CreditStrong review
- Fee
- From $28 per month
- Minimum deposit to open
- $0
Our verdict
This division of Austin Capital Bank offers many credit-building loans to choose from, but they can be costly.
Part of the FDIC-insured Austin Capital Bank, CreditStrong offers a variety of credit-builder loans to help customers build a credit history and savings. There are multiple plans to choose from, including revolving and installment credit-builder loans for individuals, teens and businesses. Unlike traditional loans, there’s no hard credit check when you apply. But you'll have to pay interest charges and a one-time administrative fee, which you’ll be informed of right before you sign on the dotted line. Also, before applying, pay attention to the term length, as some have terms up to 120 months, so it's a commitment. And watch out for high APRs, considering these products don’t require a credit check.
Best for: Poor credit borrowers who want to build credit history.
Pros
-
No credit check
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Reports to the three major credit bureaus
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No opening deposit
Cons
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$15 to $25 non-refundable administrative fee
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APRs up to 15.88%
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Pricing isn’t always transparent
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Not available in Wisconsin or Vermont
Who is CreditStrong best for?
CreditStrong is best for someone with poor credit who can’t get a credit-builder loan or a new line of credit through their bank or credit union. CreditStrong’s credit-builder loans don’t have a hard credit check, so a poor credit history isn’t a factor in approval.
How CreditStrong works
The majority of CreditStrong’s products are installment credit-builder loans. Credit-builder loans can help you build a better credit history and a little nest egg.
Unlike traditional loans, you don’t get funds upfront with credit-builder loans. Installment credit-builder loans involve making monthly payments deposited into a savings account. Once you’ve paid the full amount, you get your funds back and can walk away with a better credit score — provided you made timely payments throughout the loan. These monthly payments are integral to a credit-building loan, because those payments are reported to the three major credit bureaus so you can build credit history.
For example, if you choose a $1,000 credit-builder loan with a $15 monthly payment over X months. Once you’ve paid the full $1,000, the funds are released minus interest charges and finance fees.
Most credit-builder loans don’t require a monthly service fee. In most cases, including CreditStrong, the cost of a credit-builder loan is the acquired interest. These loans deposit your monthly payments in a savings account, and the bank collects APR as a cost for the service.
| Provider plan | Best for | Cost | Amount released at end of term | APR |
|---|---|---|---|---|
| Magnum 5000 | Personal | $60/month and one-time $25 administrative fee | $5,000 | 7.86% |
| Magnum Self X-Large Builder | Personal | $150/month and one-time $25 administrative fee | $3,076 | 15.88% |
| Magnum XL 15k | Personal | $175/month and one-time $25 administrative fee | $15,000 to $30,000 | 7.15% |
| Revolv (revolving credit line) | Personal | $99/year | $1,000 to $3,000 | N/A |
| Instal | Personal | $28 to $48/month | $1,000 to $1,100 | 15.51% to 15.73% |
| CS Max | Personal | $49 to $499/month and one-time $25 administrative fee | $2,500 to $10,000 | 3.02% to 7.31% |
| FreeKick | Building children’s credit aged 14 to 25 | $149/year, or one-time $3,000 deposit | Varies | Unclear |
| Credit Strong for Business | Businesses | $200 to $2,000/month and a $349 to $999 one-time fee | $5,000 to $50,000 | N/A |
Where CreditStrong shines
CreditStrong’s biggest leg-up in the competition is the lack of a hard credit check. While many credit-building loans are designed for poor credit borrowers, traditional banks and credit unions typically check your credit and have credit score requirements. CreditStrong doesn’t check your credit when you apply, so your main approval variable is your ability to pay.
CreditStrong also reports to all three major credit bureaus: Experian, Equifax and TransUnion. This is comforting to see, as some credit-building products only report to one or two major agencies.
You can also close your account early if you want, with no early closure fees, and there are no prepayment penalties if you want to pay off the loan faster than planned.
Variety of options
CreditStrong features multiple plans to choose from, each varying in monthly payments, loan size and APR. The majority of CreditStrong’s plans don’t require an opening deposit, and instead a small, one-time administrative fee. Most have the expected monthly payment, with two exceptions: Revolv has a yearly fee with optional monthly savings payments, and FreeKick includes a yearly fee or free option with deposit.
