Wondering about mortgage with Cred Union

D Trent · 11-09-2018 2:16pm #1

Hi I'm sorry if there's already been discussion on CU mortgages.

What are the pros and cons of a credit union mortgage.

Seeing as banks are highly competitive this weather, will each credit union always have a higher rate realistically?

Have you had or heard of good /bad experiences of someone getting mortgage through their CU?
Thank you

uck51js9zml2yt · 11-09-2018 2:33pm

Never heard of them giving mortgages!

greenttc · 11-09-2018 2:38pm

Eliseo Fancy Rye wrote: »

Never heard of them giving mortgages!

They do give them, they are called housing loans, my credit union gives them up to 300k over 25 years. No experience of using it though

rachaelf750 · 11-09-2018 5:09pm

I have received the following info.

I have been advised the Interest Rate would be 4.99% APR.
Interest is worked out on the remaining loan amount not the total loan amount.

You will need to take out life insurance.

I'm considering a c/u mortgage over the government loan myself.
I hope to buy next year.

GingerLily · 11-09-2018 5:12pm

rachaelf750 wrote: »

Interest is worked out on the remaining loan amount not the total loan amount.

Is that different to any other loan?

Claw Hammer · 11-09-2018 5:13pm

rachaelf750 wrote: »

I have been advised the Interest Rate would be 4.99% APR.
Interest is worked out on the remaining loan amount not the total loan amount.

.

That is the same with every loan.

DubCount · 11-09-2018 6:55pm

4.99% is quite high for a mortgage on your PPR

L1011 · 12-09-2018 8:17am

GingerLily wrote: »

Is that different to any other loan?

Only credit cards charge on full amount despite partial payment basically. Every mortgage recalculates interest as repayments occur

Henry Ford III · 12-09-2018 8:47am

D Trent wrote: »

...Seeing as banks are highly competitive this weather....

They compete with each other, but their margins are actually pretty high.

hognef · 12-09-2018 9:06am

L1011 wrote: »

Only credit cards charge on full amount despite partial payment basically. Every mortgage recalculates interest as repayments occur

Surely, also for credit cards, the interest is calculated on the outstanding balance, or am I misunderstanding you here?

L1011 · 12-09-2018 9:45am

hognef wrote: »

Surely, also for credit cards, the interest is calculated on the outstanding balance, or am I misunderstanding you here?

Generally with credit cards you are charged interest on the full balance at the time of statement even if you've paid off all but a cent of it. It is only interest free if paid absolutely in full.

GingerLily · 12-09-2018 9:45am

hognef wrote: »

Surely, also for credit cards, the interest is calculated on the outstanding balance, or am I misunderstanding you here?

Its calculated on the balance at a certain date each month, not the balance on the billing date. But I would agree with you that its essentially the same with a delay is all.

Claw Hammer · 12-09-2018 12:18pm

L1011 wrote: »

Generally with credit cards you are charged interest on the full balance at the time of statement even if you've paid off all but a cent of it. It is only interest free if paid absolutely in full.

You pay interest on the full balance at the time of the statement until anyting is paid off it. Then it is on the declining balance. Interest is charged on the balance at all times since the last payment unless it is cleared time an i full.
Interest is never charged on money that is not outstanding.

13-09-2018 3:37pm

Pro of a CU loan is you can pay more than you like to an unlimited amount. For example, i am lead to believe that with traditional banks, you only can pay back an agreed set amount over the actual repayments.

With the CU I can wander down tomorrow and pay 10k off the loan and they won't bat an eyelid. So if you're in a position to that early on, then going with the CU is a good idea. You can always look at switching it over to a 'normal' bank once you think you're gonna start repaying normally. but if you can get ahead on the loan from the word 'go', then you can knock years off the term with a bit of effort.

There are rules, the gist of it in Drogheda is that you can only borrow up to 100k. You have to have a minimum of 5% of the value of the loan in your savings, the loan is secured against the house with the CU getting a first legal charge on the property, etc.

It's called a Home Improvement Loan, as, as has been said, the CU aren't really allowed to do actual mortgages (unless that's changed in the mean time).

Claw Hammer · 13-09-2018 4:00pm

Deleted User wrote: »

Pro of a CU loan is you can pay more than you like to an unlimited amount. For example, i am lead to believe that with traditional banks, you only can pay back an agreed set amount over the actual repayments.

.

Unless you are on a fixed term interest rate with a bank you can pay down part of the outstanding balance at any time up to any amount.

cruizer101 · 13-09-2018 4:23pm

Even with fixed terms you can overpay, the amount varies but the penalties are much less than they used to be if you go over that.

Re credit unions giving mortgages as far as I know some of them do but it is not across the board, remember different credit unions are different entities.

Tbh I'm not sure why anyone would go with them unless they were refused from all the banks and CU approved as the rates the banks are giving these days are much better than the CU.

Avatar MIA · 13-09-2018 4:27pm

Credit union loans are relatively very expensive compared to a bank.

Claw Hammer · 13-09-2018 4:29pm

At one time Credit Unions were charging 1% a month on the balance of the loan. The Apr worked out at about 25%. Madness.

Wisesmurf · 13-09-2018 4:38pm

CU at 4.9% is absolute robbery in the current market. Current advise with the experts on another irish forum is to fix.

You can fix with Ulster Bank for 4 years at 2.6% and that would literally save you 100's over the 4.9% every month. UB also allow you overpay whilst on fixed up to 10% of the capital of the loan every year.

You can fix for 10 years at ~3.5% with BOI and get all sorts of cashback with them. That would save you tens of thousands over the 4.99% over the same period.

Anybody even considering a mortgage should at mimimum read and understand the offeres from evey institution in Ireland.

bri007 · 13-09-2018 5:35pm

Most credit unions require 20% deposit as well along with higher interest rate!

14-09-2018 3:41pm

Claw Hammer wrote: »

Unless you are on a fixed term interest rate with a bank you can pay down part of the outstanding balance at any time up to any amount.

Hmm, that's interesting to know. Not how it was explained to me in the bank at the time and was one of the reasons I wanted a CU loan.

Wondering about mortgage with Cred Union

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