# CU €8.3k outstanding loan, €3,4k shares, €350/mth repayment: use €2.9k bank savings?



## 1939 (4 Feb 2012)

Hi guys,

  Need some advice on money matters

  I have a loan in the credit union that I am looking to pay off in the soonest possible amount of time.

  The loan is now at €8300
  Shares are at €3359 

  I pay €350 per month on this loan, that’s all I can afford.  After interest, I’m paying off about 280 per month of the actual loan.

  I have €2900 in the bank saved and will use this but I don’t know how or where to put this money in the best way to pay off the loan? Shares or payment of loan? 

  I understand and hope! that when shares = loan left that the CU will neutralize it all and I wont have any more to pay

  Any advice really appreciated


----------



## ajapale (4 Feb 2012)

Hi 1939 and welcome to AAM!

Ive expanded your title a little to more fully reflect and summarise your question. Let me know if this is ok.

What interest are you earning on your bank savings?

Do you place any value on CU membership over and above pure financial value? Personally Im prepared to continue with a small CU savings account even if I can get a better return else where or could borrow cheaper else where. I stick with the CU because of its social, community, mutual, small scale ethos and perhaps in fear that other sources of credit might dry up in the years ahead.

aj
moderator


----------



## 1939 (4 Feb 2012)

Yes that’s fine about the title thanks AJ. 

  I fully intend to stay a member after this loan is paid off. Its just my contributions wont be as bulky as they are now while trying to pay off this loan. 

  I’m not earning much interest at all with bank savings, it’s not a savings account or anything. I just accumulated the money over time. 

  I was told by the credit union that they would set my shares against my loan when they are both equal to each other, but I’ve heard of it being difficult of late to do this... so that’s why I have held the €2900 in my bank account until I know what to do with it!


----------



## ontour (4 Feb 2012)

Decide how much of an accessible 'rainy day' fund you need and put that in an accessible savings account, whichever one best suits your needs, check out the Deposits Best Buy thread.  If you have money left over from your bank account, pay that off the credit union loan.  Talk to the loan officer / manager of the credit union and ask how much of the savings you can offset against the loan.  You are probably getting very little dividend so any amount you can move from the CU shares to the loan will accelerate your repayment.


----------



## Slim (4 Feb 2012)

Hi 1939
You can immediately reduce your loan by €1200 from your shares by writing to the credit union and asking them to do this. You could then reduce the balance by your bank savings. You will have halved your loan at this stage. Your repayment could be reduced or you could keep the same repayment going. Having a 'rainy day' fund may affect your decision here.


----------



## Alwyn (24 Jul 2012)

Slim said:


> Hi 1939
> You can immediately reduce your loan by €1200 from your shares by writing to the credit union and asking them to do this. You could then reduce the balance by your bank savings. You will have halved your loan at this stage. Your repayment could be reduced or you could keep the same repayment going. Having a 'rainy day' fund may affect your decision here.



Most CU's will refuse to put shares against the loan balance.  We tried asking in the past and got and flat refusal.


----------



## Mrs Vimes (24 Jul 2012)

There is another thread on here which states that they have to and also gives details of where that is in legislation.


----------

