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Consequences of using shares against a Credit Union loan?

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  • 20-06-2014 3:29am
    #1
    Ireland..
    Registered Users Posts: 39 ✭


    Hi guys,

    I got a holiday loan back in late June of last year, around Christmas time however I used the shares against the loan as I needed the money.

    The woman who dealt with that asked if I would be applying for a loan again anytime soon, which I didn't think anything of at the time.

    I will be needing a loan in a few weeks for a holiday, is there any point in me asking them since I put my shares off the loan?

    I was just thrown a little thinking of what that woman asked me, surely it was for a reason?
    I should add that I only have €300 in my shares and I would be asking for about €650
    Thanks


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    #2
    matt70iu
    Registered Users Posts: 415 ✭✭matt70iu


    Ireland.. wrote: »
    Hi guys,

    I got a holiday loan back in late June of last year, around Christmas time however I used the shares against the loan as I needed the money.

    The woman who dealt with that asked if I would be applying for a loan again anytime soon, which I didn't think anything of at the time.

    I will be needing a loan in a few weeks for a holiday, is there any point in me asking them since I put my shares off the loan?

    I was just thrown a little thinking of what that woman asked me, surely it was for a reason?
    I should add that I only have €300 in my shares and I would be asking for about €650
    Thanks

    The Reason she asked you weather or not you would be applying for a loan again any time soon is your Shares are considered security for your loan.

    The fact that you would have less shares would affect the amount you could borrow in the future.

    I would expect you'll be fine in this instance as you are only looking to borrow 2 times what you have in shares. You may pay a higher interest rate as the loan is considered unsecured.

    Apply, worst they can do is say no:) Just be careful this isn't the start of the you living off debt rather than what you're earning. Been there... results aren't pretty!

    Best of luck


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    #3
    Goat the dote
    Registered Users Posts: 726 ✭✭✭Goat the dote


    Have you still money owing from last years loan?


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    #4
    Ireland..
    Registered Users Posts: 39 ✭Ireland..


    matt70iu wrote: »
    The Reason she asked you weather or not you would be applying for a loan again any time soon is your Shares are considered security for your loan.

    The fact that you would have less shares would affect the amount you could borrow in the future.

    I would expect you'll be fine in this instance as you are only looking to borrow 2 times what you have in shares. You may pay a higher interest rate as the loan is considered unsecured.

    Apply, worst they can do is say no:) Just be careful this isn't the start of the you living off debt rather than what you're earning. Been there... results aren't pretty!

    Best of luck
    thank you, I usually just borrow for holiday money in the summer but I can see that living off debt could be dangerous.
    do you know if I need proof of address to apply?
    I'm going down Monday but I just can't remember if I need proof of address


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    #5
    Ireland..
    Registered Users Posts: 39 ✭Ireland..


    Goat the dote wrote: »
    Have you still money owing from last years loan?

    No I haven't borrowed since using the shares against the loan in November and I always paid back my loans months in advance.
    I just thought they might say no based on using the shares against the loan, but then again I always have a feeling they will say no and they don't


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    #6
    ComputerKing
    Banned (with Prison Access) Posts: 770 ✭✭✭ComputerKing


    My advice is to stop taking out loans and spending money you don't have its a recipe for disaster even if you are managing to pay them back now you'll start taking out bigger loans and then you won't be able to pay them back and you'll end up going in debt.


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    #7
    matt70iu
    Registered Users Posts: 415 ✭✭matt70iu


    Ireland.. wrote: »
    thank you, I usually just borrow for holiday money in the summer but I can see that living off debt could be dangerous.
    do you know if I need proof of address to apply?
    I'm going down Monday but I just can't remember if I need proof of address

    You may do. Particularly as credit unions are now subject to many of the same procedures as banks. Best to being a bank statement or utility bill dated within 3 months and photo id, just to be on the safe side.

    I would expect them to ask for proof of income as well such as payslips etc particularly as the loan, though small, is unsecured. So perhaps best to have that in hand as well.

    Good that you can see the traps that loans can cause. I started off small just like you and got into a mess of over 40k, never again!


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