General information

Q What is a Credit Union?
A Credit Union is a not-for-profit financial cooperative, set up and controlled by its members in order to benefit their community.

Q Who runs Highland Communities Credit Union?
Highland Communities Credit Union is run by a board of directors. These are volunteers who are elected by the membership at the Annual General Meeting. The Board sets all the policies and procedures of Highland Communities Credit Union, decides how money is spent, and how HCCU should proceed in the future.

Additionally, HCCU has a Supervisory Committee and the Credit Committee who are elected at the AGM. The job of the Supervisory Committee is to ensure that all officers of the credit union are acting in accordance with the law, the Rulebook and the agreed policies and procedures. The Credit Committee on the other hand decides all loan applications.

Q Who can join Highland Communities Credit Union?
Only those working or residing within the Highland region can join Highland Communities Credit Union, provided they agree to abide by Highland Communities Credit Union’s rules. However, members who move outside the common bond may retain their membership at the discretion of the Board.

Q Does Highland Communities Credit Union have any connection with other Credit Unions?
Credit Unions are owned and run by their own membership, therefore in this respect they are independently run. However, Highland Communities Credit Union is affiliated with the Association of British Credit Unions Ltd (ABCUL) in order to benefit from:

  • Government influence
  • Insurance benefits
  • Credit union paperwork and promotions
  • Training
  • Exchange of ideas with other credit unions
  • Participation in the ABCUL AGM

Q What are Highland Communities Credit Union’s aims?
Our Mission Statement is as follows:
Highland Communities Credit Union aims to provide a local savings and borrowing facility responsive to the needs of the members and to strengthen our community by working together.

  1. Promotion of thrift among its members by the accumulation of their savings
  2. Provide sources of credit for the benefit of its members
  3. The use and control of members’ savings for their mutual benefit
  4. The financial education of members

Q Is Highland Communities Credit Union regulated?
Highland Communities Credit Union is authorised by the Prudential Regulation Authority (PRA) and regulated by the Financial Conduct Authority (FCA) and the Prudential Regulation Authority. We are also a member of the Financial Services Compensation Scheme (FSCS) and the Financial Ombudsman Service (FOS). Our Firm Reference Number (FRN) is 213955.

Q Are there any membership fees?
Yes. There is a £5 administration fee charged every year at the end of September. We charge this due to the fact that we are a small, not-for-profit organisation.

How does it work?

Q Are members expected to save regularly?
Yes. Credit unions encourage members to save regularly, even if you can only afford a small amount. By saving regularly, not only do you develop a cushion against sudden changes in circumstance but you also show the Credit Committee that you can put away a regular sum of money, and are therefore more likely to repay a loan.

Q How can I save?
You can deposit money by standing order, bank transfer, internet banking or at one of our collection points. Should you require a standing order mandate please click here.

Q How much should I save?
Members can save as much or as little as they want, when they want, however we would strongly encourage you to save as much as you can at least on a monthly basis, as the more that you can save, the stronger your financial position will become.

Q Can I withdraw my shares at any time?
Normally it will take a couple of days to process a share withdrawal, but in some circumstances it may take longer so it is always best to plan ahead when you are wanting to make a share withdrawal.

We would advise you to keep in mind that HCCU provides life insurance on your shares (terms and conditions apply), therefore should you wish to withdraw a large amount of your shares we would recommend that you take out a secured loan.

Loans

Q Can anyone get a loan from Highland Communities Credit Union?
All members over the age of 18 can apply for a loan.

Q How soon can I borrow?
You must have been saving regularly for 3 months before you can apply for a loan.

Q How much can I borrow?
You can apply for a loan of up to three times the value of your shares to a maximum of £10,000.

Q What can I get a loan for?
Loans must be for a provident and productive purpose. This can include:

TVs; cookers; fridge freezers; furniture; car tax/insurance; carpets; footwear; holidays; cars; electricity bills; telephone bills; car repairs; fuel; garden sheds; decorating; house repairs; TV licences; Christmas; school expenses; tools; washing machines; dental/medical bills.

We acknowledge that each member has their own priorities and that the list above is not exhaustive.

