Credit Union car loans for non-members

cantdecide

I'm trying to get a few grand together to upgrade the car. I have some cash and I'm looking to borrow about €2500 to get a €4250 car.

Is it possible to join and simply apply for a car loan without any of the usual Credit Union strings? It seems so from what they say at the bottom of this page here...

I have always banked with PTSB and I've had various loans and a credit card with them but never for major money and not any time recently. I was in and out of work for the last few years (construction) but not I have a full time permanent admin job in a contact centre for very modest money since last September. I'm not confident I'd get a loan from them.

Spocker

Nope, you can't. You'll need to be a member of the credit union, and theres usually a waiting period - some CUs are as low as 6 weeks, but most are generally 13 weeks, before you can take out a loan.

cantdecide

Thanks for that. At least now I know.

Okay, I'm thinking of changing tack on the whole thing - I think I'll wait until the new year to upgrade. It would give me time to get established with the CU and maybe get some savings together to lower the the principle.... which leads to more questions.

Firstly, I'm very confused about how to utilise both banks and CU's without incurring all kinds of fees, hassle and also hindering record keeping from the point of mortgages. I'm hoping to try and get a mortgage in a few years and I'm worried about committing some schoolboy error by mis-using the institutions.

I don't earn a lot at the moment but I work full time. I'm worried about incurring excessive fees if I'm drawing and transferring small amounts of money all over the place.

Can I set up a standing order from my current account? If I get a loan, can I set up a direct debit for repayments? I have it in my head that I have to do everything analog but don't know if this is true.

I've been saving around €300/mth with my bank toward course fees in September in which case it will all be paid out. Because it's spoken for, is there any point in transferring it to the CU prior to September? I will start saving €200/mth for the following year's fees thereafter. Should I carry on with the bank for my course fees?

If I wanted to borrow €2,500 in the new year, how much would I need to be saving with the CU from now on?

Spocker

You indeed better off establishing your record with the CU first, it'll greatly improve your chances of getting the loan. Just remember any savings you put there will be held as collateral for the duration of the loan, once you draw it down.

I wouldn't worry so much about the fees - if you're transferring via standing order there will just be the fee on the banks side, there are generally no feeds for the CU transactions. If you do get the loan, the it'll be a standing order you'll setup for the repayments too (there aren't many CUs setup for Direct Debits)

Stick with the bank for your fees, as you know you'll be withdrawing all those funds at some point. For a CU a savings record is better than saving-then-withdrawing-all-the-time.

Each CU has different rates for their loans. Using the sample one here: http://www.stcanicescu.ie/loan-calculator/

Assuming you takeout the loan for €2,500 for 1 year, your weekly repayments would be around €50; so saving anything close to that a week would be good. I can't give any more specific amounts, it's really down to your own circumstances what you can afford.

When you do apply, bank statements and payslips will be required, and the Loan Officer will share some calculations on your debt-to-income ratio, to see if you can really afford the loan or not - the three key words here are "ability to repay"