MoneyLion Credit Builder Review

moneylion credit builder review

As someone who was once in need of a credit boost, I’ve put in the time researching and trying out credit-building solutions. I found that options such as the MoneyLion credit builder are much more reliable and safe compared to other avenues, including paying a credit repair service company. 

This MoneyLion credit builder review will examine the program’s features, benefits, and possible answers to your credit concerns. 

Quick Summary 

The MoneyLion credit builder won’t only help improve your credit score, but it also advises you on improving your spending and saving habits so you grow your financial wellness.

However, that’s not to say MoneyLion is 100% perfect for every type of individual. Understanding the program’s more refined details and required fees will help you make the right choice in deciding if this credit score solution is right for your finances.

About MoneyLion Credit Builder

moneylion

MoneyLion’s credit builder assists individuals with optimizing their money management habits while building their credit with time. But how exactly does it achieve this? 

MoneyLion offers customers a credit-builder loan of up to $1,000, with the amount you receive depending on certain factors such as your current credit score and credit history. This loan stands out from other digital banks because MoneyLion allows customers to receive a portion of the loan upfront, with the rest going into a Credit Reserve Account. 

I personally love this idea because MoneyLion is helping set you up for financial success. You have 12 months to pay off the remainder of the loan in your account, during which time MoneyLion helps you make smart financial decisions (make payments on time, set up your budget, give you credit tips, etc.). After you pay it off, you receive the rest of the loan to spend how you like.

In the end, you get the money and the chance to build a vastly improved credit score. It’s a big financial win-win! 

What Are the Benefits of a MoneyLion Credit Builder?

There are many benefits to using the MoneyLion credit builder, with the biggest including:

  • Doing the hard work for you by reporting payments to the three major credit bureaus
  • Allowing you to monitor your credit progress
  • Sending you credit insights directly to your inbox
  • Use of a competitive mobile app
  • An abundance of extra membership perks 

Pros and Cons

All digital-only banks have their pros and cons, and MoneyLion is no exception. Here are the most important ones to consider: 

Pros

  • No credit check
  • Create an account for free
  • Automatic payments
  • Credit score checks 
  • Cash advances of up to $300 per pay period

Cons

  • Small loan amount
  • No physical branches
  • High membership fee 

How to Sign Up for MoneyLion 

So the next question becomes how to sign up for this credit builder service. Fortunately, the process is quick and easy and done through the MoneyLion app, which is downloadable from the Apple and Google app stores.

To qualify for a credit builder loan, you need to apply for the Credit Builder Plus membership. 

There are four requirements you must meet to apply for the Credit Builder Plus program:

  1. Be 18 years old or older.
  2. Be either a U.S. citizen or permanent resident
  3. Have a Social Security number
  4. Have a bank account, debit card, or another prepaid card

If you meet these requirements, you simply enter some essential information, including your name, contact information, address, and information about your verifiable checking account on the application in the MoneyLion app. 

MoneyLion then performs a soft credit check that will not affect your credit score. During this step, MoneyLion examines your financial situation. You’ll be notified soon after whether you are accepted. 

After this, MoneyLion splits up your loan into a sum you receive right away and a sum held in your Credit Reserve account. You also begin paying a membership fee of $19.99 per month, but MoneyLion only charges you the fee after your paycheck arrives. That way, you only are charged when you have funds in your account.

Features

There are several key features that make the MoneyLion credit builder one of the top credit building apps in the game. 

Lion’s Share Loyalty Program

MoneyLion’s loyalty program is one of the Credit Builder Plus membership’s best extra features. All members are automatically enrolled and have the opportunity to earn a monthly payment reward.

To have complete access to the Loyalty Program, you also need to sign up for MoneyLion’s RoarMoney mobile banking account and Investment account. Signing up for these services is also quick and easy and can be done entirely through the MoneyLion app.

Once you’re ultimately signed up, you can earn rewards based on your engagement with MoneyLion’s services. The number of log-ins to the system and the number of purchases you make each month determine your payout, which can reach up to $19.99 per month. This reward alone can cover the cost of the membership fee.

