan refinancing powerhouse can do for you.

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 *We’ll receive a referral fee if you click on offers with this symbol. This does not impact our rankings or recommendations. You can learn more about how our site is financed here.

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Reviews

Review: American Express Personal Savings High Yield Savings Account

Advertiser Disclosure

The editorial content on this page is not provided by any financial institution and has not been reviewed, approved or otherwise endorsed by any of these entities.

plants on piles of euro coins

There’s no question having a savings account is necessary to get your financial house in order. Savings accounts are great for storing your emergency fund, planning for upcoming purchases like travel or special events, and more. But it can be frustrating to earn little interest on your money while it’s sitting in a savings account at a physical bank, which is why many people have turned to online banks where interest rates on savings and checking accounts are typically higher.

Online banks are able to offer higher interest rates on savings and checking accounts because there are less overhead costs than for brick-and-mortar banks. One online savings account option to consider is an American Express Personal Savings High Yield Savings Account.

American Express Personal Savings High Yield Savings Account Overview

The American Express Personal Savings High Yield Savings Account currently offers 0.90% annual percentage yield (APY). However, this interest rate is subject to change without notice, which is pretty typical for most online banks. There is no minimum deposit required to open an account, but the funds must come from an external account under your same name held at a different bank. Your initial deposit must be sent within 60 days of being approved or your account will be automatically closed.

There are no monthly maintenance fees associated with this savings account, and you can link it to more than one financial institution or current bank account to make deposits and withdrawals.

Funds are FDIC insured up to $250,000, the same as money at a physical bank.

Making a Deposit into an American Express Personal Savings High Yield Savings Account

Once your account has been opened and initially funded, you will need to link any other external checking or savings accounts to your American Express Personal Savings account in order to transfer funds electronically. External accounts must belong to you and have the same ownership as your Personal Savings account. After you have entered your account information to link it, you will be sent test deposits of small amounts to verify your information is correct.

Funds transferred electronically are generally available within five business days.

In addition to electronic transfers, you can deposit physical checks by mail. If you write a check from another bank, make it payable to American Express Bank, write your Personal Savings account number on the memo line, and mail it to:

American Express Bank, FSB

P.O. Box 30384

Salt Lake City, UT 84130

If you send a check made payable to you, sign the back and under your signature write “for deposit only in account” followed by your Personal Savings account number. However, it is more secure to send a check made out to American Express Bank. American Express does not accept cash deposits by mail.

The maximum account balance you can have in an American Express Personal Savings account is $5 million.

Withdrawing Funds from an American Express Personal Savings High Yield Savings Account

A Personal Savings account with American Express is not meant to be used for everyday spending and other transactions, and thus does not come with an ATM card, debit card, or checks. The Federal Reserve Board’s Regulation D allows a maximum of six transfers or withdrawals per statement period for savings accounts and money market accounts within any bank.

That said, withdrawing funds electronically is just as easy as depositing them. You can make transfers to your linked external accounts within your account online. Transfers to external accounts can take one to three business days, if the account is already linked to your Personal Savings account.

Keep in mind internal transfers from one American Express Personal Savings High Yield Savings Account to another will count toward the limit of six withdrawals per month.

However, if you call and request an official check by mail, this will not count toward the limit.

Pros and Cons

Overall, there are more pros than cons with this account. No monthly fees and a higher interest rate on savings is a big pro versus keeping your money in a savings account at a brick-and-mortar bank. Also, there is no minimum required to open or maintain an account. Even with a $0 balance, American Express will not close your account unless it has been inactive for over 12 months.

However, one disadvantage to keeping your money in an online savings account is the waiting period it takes to access your money. It can take one to three business days to transfer your money to an external account. This can be an inconvenience if you are facing a financial emergency, which is why it’s a good idea to always keep a buffer in your checking or savings account in your physical bank.

Alternatives to the American Express Personal Savings High Yield Savings Account

If a higher interest rate on your savings is really what you are after, the Ally Bank Online Savings Account could be a better alternative as it currently offers 1.0% APY on balance of all sizes. However, Ally Bank does have some fees you’d have to watch out for, like an excessive transaction fee of $10 per transaction and a $20 fee for outgoing domestic money wires.

Barclays Online Savings Account also currently offers 1.0% APY, and their tools can help you set savings targets to reach your overall financial goals. You can use Remote Deposit to transfer money into your Barclays Online Savings Account from your computer or smartphone. Funds received electronically or by check will be on hold for five business days after they reach your account.

Another alternative to consider is opening up a certificate of deposit (CD) instead of a high-yield savings account. American Express currently offers CDs for 24 months at 1.0% APY or more for longer periods of time. The rate will be fixed when you complete your application, as long as you fund your CD within 30 days and do not withdraw interest before the maturity date. Early withdrawal of interest will hurt your future earnings, and early withdrawal of principle will result in a penalty. This is why CDs are good for investing money for short periods of time but may not be the best emergency fund option.

Who Will Benefit Most from an American Express Personal Savings High Yield Savings Account?

Anyone looking to earn money on their savings will benefit from an American Express Personal Savings High Yield Savings Account. Just remember you are limited to no more than six withdrawals or transfers per statement period, and it can take up to three business days to receive your money in an external account.

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