Credit unions offering mortgages

martin18

Heya, as a recently returned emigrant I was advised in another thread to discuss a possible mortgage with AIB and credit unions. I've looked at a fair few credit union websites for my local area - Dublin South - but none seem to offer mortgages. Can anyone point me to credit unions that do, for properties in the S Dublin/Wicklow area? Thanks a million.

phormium

I would call the larger ones and ask, they may not always be advertised as mortgages, could come under their loans as they take the security of the property, doesn't always work the same way as an actual mortgage.

Merowig

Credit Unions are way more expensive usually than banks to finance your house.

2Mad2BeMad

Capital Credit Union is the one I'm with.
There one of the larger ones in Ireland.
But you'd be mad to get a mortage with them

4.9%apr

300k borrowed(max you can borrow) over 25 year (max term) according to there calculator would mean I'd pay back 515, 697. 27e

Cost of credit 215, 697.27e

Thats nuts and I couldn't think of any reason for anyone to go this route.

Indestructable

Croi Laighean Credit Union do mortgages. As was said earlier though the rates are quite high.

Drogheda Credit Union have absorbed a few of the surrounding credit unions and grown a bit in the last few years. As a result they have started pushing "secured loans" which is their answer to a mortgage.

They charge 5.9%, but as a general rule of thumb, each year they give out a payment to you which equates to a refund of 10% of the interest you've paid throughout the year.

For me personally, I've used their loan and bought a house with it. Credit Union were quicker and more flexible up-front to deal with. I was buying the house in a fairly complicated situation and they gave me the money for it where the banks weren't quite so interested (or at least BoI weren't). Another upside to them is that they didn't make me set up a direct debit. I owed a monthly payment, but they didn't care when it was paid. I don't get paid monthly, so there are times it's been unpaid for a few months, and they never said anything. (that said, although I was behind initially, because of this, after the first year I got ahead of the repayments and have since knocked the loan term from 15 years to what will end up being around 4 years - so maybe they just don't give me hassle if i don't pay on time anymore, as im so far ahead).

A downside to the credit union is if you save up a deposit, you can't use it. They secure your savings against the loan. So if you've got 20k in the bank and are buying a 100k house, with a normal bank you'd get a loan of 80k, and use your 20k towards the house. With the credit union your 20k is locked against the loan, meaning you've to get, and pay interest on, a loan of 100k. (at the end of the loan, when your debt is equal to, or lower than, your savings, you can use your savings to wipe out the remaining debt, but you've paid all the hefty interest at that point anyway).



I'm looking into buying another house now in the next couple of years, in more traditional circumstances, and Bank of Ireland have a cashback offer of 2% plus 1% in 5 years, and they have a savings account where if you save your deposit with them they'll give you 2k back when you drawdown. The Credit Union don't seem to do any such kind of incentives or offers.


BoI interest is about 3 to 4.5% (fixed VS variable) whereas my credit union is 5.9%.

As a general rule of thumb, I've found my local credit union to be friendly and less formal than their traditional bank counterparts. However, they are not at all competitive when it comes to mortgaging or loans of large amounts. Even when comparing a car loan, my CU is 5.9% and BoI work out at 6.9%.

Also, my credit union can't give you two loans. Every loan is a top up on the existing loan, whereas I can have two separate loans (or more) running along side each other with Bank of Ireland.

I've moved from doing everything with the CU, to dealing more with BoI in the last few years.

Spocker

Deleted User wrote: »

that said, although I was behind initially, because of this, after the first year I got ahead of the repayments and have since knocked the loan term from 15 years to what will end up being around 4 years

Its worth highlighting this bit, in that the CU don't charge for this type of facility, but many of the banks are not so flexible

Spocker

Spocker wrote: »

Its worth highlighting this bit, in that the CU don't charge for this type of facility, but many of the banks are not so flexible

If you're referring to over-payments, then banks won't charge for making over-payments, either, assuming you're on a variable rate (which the CU is).

If it's a fixed rate, then the Bank will charge a fee if you try to overpay. They usually allow you to overpay by a small set amount (think BoI allows an extra €65 per month). However, if you win 10k in a raffle, you'd have to break your fixed-rate agreement with them to pay it off the mortgage, which can sometimes bring upon additional "breakage" fees.


If you're referring to the 'pay when you like' part of my post, you're right though. Banks (in my experience) are generally rigid when it comes to having to pay on a specific day of the month.

phormium

Generally the reason people use a CU for a mortgage is because they can't get one from a bank so the rate doesn't come into it for them as they don't usually have other options.

Be nice if it was different alround but that's the way it is!

martin18

Brilliant feedback, thanks ever so much to you all. Yeah, the deck is stacked against me - I have high savings but not enough to buy a home outright, so I'll need a mortgage. But I'm self-employed, back from the US less than a year. AIB seems relatively promising having had a good talk to them the other day, but I need to explore all the options in case that doesn't work out.

Thanks again.