Tenants and homeowners that need a loan to pay rent or mortgage may have a reasonable short-term option available through a local credit union. Newport Credit Union is an open “common bond” credit union that allows membership by anyone who lives or works in the town.
The common bond membership policy means that any Newport resident as well as any Gwent resident that works within the city may join Credit Union. For those individuals that take advantage of this and sign up for membership, they can have access to their favourable interest rate products. Any money they then need to borrow will be at a lower interest rate. This will make it a much easier loan to repay than what you might find with a predatory payday lender.
Borrowing any type of money in Newport can be a tricky proposition, unless you take advantage of the benefits of a credit union. There are many reasons to do this. One main one is that Newport Credit Union offers low interest loans to its members for a number of needs. In some cases the rate can be a few percentage points lower than a bank, depending on a number of circumstances. While many people borrow for buying a car or other needs, many residents are finding that it is a much cheaper alternative to use the funds as a form of loan on their rent.
Imagine finding yourself between jobs for 2 months. A small dollar loan of £1,000 to £2,000 might be enough to keep all of your bills and debt payments current without having to worry about late payments and damaged credit. So there are reasons to do this.
Loans may carry interest rates of roughly 24-27% for smaller dollar amounts, but the rates drop to the 17-20% range if you borrow more than £2,500. While those interest rates may still sound high at first, they are much lower than some of the alternatives. Many banks charge higher rates, and it is definitely less than what you would find yourself paying a company offering payday loans in Newport.
Individuals do have different choices, however using the credit union will always tend to be cheaper than borrowing from a bank or a third party. These loans are also designed to be repaid in under 3 years, so you can limit the actual amount of finance charges by repaying the funds across a shorter period of time.
There is additional flexibility with a Newport Credit Union loan. Let’s say that you borrow £3,000 and pay down the balance to £1,500. You have the option to reborrow the amount that you paid off. This is known as a top-up loan.
Additional options are also available for members. Some of them include a Payroll Loan and the second option is the Save as you Borrow Loan. Please note that the Payroll financing is only available through certain employers in Newport, so you will need to check to see if your employer is currently participating.
To request information on membership and any financing options available in the area, contact Newport Credit Union at 01633 214913.