Low Cost Loans from your Credit Union

"Lewisham Plus Credit Union"

What can I borrow?

Lewisham Plus offers flexible loans for all types of purposes to its members. You can borrow small or large amounts over any period up to 3 years, with no fees, no penalty for early repayment and free life insurance (within policy limits).

The policy below describes the maximum amount which the credit union may lend. You should not borrow more than you can afford to repay. Lewisham Plus officers will assist you in drawing up a simple budget as part of the loan application and will need to see proof of your income in order to check that the loan you are requesting makes sense for you and for the Credit Union.

Lewisham Plus offers two types of loans, which are described below – Flexi-loans and Standard credit union loans.

Loans can only be made to adult members of the Credit Union over 18 years of age.

FlexiLoan - What you’ve been waiting for?

Up to £1,000 Flexi-loan Flexible access to cash – no fuss

If you need money fast but find it hard to save, our Flexi-loan could be the answer.
Standard credit union loans are great value, but are only available to members who have been saving for three months and are based on a multiple of your savings.

The Flexi-loan is different. Benefits are:

• No savings required – as long as you are a member
• Credit limit from £100 to £1,000 over three years
• Up to £500 instant access when accepted
• Quick top-up voucher for extra money
• Free life cover to age 75, subject to policy limits
• Easy repayment e.g. £5/week using a PayPoint card
• Low rate of interest - £2 per month on £100 borrowed

Download FlexiLoan Application (67.7kb)

Flexi-loan repayments table

*Loan cost excludes transaction fees where PayPoint is used.  PayPoint costs less than a bus fare and is much more convenient.

How to apply for a Flexi-loan

1. To qualify for a Flexi-loan you must become a member of Lewisham Plus Credit Union Ltd.  See separate application form:
   
   Download Membership Application (46.2kb)
   
2. You may apply for a credit limit up to £1,000 in £100 steps.
3. The initial cash payment is between £100 and £500.  If you don’t need all this at once, some can be put into your credit union savings and then withdrawn at a later date.
4. Proof of address must be shown when submitting an application - e.g. council tax bill, rent card/book, other official document or utility bill less than six months old.
5. Proof of income is also required - e.g. bank statements, last three payslips or letter indicating benefit entitlement.
6. Your Flexi-loan credit limit will be based on your ability to pay and any previous credit history.  Your credit limit will be reviewed after six months and may then be increased or reduced.  Your account will be reviewed after three years. 

Using your Flexi-loan account

1. After your Flexi-loan has been accepted, you will be issued with a book of Payment Request Vouchers for use when drawing down credit, up to your credit limit.
2. Quick top-ups to draw down further cash, in multiples of £10, are available after 2 months or 8 weeks, providing that you have made the minimum payments on time.
3. Interest is only payable on the outstanding balance of your loan, so the amount decreases with each payment made.
4. The maximum rate of interest is only 2% per month (26.9% APR) on the outstanding balance.
5. The minimum repayment is based on paying your full credit within about three years.  You may opt to pay more quickly, or add to your savings, whenever you wish.
6. If you use a PayPoint card to make payments, the bank transaction fee will be deducted each time, currently 35p, in addition to interest.  Your loan will cost more overall.
7. If you move address, your circumstances change or you experience difficulties in making repayments, you MUST contact the Credit Union to discuss making alternative arrangements.  We can be very flexible and always try to help where we can. However loans must be repaid.
8. If you do not keep up with agreed repayments we can take debt recovery actions.  These may include using debt collectors and County Court Judgements, which may affect your credit rating and others in your household.

Standard Credit Union Loans – low cost loans for savers

Standard Credit Union loans are granted at the low rate of 1% interest per month (12.7% APR). This is very competitive for small unsecured loans, and includes life insurance for no additional cost.

Check the small print behind the low headline rates advertised by high street lenders before you borrow elsewhere!

Credit Union interest is calculated daily of the outstanding balance of the loan. There is no ‘front loading’ of future interest payments, so you will always know where you stand. There are no charges for making additional early repayments and the faster you repay the loan the less interest you will need to pay. Loans applications are straightforward and are processed quickly for small loans and usually next day for larger amounts.

Most importantly, Lewisham Plus will never rip you off – we exist to serve our members for the good of the local community as a whole, not to make a profit for our shareholders.

It is not necessary to complete repayment of one loan before applying for a second loan to ‘top up’ your loan balance. Many of our members use this facility. Top up loans are subject to the same policy as other loans and where granted replace the terms of a previous loan.

Credit Union loans are subject to the decision of the Credit Committee, which shall be final. Lewisham Plus is under no obligation to make a loan and may offer a reduced amount or different repayment terms, or may refuse to grant a loan that is outside our policy or considered to be inadvisable for the member or too high a risk for the Credit Union.

Loans to members up to age 79 include free life insurance. This excludes death caused by pre-existing medical conditions during the first six months of the loan, and from AIDS. All insurance is subject to the limits of the policy written by CUNA Mutual Insurance Society.

Loans to members up to the age of 70 are covered up to £6,000. Loans to members up to the age of 79 are covered up to £3,500. As free life insurance is also provided on savings for members up to the age of 74, in most cases the savings life insurance provides a basis for insurance payment to clear a loan on death when an amount larger than £6,000, or £3,500 over age 70, has been borrowed.

Share withdrawals are not allowed when a loan is in arrears or in default. If your loan repayments are on schedule, you may withdraw shares but not reduce your share balance below half of your current loan balance.

