Questions about Credit Union loans

Clem H Fandango

Just have a quick query on CU Loans,

I took out an 8k loan on 3k savings about 2 years ago and have now chipped away at it so my loan total now is pretty much equal to my savings total.

Do credit unions allow members to use their savings to clear the loan?
Im also planning to close my account too as i’m moving to the UK very soon.

Just wanted to ask before I try and book an appointment at my local cu office.

Thanks.

2Mad2BeMad

Clem H Fandango wrote: »

Just have a quick query on CU Loans,

I took out an 8k loan on 3k savings about 2 years ago and have now chipped away at it so my loan total now is pretty much equal to my savings total.

Do credit unions allow members to use their savings to clear the loan?
Im also planning to close my account too as i’m moving to the UK very soon.

Just wanted to ask before I try and book an appointment at my local cu office.

Thanks.

Not sure but I'd be surprised if they said no.
Credit unions are very accommodating to people's situations and it's not like you don't have the money to pay it off.

I'd imagine it wouldn't be a problem using ur savings.

wally1990

2Mad2BeMad wrote: »

Not sure but I'd be surprised if they said no.
Credit unions are very accommodating to people's situations and it's not like you don't have the money to pay it off.

I'd imagine it wouldn't be a problem using ur savings.

Would you believe I had this issue

Basically I had 2k held against 10k

Got down to 2k on the loan and had still the 2k savings held against

I went in and said just clear that 2k held against it and bring it to 0.00

The woman wouldn't do it and kept repeating now it's held against it in the loan account and I keep having to pay the loan

Long story short, I got so pissed off I took a debit card and said take 2k off this card to clear the loan debt and then I asked what happens now with the 2k that was held..

She goes well now you can access /use it

Jesus Christ I was so annoyed for beating around the bush

That was bakers road cork

2Mad2BeMad

wally1990 wrote: »

Would you believe I had this issue

Basically I had 2k held against 10k

Got down to 2k on the loan and had still the 2k savings held against

I went in and said just clear that 2k held against it and bring it to 0.00

The woman wouldn't do it and kept repeating now it's held against it in the loan account and I keep having to pay the loan

Long story short, I got so pissed off I took a debit card and said take 2k off this card to clear the loan debt and then I asked what happens now with the 2k that was held..

She goes well now you can access /use it

Jesus Christ I was so annoyed for beating around the bush

That was bakers road cork

Wow you'd think common sense would prevail.
I guess they don't like seeing accounts go to zero.
But op no harm asking anyway all credit unions are different.

Trish56

Of course you can, just withdraw the 2k and pay off the loan balance.

Clem H Fandango

Trish56 wrote: »

Of course you can, just withdraw the 2k and pay off the loan balance.

Nah they dont let withdrawls with an outstanding loan balance, guess i’ll have to just book an appointment and see.

Saysay19

Years ago I was made redundant and I went to credit union and explained. They were very accommodating whereby they reduced my weekly loan payment.
When I got loan down to less than what was in my savings I asked could I clear it and they said it was no problem at all.
Defnitely ask!

howardmarks

I've done this. It's not common and they don't like it but if loan equals savings then it's net 0. I was moving abroad too

amcalester

Clem H Fandango wrote: »

Nah they dont let withdrawls with an outstanding loan balance, guess i’ll have to just book an appointment and see.

It really shouldn’t be a problem, my CU did it for me when I requested.

troyzer

It's not a problem. I recently became unemployed and my loan balance was smaller than my savings.

I asked could I restructure the loan but she told me not to because these technically count as arrears. She told me to clear it using savings.

notharrypotter

I have done this twice now. Never been an issue.

Zhane

I've done this too. Shouldn't be any issue.

My local CU is Drogheda, and there's never been any issue with this at all, from anyone I know. Once your loan is equal to, or lesser than your savings, you can use the savings to wipe the loan out.

