I have to disagree (not a lot!
) with the words written by both ontour and demoivre above.
You can offset your shares against your loan under Section 32(5) of the Credit Union Act.
In demoivre's case we are talking about "offset" - the funds are NOT leaving the CU i.e. there is NO CHANGE in the overall/net indebtedness.
The quote, relevant to demoivre's statement, from the CU Act is:
"
Where a member of a credit union is indebted to the credit union and consents in writing to the credit union acting under this subsection, the credit union may..."
So it MUST be the CU acting to offset and then the Member can consent (in writing)!
In both cases, withdrawal and offset, the CU can refuse to act!!! IMO they wouldn't be acting in the Members best interests and in some cases would definitely be putting the CU's interests before the interests of the Member - which is hard as the Member is part of the CU...
So demoivre's statement should read -
The CU can offset your shares against your loan under
Section 32(5) of the Credit Union Act...
Of course that doesn't exclude the Member from making representations to the CU and prodding/poking/kicking them into action...
What you need to do is ask them to start the process. Don't take "
they can't" for an answer -
THEY CAN!
But it is possible that they WON'T!!!
That's an argument for another day!
Well done tk23 for succeeding in your quest and well done your CU who have acted in your best interest!
This constantly confuses me as the way I read the act is that the member can only decide to offset or withdraw if the shares after the transaction are not less than 25% of the liability In this case the OP is already below 25% so has no scope to demand the offset.
Based on indebtedness the credit union can make the decision based on a lower ratio, so the OP can certainly request the offset based on financial circumstances but has no automatic right.
What am I missing?
The quote, relevant to ontour's statement, from the CU Act is:
"(3) If a member of a credit union seeks to withdraw a share in or deposit with the credit union at a time when he has an outstanding liability (including a contingent liability) to the credit union, whether as borrower, guarantor or otherwise, that withdrawal shall not be permitted unless—
(a) were the withdrawal to be permitted, the value of the member's savings immediately after the withdrawal would be not less than the amount of his outstanding liability; or
(b) the withdrawal is approved, in accordance with the registered rules, by a majority of the members of the board of directors voting at a meeting of the board;
but no approval may be given under paragraph (b) if, were the withdrawal to be approved, the value of the member's savings immediately after the withdrawal would be less than 25 per cent. of his outstanding liability."
In ontour's case we
are talking about a change in indebtedness! The exposure of the CU goes up and the net indebtedness of the Member goes up!!!
Requests for withdrawals can be made by the Member. However they must be approved by the (majority of) Board and can only be approved within certain boundaries/limits - 25% etc...
The only thing that the Member can
decide is to request the withdrawal or an offset!!!