Need a Loan?

"The Credit Union offer a range of services to our members"

Need a Loan?

The Credit Union will consider loan applications from members for any worthwhile purpose. Each application is treated in the utmost confidence and will be considered on its own merits. It is credit union policy to meet the borrowing requirements of as many members as possible, depending on the available funds.

Lending Criteria

• You must be a member of Western Isles Credit Union to apply for a loan with us.
• The maximum loan limit is £7,500, depending on individual circumstances. 
• A pattern of regular savings totalling at least 20% of the loan value (or £500, whichever is the lowest) should be achieved before a Loyalty Loan application is considered.  In these circumstances, the interest rate charged is between 1%  - 1.75% per month depending on the value of the loan (see table below). 
• Where a Members shares are less than their outstanding loan amount, they will be held as collateral for that loan and withdrawals will not be allowed.
• Freedom Loans may be applied for before a Member has saved 20% of the loan value.  In these circumstances, the interest rate charged is 2% per month.

Interest Rate table

	Min Loan	Max Loan	Monthly Interest Rate
Freedom Loan	£100	£7,500	2.00%
Loyalty Loan	£100	£1,499	1.75%
	£1,500	£2,999	1.50%
	£3,000	£4,999	1.25%
	£5,000	£7,500	1.00%

Applications for loans are made on a standard loan application form.  Loans can be applied for by calling to our office or by telephone.   To support your application, you will need to provide proof of income and recent bank statements and complete a budget planner.   Where an applicant is employed, we must see the last 3 pay slips.  For telephone applications, these documents can be posted to the office.

Our staff will give you any assistance required. Loans will then be considered by a Loan Officer, or will go to the weekly Credit Committee meeting.

Loan Application

Download Loan Application Form (119.4kb) The Loan Application form is a PDF document and Adobe Acrobat Reader is required to view it. Adobe Acrobat Reader can be downloaded for free by clicking on the Get Acrobat Reader icon.

What you need when applying for a loan

In deciding whether or not to grant the loan the loan officer or credit committee will take into account the member’s record of savings and loan repayments, as well as ability to repay. Once the loan is granted the member will be asked to sign a credit agreement, which is a legally binding document being a promise to repay the loan, and commit to regular repayments.

Remember - only members are eligible to receive loans from your credit union.

Planning and managing repayments

Credit unions are flexible with regard to repayment plans, though there are some legal limitations to length and amount of loans. The member will be advised on the best repayment plan to meet their own circumstances. Members are generally advised to repay a loan in as short a time as possible. 5 years is currently the maximum loan term. Should a member experience difficulties in meeting repayment commitments, they should immediately explain the situation to the credit union, which will treat the matter sympathetically and in total confidence. Depending on circumstances, the loan will be renegotiated if possible.

There are no penalties associated with clearing your loan quicker than agreed.

Interest on credit union loans

By law credit unions cannot charge any more than 2% per month on the reducing balance of a loan. Credit unions do not transaction fees. Since the interest is charged only on the outstanding balance of the loan, you will pay even less if you repay in a shorter time than planned.