I am writing to inform you of important service improvements and great value for members here at xxxx Credit Union .
SECURED SAVINGS LOAN
Don't withdraw your hard-earned shares without looking at all your options!
It is sound financial practice to build up a rainy-day fund, or to save over time for important purchases. And the promotion of such sensible behaviour is a fundamental principle behind credit unions. There are many good reasons not to simply withdraw your savings when you need the money, but to opt for our SECURED SAVINGS LOAN instead.
How much will it cost me?
The special low interest rate of only 6.5% (6.7%APR) is fantastic value, with a Loan of €3,000 having repayments of just €21.23 a week over 3 years and the Total Interest Paid is only €312.41.
For more information on these loans, simply call in to any of our 4 offices locally, or call us on 01 xxxx to discuss it with a member of our Lending team. When collecting a loan, please bring current Photographic Identification with you.
Insurance Benefits
One of the key advantages is that you maximise your FREE Savings and Loan Insurance benefits by taking a loan rather than withdrawing your shares. This will clear your loan and pay-out up to twice your shares to your next-of-kin in the event of death (subject to qualification) .
Other Benefi t s
• Secured Savings Loans can be drawn down on demand* at any of our offices, we can even transfer the funds directly into a bank account for your convenience.
• The extremely low interest rate of only 6.5% (6.7%APR).
• Your savings continue to earn an annual Dividend.
• If you wish to clear the Loan, it can be done at any time from your Shares without incurring any penalties or'extra charges.
• No transaction fees or hidden charges
*Subject to normal underwriting Terms & Conditions
It is sound financial practice to build up a rainy-day fund
Or maybe the CU should deal with the members personal circumstances and suggest or offer the best thing for them.
In regards to your insurance comment, I meant the loss of insurance to the member(many of whom have no insurance at all) and not the cost to the Credit Union.
....The CU should unbundle the insurance and charge separately for it.
It is never in a borrower's interest to leave money on deposit at 1% while paying 6.5% on the loan.
They should put their deposit elsewhere, so they can access it whenever they want.
If you have your deposits elsewhere e.g. a bank deposit account, it's unlikely that you'll get any loan whatsoever from the CU no??
At a minimum, I'd expect a CU to have their members interests at heart, and to be very explicit about the cost of borrowing over the cost of withdrawal of savings.- borrowing wile you have savings may make sense, although it comes with a cost.
- CU loans secured against savings are exploiting members naivety
According to the local CU all loans are secured on the shares. And they charge no where near 6%. 1% per month is the tariff round these parts.
According to the local CU all loans are secured on the shares. And they charge no where near 6%. 1% per month is the tariff round these parts.
The whole idea of the Credit Union was to borrow and save at the same time.
While this is correct mathematically, there is often more involved.
For many people getting the money together to pay for an unexpected expense is serious worry.
A person in this position who has some money saved, may want to pay for a holiday. If they use their savings for the holiday, and the next day their car dies they are in trouble.
Wouldn't it be better to change people's habits to minimise the interest that they pay, so they are better off in the long term?Absolutely Cremeegg, there is a lot more involved than maths on this. It's about a concept and a way of managing money precisely so that people understand it's important to pay off loans but also to save. It also changes people's habits.
Sorry, but you really didn't answer my question. Yes, I fully agree that money management is a serious social issue, and that the action of the payday lenders is dispicable.@RainyDay why? Because prior to credit unions a lot of people used money lenders. Even look at the UK and payday lenders have charged up to 4,000% APR.
Money (mis)management is a serious social issue.
By getting into the habit of saving - you reduce your need to borrow.
Which one - there is a .Have a look at the WCCU website.
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