Credit unions have been around for years, but people still wonder exactly how they work, and if they can get the same features and benefits of a big bank. The answer is yes. Most credit unions not only offer every product you can find at a bank, they usually offer it at substantial savings. Let's not forget better service, too.
Banks are owned by shareholders, like any other company trying to make a profit. In order to make that profit, they need income. That comes from the high rates you pay on loans through them, or the fees you're assessed for using savings or checking accounts, or credit cards. Even deceptive totally-free offers usually come with unexpected fees later on, and limiting conditions.
At a credit union, you are the shareholder when you become a member. You'll be asked to keep anywhere from $5-$25 in a share-savings. This is your share and you are now part owner. But since credit unions are inherently non-profit, all those funds that are normally generated must be funneled back to you. There are fewer and smaller fees, and often much more leniency in refunding them. More money for training new employees and keeping talented financial advisers on staff results in more knowledgeable service. You can get higher returns on your deposits, and you can get some of the best rates on the market for loans.
Now it used to be that credit unions were smaller, and didn't have the resources to offer the same products as banks. These days, membership eligibility often includes the populations of whole cities and counties. Some boast assets of several billion dollars. This means plenty of capital for your auto loans, boat loans, or RV loans with uniquely low interest rates. You can get first and second mortgages with low closing costs and extremely competitive rates. You can even look to your credit union for great rates on mobile home and cottage loans.
These benefits seem too good to be true, but remember, you are not just a customer anymore. You're a member. You can even vote in major credit union decisions because the board of directors is simply a selection of fellow members just like you. The recession had a rough impact on banks and as a result credit unions have been flourishing.
They've grown only more secure. And this security has trickled down to its members. You no longer have to fear for the economic strength of your financial institution. Credit union members can relax and enjoy the summer fun. If fun includes a cottage or speedboat, at least you got a killer deal to brag about on the beach.
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Article Added on Saturday, September 4, 2010
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