As a community co-operative Hoot is committed to offering products and services that help members manage their money and build up a history of good money management. Being a Hoot Credit Union member means you are part of a community that encourages good money management, active saving and responsible borrowing.
Sometimes just by making some simple changes you can free up enough money to start saving or to be able to afford loan repayments.
It is important also that you contact us if you are struggling to pay your Hoot loan. Getting help and support is the best way to relieve the stress of money worries.
Here is some useful information that will help you to make the right financial choices and manage your money better.
Are you borrowing what you need rather than what you can?
Is what you want to spend the money on essential? Could you wait and save for what you want? Better to ask what you need to borrow than how much you can borrow.
How long will it take you to repay the loan?
Longer term loans with lower repayments might cost you more in the long run. Choose the shortest term that you can and manage the repayments.
How much will it cost each week or month?
Your repayments will depend on how much the loan is for, how long you agree to repay it over, the agreed interest. You should make sure that by taking out the loan you are not overstretched and can afford the repayments.
Add up all of your weekly or monthly income, then all your outgoings (rent, bills, food etc). Subtract one from the other. Is the remainder enough to make the loan repayments?
What interest will you pay?
Your loan repayments will include interest payments (This is called Cost of Credit) and is the amount you pay as your charge for getting the loan. Add this amount to your original loan and this is what you will repay altogether. Unlike most lenders, a Hoot loan charges interest on the reducing balance. This means that, instead of front-loading the interest onto your loan, interest is charged daily on the reducing balance; so you pay back less in the long run.
Are there any extra charges?
Many loan companies will charge you if you make a late payment or pay your loan off early. Some also charge a setup or admin fee. With a Hoot loan there is no setup fee, early repayment or late payment charges. I fact, if you pay your loan off early you will save on interest!
Look at the amount you repay in total. Not just the APR%
Interest is usually expressed as APR%, which stands for ‘annual percentage rate’ and includes any fees and charges on the loan. You can use APR to compare similar loans because it gives the interest rate of the loan as if you are paying it over a whole year. The interest, plus charges is stated as ‘Cost of Credit’
Make sure you compare like with like
APR% will help you compare loans but you should remember to compare only loans that you would be eligible to get. For example, if you have a poor credit history, comparing with a bank loan with a low APR% that you would need an excellent credit rating for, wouldn’t give you a true picture of what your options are.
Consider the lender
Are you sure that they are a responsible lender that treats you as an individual? Are all their decisions automated or will they look at your particular circumstance to consider whether a loan is right for you? Credit unions are member focused lenders that put your needs before profit.
We know that from time to time people may struggle with money because of the demands of everyday life. Loss of your job, unexpected expenses or other circumstances can sometimes overwhelm you and cause worry and stress about how you can keep up with payments. Sometimes we know that it is a short term problem and you just need a little time to get back on your feet.
Talk to us
Credit unions value their members and are here to help so we dislike taking any kind of action with regard to people who cannot pay their loan. The money you have borrowed comes from the savings pot of other members. We therefore have a responsibility to help you to pay us back. If necessary we will use debt recovery or court action.
You should remember that, if you do not repay your loan, your credit rating will be affected and you will find it harder to get credit. Not only does it add more costs to your debt but can affect you for years into the future when you apply for credit, mobile phone contracts, car finance, opening some bank accounts or even passing pre-tenancy checks when you want to move house.
We may be able to help
It is important that you contact us straight away if you are struggling with your loan repayment. It is better to talk to us as soon as you can so don't be embarrassed about contacting us. We will be happy that you have contacted us to put things right.
If you have tried to bring your household finances under control but are struggling to make it all add up; don’t ignore it. There are places you can go and people you can speak to help you manage your money.
Having trouble paying your Hoot loan?
Contact us straight away.
Do you need support and want someone to help you to manage your money or have so many debts you don’t know who to pay and when?
Do you feel that you can’t seem to cope with it all and are feeling stressed and ill because of it?
Make an appointment with your GP or go online to www.nhs.uk and type ‘money worries’ into the search box for advice.
Do you want to know where you can go to help you save money?
Keep a spending diary – write down everything you spend in a month including bills, cash spending and anything spent on your credit or debit card. Having a true picture of what you spend will help you to make changes. Download our useful budget planner.
Check your bank statements - You may be surprised at how many services or subscriptions go out of your account by direct debit every month that you don't use — or need
Check your credit score - Check your credit report to see if there are any mistakes or if you’ve been a victim of fraud.
Deal with your debts - If you are feeling worried or ashamed about speaking to someone about your debt you are not alone. 41% people admit to not feeling able to get help. There are debt management charities that will not charge you for helping you manage your debt.
Look for money saving ideas – There are lots of websites offering money saving tips and discounts. These range from ways to reduce your energy bills, save money on food purchases and ways to boost your income.
Check you are claiming all the benefits you are entitled to – You can find out what is available and try a benefits calculator at www.gov.uk/browse/benefits/entitlement.