We’re pretty pleased with ourselves this week at the credit union. We heard about an amazingly good idea from some of the other credit unions, and today we are able to launch it to help families across Blackpool, Fylde, Wyre and Preston.
The Family Loan is designed to help people with children, who otherwise struggle to get credit. It helps them to cover unexpected or upfront costs, while also helping them to save money and improve their credit rating all at the same time.
It’s pretty genius actually. The Family Loan doesn’t rely solely on a credit check, which is an automated system where the computer either says yes or no. The decision is taken entirely by one of our loans officers based on an affordability assessment following a meeting where we’ll talk to you about your finances, and make sure you’ll not be over stretched by the loan repayments. This means we can help many more people than ever before, even those who usually get turned down by most lenders.
With the Family Loan we provide a £500 loan which is repayable over a year. Members can set up a direct debit, standing order or use one of their regular benefit payments. Many people choose to use their child benefit payments.
In this scenario, members save their child benefit with us and we arrange for part of it to be used towards paying off the loan, the rest will remain in the savings account and grow into a nice little nest egg. Because you’re making regular repayments, we can report that to the credit agencies which then helps to improve your credit rating.
We exist to help people who can’t get bank loans and credit cards, who turn to high interest payday or doorstep lenders and often get themselves into debt problems as a result. This new initiative is really going to help a lot of those people and we’re looking forward to welcoming new members to the credit union and helping them to sort out their finances once and for all.