Vale of Leven Credit Union warns of loan sharks

Nov 28 2008 by Amanda McKendrick, Lennox Herald (main ed)

FAMILIES struggling to pay for Christmas because of the credit crunch are being urged not to fall prey to money lenders.

Vale of Leven Credit Union has called on anyone with money problems to turn to them for financial help rather than seeking any other unscrupulous sources of cash.

Cathy Greig, manager of Vale of Leven Credit Union, said: “Come and speak to us or any other credit union first and put your case forward.

“At this time of year we do allow new members to take out small loans to keep them away from money lenders, legalised or otherwise.”

The credit union in Bank Street, which offers members low cost loans and the opportunity to save, admits even it is feeling the effects of the global financial crisis.

Cathy added: “We have had an increase in people coming back to renegotiate the terms of their loans because they have been finding their repayments a wee bit steep just now.

“Historically it is a bad time of year for payments as the money people do have they will tend to use for Christmas, but I think people are loathe not to pay us because of what we are.

“Loan write-offs, which are never good, are much the same as last year but more people are lifting their savings instead of taking a loan, so there is a reduction in savings.

“I think people are being a wee bit more canny this year. We have been quite busy with loans for our well established members but they are taking more advice on repayments and I think a wee bit more sense is being applied.

“We stipulate that all Christmas loans have to be cleared in a year because we don’t want people still to be paying for this Christmas when the next one comes around.”

The credit union experienced a surge a membership after it offered loans to those who lost cash when Farepak Hampers collapsed in 2006 and most of those have continued to save their cash with the Alexandria organisation.

Cathy added: “We hope people will be sensible at this time of year and not borrow more than they can afford.

“When people are applying for loans we are looking very closely at their income and expenditure, making sure they are not over-extending themselves and, come February or March, causing them and us stress.”