2014 Lender Lists:

Short Term Loans | Payday Loans | Instalment Loans | 12 Month Loans
Doorstep Loans | Guarantor Loans | Logbook Loans

A Credit Union is a financial co-operative that is controlled fully by its member base. No profits are made with all such money generated being used to run and improve the services available to all such members. A range of financial products may be offered, but we are focusing here on the loans that become available through the collective community savings. There are around 500 Credit Unions across the UK with some being much larger than others (Leeds City for instance has over 27,000 members). What you can always be assured of is highly competitive interest. This is actually forced though a legal interest cap at 26.8% APR.

And so for a £100 loan over the month the maximum charge would be just £2. There is usually a small membership fee required to set you up though and some may also require you to hold a savings account with them (often with small savings). Either way, paying £2 per £100 is an incredible price and you can usually receive lower rates when you borrow over a year or beyond. A government-commissioned report back in 2012 stated that they believed that their model was not financially sustainable, although to be fair, most of the established names have been around for a long time with no known major closures.

Credit Union loans from the outside do look to be worth using for the financial benefits. There is of course another side to the coin though that can make these products much less attractive than those that are widely discussed here on Miyagi. To walk through some of the basics, you would have to initially join up and these are local organisations and so you will have to live or work in the area that the Union covers. You would usually have to apply through a branch or download an application form on the website. These sites are typically basic in their design, although some do house secure membership logins.

Same day funding may be possible, or you may have to collect through a local branch during operational times. Being able to access cash at the night or over the weekend is highly unlikely. Although damaged profile scores may be accepted, some may be more strict. One that I studied in Scotland for instance required no defaults in the previous 12 months and they did also credit check. It is common across most of course that the applicant is in a good standing to repay any such loan being applied for. Due to this, bank statements going back 3 months and payslips do tend to be asked for to qualify.

Are Credit Union loans worth using when factoring both sides? The competitive pricing is certainly appealing, but on the other hand there are many hoops to jump through here. I guess that most would opt for the efficiency of an online lender. If this is the case then it would be recommended to choose a flexible short term lender whereby you pay for the specific term only. I would personally do this myself, or instead just pick up an overdraft increase. If value is of the sole importance to you though then finding your local Credit Union would be the next step (www.findyourcreditunion.co.uk is recommended for searching).