Quick One about CU loans/savings

J

JP1234

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I had a search through the forums but couldn't find the answer. I don't know anything about how CU's work.

A cousin of mine needs money to fix their car and was trying to borrow it from various family members. It was suggested he use some of his credit union savings but he says he can't withdraw as he has a loan with them. He wasn't sure on the figures but reckons he owes owes about 2K and has 1200 in savings. It's his second loan from them. He only needs around 400 for the car. Is what he is saying correct - that while he owes money he cannot withdraw his savings, if that is the case wouldn't he be better just using the money he has in savings with them to pay off the loan and save interest? I had a look on the CU site but couldn't find anything, am I missing something here?:confused:
 
Each credit union is different, but basically his savings would have been used as security for the loan. On your second loan, I think you can borrow three times your savings, so if he owes 2K, he only needs to keep 650 or so on deposit.
 
Thanks for the reply (and to the person who sent the PM) I think I get it now
 
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