That said - they generally advise against it as if you were to be killed, for example, your loan would be written off and your savings paid out to you, whereas if you obliterate both savings and loan, then get knocked down crossing the road, there's no money to pay out to you/your family/etc.

Canis Lupus

Deleted User wrote: »

My local CU is Drogheda, and there's never been any issue with this at all, from anyone I know. Once your loan is equal to, or lesser than your savings, you can use the savings to wipe the loan out.

That said - they generally advise against it as if you were to be killed, for example, your loan would be written off and your savings paid out to you, whereas if you obliterate both savings and loan, then get knocked down crossing the road, there's no money to pay out to you/your family/etc.

Way to jinx the OP......

gwalk

I,ve done this online with my CU,

The savings must be more than or exactly equal to the loan for it to work

I would recommend keeping your account open with about €20 or so in it while your away, handy to have proof of address from a financial institution if you are ever coming back

Clem H Fandango

Thanks everyone, phoned today and was told it wasn’t possible since I had missed 2 payments last year. Bit annoying tbh.

2Mad2BeMad

Clem H Fandango wrote: »

Thanks everyone, phoned today and was told it wasn’t possible since I had missed 2 payments last year. Bit annoying tbh.

Might sound stupid but can you take a loan out with ur bank pay off the cu loan then withdraw the funds and payoff the bank loan?
Most loans from banks let you pay off early without a fee.
I took out a loan of 1k before paid it back a week later with no fee or interest added on.

Or credit card or a family member loans you the money they would get it back straight away

Clem H Fandango

Clem H Fandango wrote: »

Thanks everyone, phoned today and was told it wasn’t possible since I had missed 2 payments last year. Bit annoying tbh.

Pardon my ignorance, but what does that have to do with it? Who cares if you missed payments? Unless they're saying that you actually owe more than you think because of accrued interest or something like that?

Trish56

That is total nonsense you owe 2k and you have 2k and you are entitled to transfer the savings to pay off the loan balance. I would recommend that you ask to speak to the manager and if he/she says no ask for it in writing and then advise that you are contacting the ombudsman/central bank. You are getting probably 0.25% interest rate on your 2k savings and probably paying 10% to 12% on the loan. You could also ask for a copy of your loan agreement.

Missing two payments in the last year is irrelevant. The big advantage that Credit Unions advertise for car loans etc. is that you can pay off without penalty.

Clem H Fandango wrote: »

Thanks everyone, phoned today and was told it wasn’t possible since I had missed 2 payments last year. Bit annoying tbh.

Spocker

Clem H Fandango wrote: »

...my loan total now is pretty much equal to my savings total.

This is what the OP actually said, along with missing a couple of payments.

Without the actual numbers, it's likely that the outstanding balance on the loan is slightly greater that the shares. If I were you OP I'd lodge enough to bring the shares up to the amount of the loan, and then ask to transfer the entire amount to clear.

As for missing the payments, the CU care for sure - what it actually means is that the CU have to put an ever increasing amount of reserve against the loan (known as Section 49) in case the lendee defaults, and that comes off the CUs bottom line (also known as 'dividends' or 'loan rebates')

Trish56

My daughter works in a fairly big Credit Union and I asked her and she said of course you can offset your savings to clear your loan. If you not getting anywhere with a teller some who are partime ask for the supervisor who will sort it for you.

As other posters mentioned you need to be able to clear the full loan.

Clem H Fandango wrote: »

Thanks everyone, phoned today and was told it wasn’t possible since I had missed 2 payments last year. Bit annoying tbh.

Clem H Fandango

Trish56 wrote: »

My daughter works in a fairly big Credit Union and I asked her and she said of course you can offset your savings to clear your loan. If you not getting anywhere with a teller some who are partime ask for the supervisor who will sort it for you.

As other posters mentioned you need to be able to clear the full loan.

Thanks,
I rang again and was told it would be reviewed at a meeting on Monday and they would get back to me so hopefully I can clear it.