Credit Unions - budgeting, savings and loans
Credit Unions can now help you to organise your money.
Those tenants who are affected by the under occupation charge, or will be transferred over to Universal Credit, may find it hard to organise their finances and to pay the bills.
This will be more difficult when Universal Credit comes. Benefits will be paid monthly in one lump sum. It will be up to you to make sure your bills are paid and that you have money to pay for living expenses. Tenants who have been involved in the pilot schemes for Universal Credit have struggled to do this; rent and Council Tax arrears have increased and some tenants have not had money at the end of the month to buy food and other essentials.
NCHA have been working with Nottingham Credit Union to develop new ways to help you manage your money.
Credit Unions in your area
This makes sure your rent is paid by having your wages or benefits paid direct to the Rent Payment Credit Union Account, out of which your rent is paid and the rest goes to your bank account, a pre payment card or a Credit Union Current Account for you to spend.By signing up to a Rent Payment Account you will get:Life-time membership to a credit unionA pre-paid card that you can use on-line or in shops to pay for thingsA rent safeguarding and payment service called Rent Direct, free of charge to you, so your rent is paid on time every timeSome money for your 'share' in your credit union(s) (you will need to keep this money in your account to keep it open)All setup costs are paid for by NCHA, and we will help you complete the relevant paperwork. Contact your Income Officer for further information and to start your application.
If you want your all your bills to be paid first so that you know how much you have to spend, this might be the account for you. You can arrange for payment of all your regular bills with monthly payments. The rest of your money will be paid into your bank, post office, credit union account or on to a prepaid card.NCHA will pay the £10 fee to set up any of these accounts. For more information go to www.emheartcu.coop. Please talk to your Income Officer if you want to use the Credit Union to help you manage your money..
Some tenants have taken out loans with Door Step lenders such as The Provident or High Street lenders such as Pay Day Loans or Brighthouse. The interest rates charged by these firms start at 200% and can go up to over 1,000%.
Compare Credit Union Loan rates with Provident:
| Lender ||Borrow || Weekly payment || APR charged || Total interest charged |
| Credit Union ||£500 || £10.00 || 26.8% || £69.77 |
| Provident ||£500 || £17.50 || 272.2% || £410.00 |
|Lender ||Cost of washing machine ||Cost including interest |
|Credit Union ||£299.99 ||£338.01 |
|Brighthouse ||£491.98 ||£1,000.00 |