Credit Unions: Official MoneySavingExpert.com Discussion

Sandra46

Do you know how it works if u pay back loan early do u still pay full amount for example borrow 200 pay 10 for 25 weeks is 250 but if pay it of in 20 months do I still pay 250

27col

Sandra46 wrote: »

Do you know how it works if u pay back loan early do u still pay full amount for example borrow 200 pay 10 for 25 weeks is 250 but if pay it of in 20 months do I still pay 250

Why don't you just ask them. They're the ones who know.

Looneytunes8

The London Community Credit Union were partnered with the Co Op until earlier this month when they started a new partnership with Natwest. It's now a shambles with customers receiving temporary cards that they have to top up and get charged at every ATM for withdrawals. The online account is messed up badly and customers can't check their balance online or at the ATMs as it blocks the card so it's only for withdrawing cash. This is for a whole 6 months. This is ridiculous. :mad:
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Anthorn

Looneytunes8 wrote: »

The London Community Credit Union were partnered with the Co Op until earlier this month when they started a new partnership with Natwest. It's now a shambles with customers receiving temporary cards that they have to top up and get charged at every ATM for withdrawals. The online account is messed up badly and customers can't check their balance online or at the ATMs as it blocks the card so it's only for withdrawing cash. This is for a whole 6 months. This is ridiculous. :mad:
Chat conversation end

Take a look at my avatar: It's the Credit Union prepaid card which is issued by the Association of British Credit Unions Ltd. Actually intended for those who don't have or don't want a bank account and like most prepaid cards has fees associated with it.

It's not at all unusual for Credit Unions to partner with a financial institution and equally not unusual for that partner to be Co-operative Bank. But in the light of Co-operative Bank's recent history it's not really surprising that CUs are moving away. For example the Credit Union I'm a member of is partnered with Barclays Bank and in some areas even operates a CU branch inside a Barclays Bank branch.

Lastly do you have a link which supports your post? I did Google it but can't find anything which supports your post. It's just that I'm highly interested in and follow news about credit unions.

SparklesJD

Sandra46 wrote: »

Do you know how it works if u pay back loan early do u still pay full amount for example borrow 200 pay 10 for 25 weeks is 250 but if pay it of in 20 months do I still pay 250

Bit late for Sandra, but in case it's useful for anyone else...

Most credit union loans are fixed-term loans, i.e. your interest is calculated at the start of the loan and added on to your loan amount, then divided over the term (length) of the loan. I say 'most' because some CUs now offer revolving credit facilities.

CUs do not charge for early repayment or for overpayment of loans, whether regular or occasional. Interest is charged daily on the reducing balance. This means that overpaying will reduce the amount of interest that you pay on the loan overall.

To use Sandra's example, if you want to clear it at month 20, the CU will be able to tell you how much is left to clear at that point. You will have paid the interest that was due already (each month's repayment will have been x amount capital and y interest) so there won't be anything else to pay above that figure.

If you have been paying extra each month, it is likely that your final month's payment will be much less or that the loan will finish early.

Bear in mind that early repayment is one thing, but they are not generally-speaking a source of very short-term credit (with one or two notable exceptions).

SparklesJD

Anthorn wrote: »

It's not at all unusual for Credit Unions to partner with a financial institution and equally not unusual for that partner to be Co-operative Bank. But in the light of Co-operative Bank's recent history it's not really surprising that CUs are moving away. For example the Credit Union I'm a member of is partnered with Barclays Bank and in some areas even operates a CU branch inside a Barclays Bank branch.

To add to Anthorn's point... CUs are not clearing banks. Transactional banking for the Credit Union Current Account (CUCA) was done through an 'agency bank', specifically the Co-op.

Unfortunately, in recent times, the Co-op Bank have decided that they do not wish to support the CUCA and so all CUs offering it have had to make alternative arrangements.

I do not wish to speak for London Community CU, but they do have a page on their website about this: http://www.londoncu.com/accounts/current-account/cucachanges/

JasWil

I have a credit union account and I put in £10 a month. This is a small part of my savings. I like the credit union but there are a number of problems.

1. No internet or telephone banking.
2. It is policy that they will not send anything through the post including statements to avoid identity fraud.
3. I have to go into the branch to check on my money.
4. The website is not updated in years.
5. They don't respond to emails.

mary_delahunty

Hello

Are Credit Unions covered by the Consumer Credit Act ?
Is there a rule that triggers the CCA provisions ie if the rate of interest being charged on a loan from the credit union is above 26.9% ?

[Deleted User]

mary_delahunty wrote: »

Are Credit Unions covered by the Consumer Credit Act ?
Is there a rule that triggers the CCA provisions ie if the rate of interest being charged on a loan from the credit union is above 26.9% ?

https://www.fca.org.uk/firms/credit-unions/consumer-credit

Bosie

My local credit union is down in Sussex and for a loan up to £1000 they charge 42.6% Apr. I think that's a lot, also if you are 65 years of age, you have to be a member for 3 years to apply for a loan.