Credit Monitoring

Another top feature is the credit builder’s credit monitoring. This feature is especially useful for those who are just starting out building their credit. I could have used monitoring and progress-tracking when I was first starting my credit journey!

Besides monthly credit reporting, you also have access to a credit monitoring dashboard on your MoneyLion app. Here, you can check your credit score and age, payment history, and a review of how you use your credit. 

The Financial Heartbeat

Along the lines of credit monitoring, you can also use the MoneyLion app’s Financial Heartbeat feature. This is a one-of-a-kind mobile feature that tracks your financial health and wellness, much like apps that track your heartbeat or diet. 

The Financial Heartbeat monitors four key areas: your savings, spending, credit, and even debt. Every time you check on your “financial heartbeat,” you get a score from 1-10 that lets you know how you’re doing financially. This handy tool is especially great for keeping you on your toes with your credit health every single day. You also see how your credit affects all other financial aspects of your life. 

Cash Advances with Instacash

As a Credit Builder Plus member, you are eligible to receive up to a $300 cash advance to help you pay for those unexpected expenses. MoneyLion’s Instacash service handles this process. You apply for the service on the MoneyLion app and qualify if you meet the checking account requirements.

Even better, the cash advance comes with no interest and doesn’t hurt your credit. It’s another way to make payments safely and smartly without having to worry about racking up more debt. 

How Do I Build My Credit Score With MoneyLion?

You might be wondering how the MoneyLion credit builder helps you build a good credit score. It all comes down to making monthly, on-time payments. After all, payment history makes up 35% of your total credit score. 

Making credit payments on time shows lenders that you are a reliable borrower. You also have a higher chance of getting a loan for such things as a house, car, or college down the road. 

When you sign up for the Credit Builder Plus membership, MoneyLion asks you about your payday, including how often you get paid. You input the answer, whether it’s weekly, bi-weekly, or monthly, and the service sets up a payment date to coincide with when you have funds in your account.

You then set up an automatic loan repayment, meaning MoneyLion automatically withdraws the correct amount for your monthly loan payment from your account. After 12 months, you get the money leftover in your loan and a higher credit score if you made your payments on time.

Alternatives

Of course, there are other challenger banks out there besides MoneyLion. It’s worth looking into the most popular alternatives to ensure you do what’s best for you financially. Here are some of the most commonly used credit builders by others:

Chime Credit Builder Card 

The Chime Credit Builder Card is perhaps one of the biggest competitors to MoneyLion. To qualify for the card, you have to open a Chime Spending Account. You move money from here to your Credit Builder Card. The money on the card is how much you can spend, so there are no limits, interests, or fees. 

Chime reports your payment history to the three major credit bureaus, much like MoneyLion. Chime also offers great deals regarding fees, as there are no annual costs or interest, no credit check to apply, and no minimum security deposit required. All establishments, agencies, and organizations that accept Visa also accept Chime, making it easy to use throughout the country.

Varo Believe Card

varo money

Varo is a big hit in the mobile banking scene in general and another practical alternative to MoneyLion. With Varo, you build credit with the Varo Believe Card. Every time you make a purchase with the card, money is set aside from your bank account to ensure payment when it’s due each month. Varo reports your payments to the three major credit bureaus. 

Varo is especially attractive to many people because of the lack of security deposit, no monthly fees, and no annual percentage rate. The fact that Varo doesn’t charge a high subscription fee like MoneyLion might make it a good choice for you if you’d rather avoid another monthly subscription service. 

The Bottom Line 

Developing good credit can lead to higher-quality loans. Unfortunately, it can be difficult to build credit if you don’t have any or find yourself with a poor score. I have experienced this myself when financial institutions and other businesses turned me down for loans because of my previous so-so credit score.

Luckily, the MoneyLion credit builder offers an easy-to-use and efficient way to build up your credit and receive optimal rewards. The service stands out for its motivational model: develop good credit and receive a monetary reward at the end.

Of course, that doesn’t mean MoneyLion is the end-all solution for you. You have to make sure you make payments on time and optimize your money management along the way. However, MoneyLion can be an excellent way to begin that journey.