Paying off CU loan with CU shares

W

wired89

Registered User
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Credit Union Shares: €2615
Credit Union Loan: €5507

I've just been on to my credit union, I wanted to pay a lump off my loan using the balance of my shares. I was told that I cannot do this as my shares are used as security against the loan. I've been paying off the loan regularly with bi-monthly direct debits from my bank for over three years now (a couple of top-ups along the way). I want to get the loan paid off as soon as possible and thought this would be the best way to do it, but the CU won't allow it.

Is this standard practice for all credit unions, and if not where should I go from here?
 
I have discussed that in this thread.

you have to keep 25% of 5507 or €1376.

I think that they should allow you to reduce your shares to this.

You could get around it by going to another bank or Credit Union and asking them for a loan for €5507. Pay off the Credit Union. Withdraw your shares. pay the shares off the new loan.

Brendan
 
Thanks Brendan.

The credit union said I could only used shares to pay off the loan when my loan balace was less than or equal to my share balance, they never mentioned the 25% rule. They did however allow me to pay off $300 with my shares because I had topped up the loan by €1000 a few months ago.

But if I use the 25% rule shouldn't I be allowed to pay off €1376 of the loan with shares

5507 * 0.25 = 1376.30

2615 - 1376 = 1239 < new share balance
5507 - 1376 = 4131 < new loan balance

edit: an additonal loan probably not an option at the moment
 
Wired 89 your new share balance should be 1376.75 which is 25% of the loan value. Thus you should be able to take 1238.25 off your loan leaving your loan balance at 4268.75
 
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