Has anyone applied for a Credit Union mortgage?

dark crystal

Hi, myself and my partner are both in the Civil Service, me for the last number of years and himself since March.

I've been saving in the PSCU (which doesn't currently offer mortgages) for the last year and he's recently joined his own branch (which does offer mortgages)and started the process of saving. We're hoping to have a deposit together within the next two years. As we're both in our 40s, time is of the essence! Both first time buyers.

Interest rate appears to be a bit higher than banks rates - approx 3.75% - but I like the idea of a more personal service and there are certain perks like free life cover and 5% interest rebate each year. Has anyone ever gone through the mortgage process with their Credit Union and if so, how did ye find it?

Apologies if there's already a thread somewhere, I couldn't find one anywhere!

dory

Have you checked how much more you're going to be paying in interest for the personal service? Karl's mortgage calculator is great for that. You can check what you'd pay on their rate, and the best rate you'd get in a bank. Personally I wouldn't pay anything at all extra for a personal service, but if you have the money then go for it!

Merowig

The life cover isn't free - you pay for it with the much higher interest rate.
Go for the cheapest mortgage you can get - will save you thousands.

frank730

they are more expensive but definitely more helpful to deal with. maybe get your mortgage with a credit union for a few years and switch to a bank who offers lower rate.

Sir Galahad

3.5% mortgage rate with PSCU.

reggie3434

PTSB are very civil service friendly and I found you could borrow more with them

SupaCat95

Home truths they are a sub-prime lender. The only reason you are looking at them is because the main lenders (aib, boi, avant, ptsb) see you as a bad risk or the amount is too small (not worth getting out of bed for less than 300k mortgage).

Mother had it bate into us as kids "the credit union is our friends and the banks are evil". When we went for our mortgage rate there was a 4% difference between avant and CU.

JCN12

https://www.boards.ie/discussion/comment/121652392#Comment_121652392

Credit unions are not sub prime lenders lol.

SupaCat95

Oh yes they are the same as subprime lenders. They charge a higher rayte because they lend to greater risk people.

Ubbquittious

How does a credit union issue a mortgage? Are they able to work the fractional reserve system to cast new money into existence like banks or are they relying on some bank behind the scenes to do the heavy lifting for them?

Nigzcurran

https://www.boards.ie/discussion/comment/121685541#Comment_121685541

Think my local credit union is charging 4.5% variable. Is that not similar to a bank?

SupaCat95

Well they have massively improved since three years ago. I am no longer shopping for mortgage thank god. Credit Union were 8% (I grasped my pearls) while BoI were 3.2 and AIB were 2.4 and Avant were 2.45.

The Credit Union would lend for smaller amounts like 80k. The bank were making excuses not to lend to us. Its not worth writing a mortgage for 80k.

phormium

https://www.boards.ie/discussion/comment/121686097#Comment_121686097

They are awash with member savings, limits in most CUs as to the amount you can have in your account at this stage as they just don't want it all! Mine reduced from 100k to 30k several years ago and have only recently upped it to 40k.