# credit union: takes my shares against my arrears without telling me?



## superman11 (13 Oct 2013)

Hi

can anyone advise, I am in arrears in my credit union of €1,700, and went in on sat to find out that the board of directors have decided to take my shares of €1,100 against the loan arrears as a write off, cancelling out the other €600

1.could they have done this without telling me?
2. could they have instead taken my shares against my loan and left the remaining €600 for me to repay instead of a write off of my arrears which I think will make me look worst than i already am?
3. i was in several times and asked to restucture my payments & was told to leave as it is and pay what i can - now im in a worse position 
4. this write off will make me look worse than being in arrears if i want another loan in the future

Feel desperate as all along i highlighted that i didnt want my credit rating to look bad

please help


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## Luternau (13 Oct 2013)

What does the terms of the loan/credit union say?
It seems logical that they can offset shares against arrears. The write off of €600 seems like a good outcome too. You now have no loan, and no arrears!
Are you sure they have ruined your credit rating? You are now free to start rebuilding your shares and credit rating.


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## superman11 (13 Oct 2013)

I still have the loan, start repaying again with no interest, they only written off the arrears.

Im not sure if they have ruined my credit rating I have applied to icb today to see, have to wait 2-3 days for letter to arrive, but wouldnt the write off look worse than being in arrears?

Would i have aleg to stand on if i went up against the credit union because i asked for my loan to be re-stuctured numerous times but was told to pay what i can?


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## Brendan Burgess (13 Oct 2013)

They have done you a favour by setting your shares against your loan. 

We often recommend this on Askaboutmoney,  but the Credit Unions often refuse to do it.

You were being charged up to 12% on your loan and paid probably around 1% on your shares. 

By setting your shares of €1,100 against the loan, they are saving you around €120 a year in interest. 



  |before the set-off|After the set-off
main loan - say | €3,000|€3,000
Arrears|€1,700|€ 600
Shares| €1,100| 0
Net borrowings| €3,600|€3,600
So your net position has not changed.  You are just being charged less. 



superman11 said:


> Hi
> 
> I am in arrears in my credit union of €1,700,





superman11 said:


> Im not sure if they have ruined my credit rating



They have not ruined your credit rating. If your credit rating is damaged, it's because you went into arrears. 

Your arrears are now lower, so you can clear them quicker and you can begin the process of restoring your ICB record earlier.


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## superman11 (13 Oct 2013)

Thanks Brendan, I understand my credit rating could be damaged due to myself and going into arrears. 

So I have it right in my head are you saying that the write off on the arrears has not made me look worse as reguards to my credit rating, my position has not changed but I am now just paying less?

Many thanks


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## Brendan Burgess (13 Oct 2013)

Correct!

It makes you look better.  Your arrears are only €600 , not €1,700 

Brendan


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## superman11 (13 Oct 2013)

oh sure thats better i think in the long term, thank you so much for your time to reply to me, feel abit relieved.

Thanks a million


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## Slim (14 Oct 2013)

@superman11

Your post is not too clear. Was the amount of your arrears €1,700 or is this the balance of your loan? It is hard to believe that the CU would write off your loan without writing to you making it clear that this would happen. 'Write off' is an accounting term whereby they freeze interest on your balance and use your shares to pay down the sum owed. It is likely that, if your CU is signed up to ICB, that your failure to meet the repayments has been recorded already on ICB, long before the write off. On the other hand, your CU may not be signed up with ICB. Either way, you now only have to repay the €600, interest free. S


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