Most of the plans are for individuals looking to build credit, but the other options like FreeKick is suited for families (one account covers up to two parents and six children), and CreditStrong for Business builds business credit.
Where it falls short
One of CreditStrong’s strengths is its variety of products, but it’s a double-edged sword. There are almost too many options and terms to choose from, which makes it hard to sort through. On top of that, CreditStrong has multiple divisions of itself, and it’s also a division of another bank, which can easily create confusion and make you wonder who you’re really getting the loan from. If CreditStrong could do anything better, we’d narrow down its offerings.
Also, many of the plans have a $15 to $25 non-refundable administrative fee. There’s also a late fee if you’re more than 15 days on a payment, and the late fee amount isn’t disclosed.
These loans can be costly
After you choose a loan and apply, CreditStrong will inform you of your APR, finance charge, amount financed, account terms, and total number of payments. The APR and administrative fee you get will depend on your plan, and CreditStrong’s APRs can be as high as 15.88%.
Credit-building plans for kids are unclear
The kids’ credit-building plans are through FreeKick, which is part of CreditStrong. These plans have a heavy focus on preventing identity theft and building credit for kids aged 14 to 25. However, the site is hard to navigate and we’ve received some differing information on how these plans work.
The site states that parents get their deposited funds back and earn interest once the loan is closed. We talked to multiple representatives about this product, with one stating the account is charged APR and is paid to FreeKick as a fee for the service, and another rep told us the account earns 5% to 7% APY. And yet another representative told us that the account has a 0.01% APR. These discrepancies may be the result of FreeKick changing its plan offerings, terms and rates multiple times since its launch.
As of June 2024, CreditStrong informed us that FreeKick deposits earn interest and there are no APR charges, though the APY is not listed.
Compare CreditStrong to other credit-building products
Narrow down top credit-building options by monthly fees, benefits and more. For a better comparison, tick the Compare box on up to four different options to see them side by side.
How to open CreditStrong
The first step in opening a credit-building loan with CreditStrong is choosing a plan you can easily afford. Since the goal with a credit-building loan is to improve your credit score, you don’t want to choose a plan that overextends your budget — or you’ll just worsen your credit instead of helping it.
After you’ve selected a CreditStrong option, you’ll need to create an account, apply for the loan of your choosing and start making payments.
CreditStrong has these eligibility requirements:
- 18 years old and a permanent US resident
- Valid SSN or ITIN
- Checking account, debit card or prepaid card in good standing
- Mobile phone number, Google Voice account
- Email address
There are no set income requirements or credit score requirements to qualify for a CreditStrong product.
Customer experience
CreditStrong is a of the FDIC-insured Austin Capital Bank and holds a decent B rating with the Better Business Bureau. There are a handful of customer complaints, but there’s a consistent theme among them: Customers claim that CreditStrong is keeping a majority of their payments made into the credit-builder loan and taking a lot of the funds through interest charges. Other customers feel bamboozled by CreditStrong, stating they never received their loan funds.
On the side of CreditStrong, credit-building loans don’t offer any funds upfront because that’s just not how they work. And, in most cases, the cost of these loans is in interest charges accrued throughout the loan.
Based on the majority of customer feedback, there looks to be a lot of confusion as to what CreditStrong’s products actually are and how they work. Regardless if that’s human error on the customer’s side or CreditStrong’s lack of transparency, we can say that CreditStrong doesn’t make it easy to locate the total cost of these products on their site, and it lacks detail on how these loans work.
Frequently asked questions
When do I receive my CreditStrong loan?
Unlike traditional personal loans, a credit-building loan won’t give you funds after you apply. Credit-building loans mean you’ll pay a monthly installment over the term, and once you’ve paid the full amount, the funds are released to you minus fees and interest.
How much does CreditStrong cost?
The overall cost of a CreditStrong credit-building loan varies. You’ll pay interest throughout the loan, as well as a one-time, non-refundable administration fee between $15 to $25. APRs vary depending on the loan you choose but could be as high as 15.88%. And if you’re late on a payment by more than 15 days, there’s a late fee.
CreditStrong doesn’t charge membership fees or monthly service fees. These products make money from acquired interest over the term.
Your reviews
Bethany Finder
Editor, Banking
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