1. All members of the Credit Union shall be eligible to apply for a loan from the Credit Union after they have completed 13 weeks of regular saving. A loan will not be given on the basis of a sudden increase in shares.
2. The availability of loans and the ratio of loan to shareholding shall be adjulsted from time to time to adequately make use of accumulated savings for the mutual benefit of all the members.
3. All loans shall be applied for using the Credit Union’s approved loans application form which shall be easily available to all members. Loans must not be applied for to service a loan from another lending institution such as a bank or building society.
4. Loans application forms should be fully completed, if necessary with the help of a member of the loans committee or other competent member. Tellers on duty should not have to leave their posts to assist members with the completion of loans application forms.
5. Members should be made aware that their loan will be processed within 14 days in normal circumstances and, if approved, will be paid out during the following week’s business.
6. All loans will only be paid out by cheque with the relevant member collecting it IN PERSON, and signing a receipt for same.
7. The member must be made aware of the repayment schedule and the rate of interest to be applied (12.68%APR or 1% per 30 day month).
8. Loans must be repaid as frequently as promised on this application form and must be for the minimum amount stated, although more can be repaid if desired.
9. There shall be regular meetings of the loans committee which shall be enabled by the Treasurer to view details of such account as is necessary in order to take decisions with sufficient information.
10. The loans committee shall be made up of 5 members. All decisions shall be by simple majority vote. The minimum number eligible to form a quorum shall be 3 and in this case all decision shall be unanimous.
11. The loans committee shall appoint from amongst their number a chairman and a secretary. Minutes shall be kept of all business in a secure book designed for the purpose.
12. Loans meetings should take the following format:
(a) Ascertainment of a quorum
(b) The appointment of a chairman for the meeting (in the absence of the regular chairman)
(c) The approval of the minutes of the previous meeting
(e) A report of loans issued since the last meeting
(f) Approval of new loan applications
(g) Arrears report
(h) Approval of arrears action
13. The loans committee should meet weekly if possible but at least twice monthly and the chairman should ensure that a report of their business is available for the next regular monthly meeting of directors.
14. The members of the loans committee should take great care even in very trying circumstances to keep the business of members using the credit facilities strictly confidential.
15. If a member finds difficulty in repaying a loan, then he/she should immediately inform the loans committee so that mutually acceptable alternative arrangements can be made. “Courtesy, Care and Consideration” should work both ways.
16. The loans committee shall ensure that a regular analysis is made of any loans of which the repayments are in arrears. This analysis should be in depth with the aim of identifying at the earliest stage the formation of a “bad debt”.
17. The maximum amount that can be loaned legally is £15,000.00 above the member’s shareholding.
18. The unsecured part of any loan shall not exceed 5% of the credit union’s total shareholding/assets.
19. Regular borrowers shall have a maximum loans/share ratio of 3/1. You cannot withdraw shares lower than this level (ie 3/1).
20. The final decision on any loan application is at the discretion of the Loans Committee.