The St. Joseph's difference A lot of members still (wrongly) think that in order to qualify for a particular loan at St. Joe's, you need to have at least a third in savings / shares. This is a myth!
Last year, we wrote about Peter. He had a credit union account at St. Joe's but since he was just starting out in life, had very little in savings, about €1,000. So, Peter was told by his friend that the most he could borrow was 3-times the amount he had in his savings, or about €3,000. This was inaccurate! In the end, Peter was able to borrow €30,000.
Recently, we came across another case of mistaken facts when it comes to loan calculations. Sandra was on the lookout for a new car. And she had been doing her homework to make sure that she was well prepared to have the cash on hand before she talked to any of the area car dealers as well as the finance options. She was also aware of the details of how PCP actually worked and how the CCPC was investigating whether or not consumers were aware of the full and final cost when using the PCP options.
She had a lot of concerns since she was one of those people that liked to own what she paid for and with a PCP, she would be making lots of payments but none of those payments would mean that she would own her car under a normal PCP contract.
Sandra needed to borrow €22,000. Much like Peter, she's had an active account at St. Joe's. Her account held a little more than €750. And again, like Peter, she had (wrongly) assumed that the maximum she could borrow was €2,000. In Sandra's case, it was her mum that alerted her to an article she had received from St. Joe's on lending guidelines and how St. Joe's has changed the way they assess loan applications. Instead of the old 'savings multiple' formula, which is basically the old 3-times-savings rule (borrow three times what one has in savings), today, St. Joe's applies a debt-service ratio.
Sandra wasted no time. She visited the St. Joe's branch at Dublin Airport and talked to one of the staff about her borrowing needs.
As with all loans, Sandra was asked to supply standard loan application details including income verification and a good personal credit report. Her loan application was approved within a day. This gave her a lot of flexibility to shop around and even push for the best car deal local dealers were prepared to offer. Plus, with competitive car loan rates, Sandra hooked a great deal and kept her finance costs low!
It was another case of the member that almost missed a great car deal due to some very out-of-date facts.