- 1). Pick a bank or credit union that you would like to use to start a secured loan. Usually smaller, local institutions will be willing to help you obtain your secured loan.
- 2). The secured loan is called a "secure" loan because the bank uses either a savings account or a Certificate of Deposit (CD) to use as collateral against what you are borrowing.
- 3). You will need to put money into the savings account or CD. Some financial institutions (banks or credit unions) will have a minimum of $500.00 to be able to obtain a secured loan.
- 4). Once you have your Savings account or CD, you will be able to borrow an amount equal to the balance in your savings account or CD.
- 5). Most financial institutions will have a lower rate available the higher the balance is in your savings account or CD.