Credit Unions offering loans at just 1%

lswwong

Candy

As I recall, Martin and his team would love to do a feature on credit unions as a self-helping, low cost finance resource. Sadly, I understand the team has their hands full on all sorts of things too and are struggling to fit it in.

It would be terrific if you could get in touch with the MSE team to let them know of your first hand experience.

The MSE community would benefit from knowing more about credit unions.

(Alas, I have no first hand experience of them but understand they can be very effective in helping people who are otherwise excluded from mainstream credit.)

Best regards,

Louise

sleepymans

Hi
I have had a credit union account for several years and have had a series of loans which have been of great help to me.
However my small regular savings mounted up to a tidy sum - nearly £2k and they had no paid any interest (or dividend whatever they call it) for 2 years. My last loan which was for £700 was being charged at about 12%. I suddenly woke up when I received a statement where they had not only not paid me anything on my savings but had charged me (ok, only a couple of £) an "admin fee". When I enquired if this was right they said it was the affiliation fee to the national body which gave me "financial protection".

Well that might be but to charge 12% on loans, give no interest on savings and then charge an admin fee has been the last straw for me.
I have now decided to pay off the loan from my savings, withdraw £500 to set up a Lloyds tsb regular saver account at 8% gross interest and have my regular savings paid into that instead.

I was previously a great supporter of credit unions and took out the loan to be community minded but I feel it has cost me dear. I'm lucky that I was in a position to open a Lloyds tsb account - I feel sorry for those that can only use the credit union.