credit union loan

Ita 259

We purchased an old house 18 month's ago to renovate. We bought it with our savings and hoped we'd still have enough to complete work without having to borrow. We moved in with my parents to save us money also. Now 18 months later it's not nearly ready, we're down to the last 5k and with 4 kids, my parents just want their house back! We got turned down for bank loan even though my dad, who owns his own business, said he'd go guarantor. They said no as we only have 1 income. So I was wondering about the credit union. Do they lend large amounts like 40/50k over 10yrs??? I have a good credit rating with them having paid back small loans over the past 15 years and my dad would again go guarantor. Has anybody ever done this? We have an income of €600 a week plus €540 a month child benefit. We owe about 10k for a car loan. Thanks for reading!!

jathclare

It can vary from CU to CU, I am member of a rural CU and have taken similar sized loans for similar purposes over the years. Its a great way to bank.

They would expect:

-Savings history with CU demonstrating affordability
-Savings to loan ration of 4:1 (3:1 is not uncommon)
-maximum €40K and 5 year limits
-Proof of income, other loans etc

They will top up loans for members in good standing, i.e. an initial 10k loan could be increased providing repayments are met and loan to saving is maintained.

I believe a small % of loans can be 10 years, but the other limits remain. A savings and relationship with them over a long period can be a major factor in getting a loan this size. Some CUs will accept guarantors as well, particularly if they are members.

However, expect interest of up to 12%......a €40k/5 year loan would have repayments of €900 a month or more so it would be similar to a mortgage.

Perhaps, since you have an asset already it might be better to speak to a broker with self build knowledge and re-apply for a mortgage instead.

phormium

Depends on the CU, the bigger ones certainly do. You can apply for a secured loan which will be secured against the house, similar to a mortgage so the rate will be not the normal higher unsecured rate.

Assuming you qualify income wise etc it is certainly possible.