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Credit Union Dividends

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  • 08-07-2008 4:28pm
    #1
    Par72
    Registered Users Posts: 640 ✭✭✭


    What type of dividend (interest) can you typically expect from savings in a credit union? Is the only advantage of saving with a credit union that you can get low interest loans with them?

    Thanks


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    #2
    dobsdave
    Closed Accounts Posts: 1,814 ✭✭✭dobsdave


    Dividends are quite low compared to equivalent interest rates on offer in the banks.
    Loans aren't particularly low interest rates, 10.2% in my local CU.
    It is easier to get a loan from them usually, which is one of the reasons they are popular.


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    #3
    shockwave
    Registered Users Posts: 1,770 ✭✭✭shockwave


    My interest is usually 3%


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    #4
    dotsman
    Registered Users Posts: 3,636 ✭✭✭dotsman


    Credit Unions have been having a hard time of it in recent years. Their interest rates are inferior to the main banks and don't provide easy access (ie e-banking). Their loan rates are also not the best. The only advantage is that they are usually good to offer small loans to people on low/irregular income that the banks might turn down.

    Oh, and as for rates (both savings and loans), I think they differ between individual Credit Unions, so I'm only referring to "on average" above.


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    #5
    Davy
    Registered Users Posts: 19,340 CMod ✭✭✭✭Davy


    dotsman wrote: »
    Their interest rates are inferior to the main banks and don't provide easy access (ie e-banking).
    The interest rates are generally around 3% that i have seen, and 2 of the 3 credit unions i have dealt with have online services!
    dotsman wrote: »
    Their loan rates are also not the best.
    Last loan from them was 6.5%
    dotsman wrote: »
    Oh, and as for rates (both savings and loans), I think they differ between individual Credit Unions
    Yes they do, each sets their own


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    #6
    dotsman
    Registered Users Posts: 3,636 ✭✭✭dotsman


    davton wrote: »
    The interest rates are generally around 3% that i have seen, and 2 of the 3 credit unions i have dealt with have online services!
    Pretty poor rate at the moment (min you should expect from your bank is 5%, with 7%+ on special savings accounts). Didn't know that about the online services. Are they any good (transferring funds, paying bills, standing orders, international transfer etc)?
    davton wrote: »
    Last loan from them was 6.5%
    That's a pretty good rate! Did you have to leave money on deposit with them to get that though?
    davton wrote: »
    Yes they do, each sets their own
    Always wondered about this. Do you have to live in the locality to use a credit union. ie, if word got out that a credit union in Meath was doing dirt cheap loans, could anyone go and sign up, or is it just for the locals?


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    #7
    Xoote
    Closed Accounts Posts: 3 ✭Xoote


    Thanks for the info.


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    #8
    Davy
    Registered Users Posts: 19,340 CMod ✭✭✭✭Davy


    dotsman wrote: »
    Pretty poor rate at the moment (min you should expect from your bank is 5%, with 7%+ on special savings accounts).
    yes,never gonna be as strong, but never as much conditions or charges
    dotsman wrote: »
    Didn't know that about the online services. Are they any good (transferring funds, paying bills, standing orders, international transfer etc)?
    You can check account balances, transfer funds and more. You can pay bills online if you sign up for Online Bill payment services where available.
    dotsman wrote: »
    That's a pretty good rate! Did you have to leave money on deposit with them to get that though?
    No, i think it was an offer at teh time, i think normally around the 7%, 7.2% mark
    dotsman wrote: »
    Always wondered about this. Do you have to live in the locality to use a credit union. ie, if word got out that a credit union in Meath was doing dirt cheap loans, could anyone go and sign up, or is it just for the locals?

    I think they differ on each co-ops terms but not 100% on this. I seen the phrase 'common bond' as in you have to live in the locality, or work for an associated company or live with someone that is a member etc


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    #9
    Par72
    Registered Users Posts: 640 ✭✭✭Par72


    dotsman wrote: »
    The only advantage is that they are usually good to offer small loans to people on low/irregular income that the banks might turn down.

    Thanks dotsman.
    So no real incentive to save with them then unless you're looking for a small loan with a poor income?


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    #10
    dotsman
    Registered Users Posts: 3,636 ✭✭✭dotsman


    Par72 wrote: »
    Thanks dotsman.
    So no real incentive to save with them then unless you're looking for a small loan with a poor income?

    That's always been my take on them. If it's savings only, then you will get a better rate from the mainstream banks (this use not be the way, and I think the Credit Unions are still doing a lot of business based on past reputations of giving high dividends).

    I remember reading several times in the past year or 2 about how most of the credit unions had too much money, and little demand for their loans, thus realising small profits, hence small dividends. That might all change over the next few years if the economy goes downhill:(


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