The credit union aims to ensure that you have maximum control over your borrowing:
... There are no hidden charges;
... You the borrower decides how much you repay and the length (within legal limits) of your repayment period;
... You will know the interest rate at which you are repaying and how much total interest you will pay if you pay according to your agreement;
... You will not be persuaded to pay for additional insurance or arrangement fees;
... There is no penalty/additional cost if you choose to repay your loan early;
... Subject to certain conditions the credit union meets the cost of insuring your loan against untimely death, so no-one will inherit the debt.
Conditions of Borrowing
... Generally members may apply for a loan three months after opening an account, and making regular savings throughout that time.
... Only members over the age of 18 are eligible to borrow.
... An applicant should complete a simple application form and submit the form with proof of income and expenditure to a worker at any of the offices or collection points, to be passed on to the loan committee for a decision.
... Small loans of £500 or under may be agreed within a day; larger loans up to a maximum of 10 days.
... Loan applications are assessed on the basis of criteria that include regularity of savings, value of savings, length of membership, previous loan repayment, and ability to repay.
... The loan committee is elected by the membership at the AGM and its decisions cannot be overturned. However an applicant can ask for the reason for a refusal and submit a fresh application.
Types of Loans
Loans secured by savings:
... Such loans require a level of savings and regularity of savings.
... Applications may be made for up to double the value of the savings where a member has held an account for up to 2 years.
... Applications may be made for up to triple the value of savings where a member has held an account for 2 years and more.
... The maximum loan cannot be more than the value of savings plus £5000.
... Interest on all loans is 1.5% a month or 19.5% APR
Loans of up to £300 granted on basis of payments of wages, tax credits and/or benefits into the member’s account. No specific savings balance required but the member must have made regular transactions over a minimum period of 3 months.
Problems repaying your loan
... Loan interest is the major source of income for the credit union, and is crucial to the continuing growth of the credit union. Loans are funded by the savings of all the members collectively, and the credit union has a responsibility to protect those savings.
... So the repayment of loans is of great importance to all of us.
... At the same time the credit union will do all it can to assist if members have difficulties with their repayments.
... If you have a change in your circumstances – contact us; if you lose work or have a reduction in your income for any reason let us know and we will come to alternative arrangements.
... But please don’t bury your head in the sand – we are here to help.
224-226 St Vincent Street West
Birmingham B16 8RP