Credit Union, should I join one?

rachaelfleur

I've been reading up on Credit Union's lately and I'm getting mixed views on them. Can anyone advise me on whether I should join or not?

The main reason I want to join, is to start saving and also pay off a few of my smaller debts I have. I stupidly took a pay day loan from paydayuk and now can't get out of a viscious cycle where I have to get one every month. I borrow £400 every month and pay back £475 every month, so I'm wasting £75 every month and this has been going on for almost a year now. I read about credit union loans and thought it would be a good way to get rid of my payday loan. Any advise on this matter would be a huge help to me.

Thanks

beanielou

Hi & welcome
i personally am a great credit union fan
You save a wee bit every week/month & then you can borrow about 3 times what you have saved.
I think this could really help you to get rid of your pay day loan.
Keep posting:)

beanielou

You could also pop up your SOA to see if we can advise you on that.

rachaelfleur

Great, thanks for telling me that, I feel a bit better now.

I have quite an extensive SOA so I'll get all the info together and post it. I really do need help

beanielou

Look forward to seeing your SOA.

KellyWelly

I'm a big fan of credit unions (and co-operatives in general). They keep money local instead of sending it abroad where it has no benefit to your local community and they loan smaller amounts of money to people who need it which they wouldn't be able to get from a bank and might otherwise end up borrowing from somewhere like Provident or your local trusty loan-shark. I also like the way a % of your repayment goes into a savings account for you so it helps people to save and budget and not need further borrowing at the end of the term.

claudiac_2

I agree with KellyWelly, Credit Unions are a good thing, especially in todays financial mess. I have just joined Glasgow Credit Union, and also applied for a current account with them. Mainly because of my bad credit rating but also get away from the big banks as I don't really trust them.

rachaelfleur

Thanks to everyone, I really feel like I'm finally making progress and I haven't even joined yet! I'll get my application sorted tomorrow.

Just a quick question about my SOA, how much info do I need to include? Obviously all my incomings and outgoings, but will I need the balance left to pay on loans and apr's?

beanielou

Yes, u need balances & APR's.
HTH

rachaelfleur

Ok I'll get all that together, probably be tomorrow before I can post it though.

rachaelfleur

Ok so here's my state of affairs. I'm not sure if I've done it correctly though because I do have money to live on, just not much. Although I don't live with my partner he does help me out quite alot with food, gas and electric. I guess you'll all be wondering why I have so much debt, well the majority of it was during my student days, I only graduated 2 years ago. I also have a student loan of over 21,000 but I don't include that as a debt at the moment. Payments for this are automatically taken from my wage every month and it's set at 9% so everytime my wage goes up, the payments go up. A couple of things I really don't and can't give up are my car as I work out of town with the worst transport links ever and I have a carpool rota with other people also and the other is my gym membership, it's the only luxury I have and I do alot of running events to raise money for charity. I'm currently training for the Great North Run and raising money for Beating Bowel Cancer.

Anyway here it goes:

Household Information
Number of adults in household - 1
Number of children in household - 0
Number of cars owned - 1

Monthly Income Details
Monthly income after tax - 1689
Partners monthly income after tax - 0
Benefits - 0
Other income - 0
Total monthly income - 1689

Monthly Expense Details
Mortgage - 0
Secured loan repayments - 0
Hire Purchase (HP) repayments - 200
Rent - 240 (currently £240 in arrears)
Management charge - 0
Council tax - 110 (currently £220 in arrears)
Electricity - 40 (both gas & electric can vary as shared with partner, I have pre pay meters installed)
Gas - 40
Oil - 0
Water rates - 0 (This is included in council tax)
Telephone (land line) - 40 (combined sky/phone/broadband)
Mobile phone - 20 (fixed)
TV Licence - 0 (father pays for this)
Satellite/Cable TV - 0 (combined package)
Internet Services - 0 (combined package)
Groceries etc - 200 (this can vary as shared with partner)
Clothing - 0 (buy and sell on ebay)
Petrol/diesel - 60
Road tax - 10
Car Insurance - 41 (up for renewal in march)
Car maintenance - 0 (car not 3 years old yet)
Car parking - 0
Other travel - 0
Childcare/nursery - 0
Other child related expenses - 0
Medical - 15 (Dental Insurance)
Pet insurance/vet bills - 0
Buildings insurance - 0
Contents insurance - 6
Life assurance - 0
Other insurance - 7 (sky repair plan)
Presents - 0
Haircuts - 60 (every 3 months)
Entertainment - 26 (gym membership)
Holiday - 0
Emergency fund - 0
Total monthly expenses - 1055

Assets
Cash - 0
House value (Gross) - 0
Shares and bonds - 0
Car(s) - 5000
Other assets - 0
Total Assets - 5000

Secured & HP Debts
Mortgage - 0
Hire Purchase (HP) - debt 6714 payments 178 @ 24% apr
Hire Purchase top up - debt 726 payments 22 @ 28% apr
Total secured & HP debts - 7440

Unsecured Debts
Barclay cc - debt 259.94 min payment 5 @ 24.9% apr
Vanquis cc - debt 531.11 min paymant 25 @ 39% apr (credit limit 500 so OD)
Capital One cc - debt 203.12 min payment 20 @ 25.9% (defaulted on this, reclaimed £525 in charges but still have a balance to pay)
HFCS - debt 503 min payments 250 @ 0% apr (DFSsofa only 2 payments left)
Lloyds TSB OD - 392 min payment 50 @ 0% apr (free as it is student account)
RBS OD - debt 2065.20 payment 20 @ 0% apr (this should be free however I'm currently over my limit of 1700 so accruing charges so debt is escalating)
PaydayUK - debt 525 min payment 525 (I'm not sure of apr but it's very high. I have to apply a loan of £400 every month to make ends meet and pay back 525, crazy I know)
Welcome Finance loan - debt 8274.42 min payment 197 @ 59.05% apr
Citifinancial loan - debt 9247.88 min paymant 239.40 @ 45.3% apr
Total unsecured debts - debt 22001.67 payments 1331.4

Monthly Budget Summary
Total monthly income - 1,689
Expenses (including HP & secured debts) - 1,055
Available for debt repayments - 634
Monthly UNsecured debt repayments - 1,331.4
Amount short for making debt repayments - 697.4
Personal Balance Sheet Summary
Total assets (things you own) - 5,000
Total HP & Secured debt - 7,440
Total Unsecured debt - 22,001.67
Net Assets - -17,727.67

Created using the SOA calculator at www.makesenseofcards.com.
Reproduced on Moneysavingexpert with permission, using IE browser.