Click here to:

• Download Loan Repayment Table (35.8kb)
• Download Standard Loan Application (32.3kb)
• Download Standing Order Mandate (6.5kb)
• Download Loan Terms & Conditions (22kb)

Level 1 Loans

After joining the Credit Union and saving as a member for 3 months, making at least 3 share deposits in that time, you can apply for a Level 1 Loan. Members who have saved for a longer period may be eligible for a Level 2 loan. Level 1 loans are only available to members who have no history of loan default within the previous 6 months.

A Level 1 loan can be granted up to a maximum of two times your savings, or savings plus £500, whichever is the smaller. For example, if you have £400 in savings you could apply for a Level 1 loan up to £800. If you have £600 in savings you could apply for a Level 1 loan up to £1,100.

Level 2 Loans

After joining the Credit Union and saving as a member for 12 months, making at least 6 share deposits in that time, you can apply for a Level 2 Loan. If you have already had Level 1 loan and kept up regular repayments over 26 weeks or 6 months you can apply for a Level 2 loan after 6 months, for instance to top-up the existing loan balance. Level 2 loans are only available to members who have no history of loan arrears within the previous 6 months or loan default within the previous 12 months.

A Level 2 loan can be granted up to a maximum of three times your savings, or savings plus £2,000, whichever is the smaller. For example, if you have £400 in savings you could apply for a Level 2 loan up to £1,200. If you have £1,500 in savings you could apply for a Level 2 loan up to £3,500.

Level 3 Loans

Level 3 loans are only available to members who have previously repaid a loan at one of the lower levels.

If you have had a Level 1 or Level 2 loan and kept up regular repayments over 52 weeks or 12 months you can apply for a Level 3 loan. Level 3 loans are only available to members who have no history of loan arrears within the previous 6 months or loan default within the previous 18 months.

A Level 3 loan can be granted up to a maximum of four times your savings, or savings plus £3,000, whichever is the smaller.  Larger amounts may be permitted in exceptional circumstances. For example, if you have £600 in savings you could apply for a Level 3 loan up to £2,400. If you have £3,000 in savings you could apply for a Level 3 loan up to £6,000.

As Level 3 loans are typically for larger amounts, the Credit Union will require you to set up a standing order to repay a Level 3 loan. A Level 3 loan will not usually be granted to a member with a County Court Judgement for previous failure to repay a debt.

Convenient ways to repay a loan

1. Visit your local collection point or our Main Office.
2. Use a standing order to make regular payments.
   
   Download Standing Order Mandate (6.5kb)
   Complete this form and take or send to your bank or building society.
   
3. PayPoint card accepted at more than 8,500 outlets country-wide. To request a PayPoint card, contact our Administrator
4. Payroll deduction from participating local employers.

What happens if you don’t keep up repayments?

Your loan will be in arrears if you miss one agreed repayment and in default if you miss 3 or more repayments. E.g. a loan with monthly repayments granted on 12th Sep is in arrears if no payment has been made by the 13th Oct and in default if no payment is made by 13th Dec.

Allowing your loan to get into arrears or default may limit your future borrowing. The Credit Union will send you a letter if this happens setting out the consequences of not making the payments you have agreed.

Lewisham Plus Credit Union is a community-oriented service organisation run on a not-for-profit basis. We try hard to be flexible to help our individual members and can often agree an alternative repayment schedule if your circumstances change. However we have a duty and legal right to recover monies borrowed as these are the savings deposited by others of our members.

We can, and where members have been uncooperative on occasion have used any of the following methods, which are listed as examples without limitation:

• A member in default will become liable for any additional costs such as court fees.
• Enforced transfer of savings to repay arrears or the entire loan.
• Collection of the loan by a registered debt recovery agency.
• Recovery of the loan by bailiffs.
• A County Court Judgement for failure to repay the loan.
• A charge against the property, if the member in default is a home owner.

What happens if circumstances change?

Sometimes circumstances change and make repayment of a loan difficult, due to loss of a job for example. Lewisham Plus always tries to be flexible in these situations and is usually able to re-schedule and reduce loan repayments at no charge. However, you must let us know as soon as you are in difficulty in order to avoid loan arrears developing. Please either telephone, call in or write if you are having problems and we will do our best to help. We only take recovery action against people who are unwilling to cooperate with us or repeatedly break their promises or agreements with us.

How to apply for a loan

Step 1
Pick up a Loan Application form at a collection point or contact Lewisham Plus by telephone or email and we will send you one by post, or download it from one of the links on this page.

Step 2
Work out your monthly budget by completing the back of the loan application form. Estimate what repayments you can afford.

Step 3
Decide how much you need to borrow, then check the Loan Policy (see above) to see whether you will qualify for this amount.

Step 4
Complete the front of the loan application form and either bring it to a collection point or post it to our main office address.

Step 5
For a Level 1 loan up to twice shares or shares plus £500, (whichever is smaller), come to see a Loans Officer at your local collection point or at our main branch.

For Level 2 or 3 loans, post or hand in your completed loan application form in advance and make an appointment to see a Credit Committee representative. Appointments can be made via the Administrator. Larger loans will need to be approved by the Credit Committee.

Step 6
When you come to arrange the loan you need to bring evidence of your income for the last 3 months (e.g. wage slips, benefit and pension books), a recent proof of address (e.g. utility bill) and your Lewisham Plus Credit Union Ltd passbook.