I need a personal loan but have a poor credit score, can a credit union help me?

To become a member of a credit union, you must share a common bond with other members, such as working for the same employer or living in the same area.

There are over 100 credit unions currently operating in Scotland, with around £200m in savings and £170m presently loaned to customers. Recently, the Scottish government’s Third Sector Enterprise Fund invested more than £1.3m into Scottish credit unions, which improve services and also encourage them to thrive and expand their customer base. Credit unions are also regulated by the Financial Services Authority, to ensure your money stays safe.

What happens if you take a loan from a credit union?

When you take out any loan, often there are hidden charges. If you’re lucky enough to be able to pay the loan back in full before the end of the agreed term, there are often penalties too. Borrowing from a credit union is different: there are no penalties for paying a loan early and no hidden charges either. Interest rates can vary, so if you’re unsure, it’s best to speak to a financial advisor before committing to anything, who, if it’s right for you, can then advise on how to apply to a credit union.

Usually, the length of a loan with a credit union is around five years (unsecured) or ten years (secured). For more information on what constitutes a secured or unsecured loan, why not contact our friendly, impartial team at Scotland Debt Solutions for confidential advice on what type of loan suits your personal situation.