# credit union savings or loan to pay creditcard.



## paddyjnr (20 May 2010)

Hi I have a credit card which I owe 2,800euro to and I want to clear it as I am trying to restructure my outgoings.
I have 5,800 in savings and I owe 4,900.
Is it possible for me to use my shares to pay off the Credit card as I don't want to add more to my outgoings by topping up my loan..
We are both out of work and struggling with mortgage as is and paying interest only for the foreseeable future..


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## Welfarite (20 May 2010)

Talk to your credit Union; they may be able to use some shares and top up of loan to solve your CC issue. Even if you have to borrow the whole 2800 from CU, it'll be at a more favourable rate of interest. Another option might be to switch to 0% rate credit card if you feel able to clear it in the time allowed at 0%


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## niceoneted (20 May 2010)

I take it that the 4,900 is what you owe on your credit union loan. 
You will have to talk to the credit union but I cannot see if you take 2,800 from the 5,800 in shares to clear the credit to be a problem as it will leave 3000 in your shares. 
The only way you will know  for sure is by approaching the credit union. 
Another alternative is to clear the loan in the credit union with the shares and then take a new loan for 2,800  to pay the credit card. This should also reduce your outgoings.


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## paddyjnr (20 May 2010)

Thanks folks, I am going to talk to them now... I have been approved for the loan but it means bring my repayments up from 36euros a week to 50euros a week..
They have expressed that they are not to keen on letting me take out my shares but if the loan wasn't granted they would look into it.
I don't know what "To keen" means but it's something I have to talk to them about after I suppose.
The reality of it is I would prefer to take my savings as then I wouldn't be paying interest again. Thanks for all the replies.. 
I will let you know the outcome later..


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## Welfarite (20 May 2010)

Normally a CU uses ratio of shares to loan when calculating what you can borrow (my one gives five times the share amount as a loan, but that's unusual i think it's normally 4:1?).


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## paddyjnr (20 May 2010)

Welfarite said:


> Normally a CU uses ratio of shares to loan when calculating what you can borrow (my one gives five times the share amount as a loan, but that's unusual i think it's normally 4:1?).


 Thanks Welfarite, that sounds promising...


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## demoivre (20 May 2010)

paddyjnr said:


> Hi I have a credit card which I owe 2,800euro to and I want to clear it as I am trying to restructure my outgoings.
> I have 5,800 in savings and I owe 4,900.
> Is it possible for me to use my shares to pay off the Credit card as I don't want to add more to my outgoings by topping up my loan..
> We are both out of work and struggling with mortgage as is and paying interest only for the foreseeable future..



If I was struggling with a mortgage  minimising my loan repayments in general rather than minimising interest paid would be my priority, until I got back on my feet. I would use the €5800 to clear the €4900 cu loan and pay €900 off the cc leaving a balance of €1900 which would have min repayments of about €57 per month. If money was tight I would rather be paying out €57 per month than €200 per month ( which you will be doing if you get a top up from the cu to pay off the cc ). Once you get back on your feet clear the cc asap.


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## paddyjnr (20 May 2010)

Hi all,  just back from CU and was told if I wanted to take out my  shares I would have to put it before the board again.. 
I just wanted to get the CC people off my back quickly as I am unable  for the pesky phonecalls due to a couple of missed payments so I settled  for the top up loan which after a year or so I can clear my Loan with  my shares.
It is probably not the best option and Demoivre, if I had seen your post  before I left I probably would of reconsidered that option but I  suppose I was after the "quick fix" for the time being.
Thanks again all for your suggestions.


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## Slim (21 May 2010)

Hi Paddyjnr.

In my opinion it makes no sense to up your loan to €200 pm and I think the Cu is a little irresponsible in allowing you to do so. As you are only 24 hrs after being in the CU I think you could go back and say you have reconsidered and would like to reduce your shares by 2800 to pay off the o/s loan. Remember, your savings are earning very little in the CU and are no use if held as security. I think they would have to agree if you are insistent. They would still hold over 50% security against the loan. Despite the sense of what Demoivre says I think it would be best to owe the money to the CU rather than the Credit Card company. You are unlikely to be approved for a 0% credit card at present. Best of luck, Slim


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