Credit unions provide affordable loans
Credit unions provide loans at a rate you can afford
Some credit unions loans will cost you no more than 1% a month on the reducing balance of the loan (an APR of 12.7%). For example if you borrowed £1,000 over 1 year, you would repay no more than £1,067 in total.
Many credit unions charge less, some may charge more but by law this cannot be more than 2% a month on the reducing balance (an APR of 26.8%). This table illustrates what you would repay if you borrowed £500 over 1 year.
Rate |
Loan Amount |
Interest |
Total Repayable |
12.7% |
£500 |
£34.06 |
£534.06 |
26.8% |
£500 |
£69.55 |
£569.55 |
| Illustration only - check directly with your credit union | |||
You can work out how much a credit union loan could cost you by using our handy Loan Calculator on the right.
- Loans come with no hidden charges and no penalties for early repayment.
- You can also carry on saving, so that by the time you finish repaying the loan your savings would have grown as well.
- Life insurance is built in at no extra cost to the borrower. So if you were to die before you repaid the loan, insurance would repay the loan for you.
Margaret from Glasgow has been a credit union member for the past 4 years. I didn’t have any savings put aside to help with my son’s University fees so I looked into a loan. I noticed that the rates advertised by the banks often increased when I rang up which put me off. Then someone suggested Glasgow Credit Union. I was delighted with their service and had to double check that the low interest I was paying was correct!
“Credit unions aren’t just an oasis for those struggling to qualify for high-street borrowing. Some of these non-profit financial savings and loan co-operatives can be best-buys for those looking to borrow smaller amounts.” www.moneysavingexpert.com
