# Credit Union Savings Exceeds Loan-Can Savings Be Used for Deposit?



## LouthLass (6 Apr 2009)

I hope someone can point me in right direction with this query I have.

Basically, I have approx €15k in savings with my credit union of which I have to date a loan outstanding of €10k - my shares are more than my loan and I have never missed a payment, I am ahead with the repayments and have been fortunate enough to be able to make regular monthly lump sum repayments of €600 on top of the weekly payments as well as keeping to the agreed weekly payments - I anticipate that I clear the loan within the next 6 months if I continue the current repayments.

My query is this, I have seen a house that I like in a rural area at which I believe I can get at €130k and I want to approach the mortgage lender with a 10% deposit of €13k - will the credit union allow me to withdraw €13k savings which will mean the loan will outstrip the savings even though I have never missed a payment and have in fact always overpaid the minimum payment due?  I know I can pay the loan off in full within the year - will the credit union allow this?

I will call to see the loan manager in my credit union this week but I am wondering if other AAM's have come across a similar situation and how they dealed with the situation?

Regards

LL


----------



## Happy Girl (6 Apr 2009)

If you were in my local credit union this would not be a problem however my understanding is that rules & regulations vary from one credit union to another. The position of my credit union is that you must hold one fifth of the value of the outstanding loan i.e. if I have a loan of 10k I need only to have 2k on deposit.


----------



## demoivre (6 Apr 2009)

Agree with Happy Girl - depends on the particular Credit Union and on the track record of the borrower. In the past I have borrowed much more than 5 times savings from my credit union though it's often been said on here that borrowing 3 times savings is more typical from a credit union.


----------



## heretohelp (6 Apr 2009)

hi there,
in no means trying to hijack a thread here but i too am in a position where i find myself needing to withdraw from the credit union, i have a 30k loan, and almost 8k in savings, my credit union require us to borrow 5 times our savings, and now that i have been paying the loan for a while i am wondering that as the capital has decreased could i withdraw some savings!!!
if i only need 6000 to guaranteee the 30 , ie, 6x5=30, can i withdraw around 2 of my 8k ?? Thanks in advance and sorry for posting on another OPS thread


----------



## Crugers (6 Apr 2009)

The Credit Union Act 1997 P3 S32.3 states that it is possible to withdraw shares while you have a loan but it is limited to retaining 25% of your outstanding liability as savings (shares and/or deposits). This can only be done with the approval of the majority of the Board of Directors.

Since each CU is autonomous, it sets its own policy. So you will only get definitive answer by asking your own CU.

It is possible within the CU Act 1997 to get a loan without any restriction as to ratio of shares/deposits to loan. So technically ratios of 1000's:1 are possible but again...since each CU is autonomous, it sets its own policy. So you will only get definitive answer by asking your own CU.


----------



## LouthLass (6 Apr 2009)

Many thanks for all the helpful responses, I am going into my CU tomorrow so fingers crossed

Kind regards

LL


----------