Q How much will it cost me and how is interest calculated?
Highland Communities Credit Union charges interest daily on the decreasing balance of the loan. For unsecured loans under £5,000, interest is charged at 1.75% per month (23.1% APR).
For unsecured loans over £5,000 interest is charged at 1% per month (12.7% APR).
For secured loans interest is charged at 0.5% per month (6.7% APR).

When the Credit Committee calculates your repayment amount, they take into account the interest that will be added on. This way, you make the same repayment throughout the whole period of your loan. This repayment covers the amount of money that you borrowed, and also the interest due.

Should you wish to pay off your loan balance in full you may do so at any time. You will NOT be charged an early repayment fee, and your loan will cost you less, as you will only have been charged interest on your balances up to the date of repayment.

Q When do I start paying interest on my loan?
The first interest will be added onto your loan balance on the day your loan was granted and will decrease from there.

Q What will the Credit Committee do?
The Credit Committee is comprised of volunteers who meet once a week to consider loan applications. When the Committee receives your application, they will verify that you have completed the application form correctly. We will contact you should the need to clarify any details arise.

The Credit Committee will look at how much available income you have to see whether or not you can afford the repayments. This helps to ensure that members do not take loans that they cannot afford to repay, and by doing so, safeguards members’ savings. Remember, you are borrowing the savings of other members!

The Credit Committee will also consider whether the length of the loan is acceptable. To decide this, they will look at how regularly you will have this expense, for example:

  • A loan to pay an electricity bill should be paid back within 3 months, as you will receive another one in 3 months’ time.
  • A holiday should be paid back within one year, as it is likely that you will want another holiday again next year.

It should be noted that these are simply guidelines – you will not necessarily be refused a loan for a holiday just because you want to pay it back over 2 years. However, you may be asked to consider how you will pay for a holiday next year.

Q How long will it take to get a loan?
Normally loan applications are processed and paid out within one week of applying. However, in some circumstances this may take longer, so please try to plan ahead when applying for loans.

Q What is a secured loan?
A secured loan is when you borrow an amount less than or equal to your shares. Some benefits of taking a secured loan are:

  • Keeping your savings intact
  • Your savings are insured, as is your loan. For example: if you had shares of £1,000, and you withdrew £500, then should you die, your nominee would receive approximately £1000 (your £500 savings plus a like amount in insurance). However, if you had borrowed the £500, your savings of £1000 would be doubled to £2000, and your loan would be paid off
  • Never borrowing above your capabilities – you will always have enough savings to cover your loan should you need to pay it off immediately
  • Building your credit score

Q Is it best to borrow for one item at a time?
Yes, this is always the best way to borrow (if possible). You can clear one item more quickly than two or three and you will be charged less interest.

Q If I have an outstanding loan balance, can I borrow more money?
Yes – this is known as a top-up loan. When a top-up loan application is considered, the Credit Committee will take into account the outstanding loan balance as well as the amount that you would like to top up. For example, if you have a balance of £200, and you would like to borrow another £500, the Credit Committee will treat it as a new loan application of £700.

As a general rule, the Credit Committee would like you to have repaid a substantial amount of your current loan before they consider a top-up loan.

Q What is a loan agreement?
A loan agreement is a legal document which outlines the terms of your loan. It contains details of the amount borrowed, the date of the first repayment, and the estimated finish date (assuming that you make each repayment as agreed).

By signing this document, you agree to the terms set out in the agreement, including the repayment amount and frequency.

Two signed copies of the agreement are printed and signed – one for you and one for HCCU.

Q What happens if I fall behind with my repayments?
If you fall behind, then we will send you a reminder in case you have overlooked your repayments.

Whilst Highland Communities Credit Union recognises that in some situations falling behind with your repayments is unavoidable, if you fall behind with repayments you should try to catch up as soon as possible, otherwise you will be paying interest on a balance that is higher than was expected. If you fall into difficulty, it is vital that you contact Highland Communities Credit Union as soon as possible. We may be able to renegotiate your loan or refer you to other avenues of help.

Please note that continuous nonpayments will result in your account going into default, which may affect your credit score.