Banks, by their very nature, are seen as too impersonal and insensitive to its customers’ needs, not to mention the high rates they impose on loans and other fees. It’s no wonder then that alternative institutions have sprouted, providing services that also allow people to save money.
A credit union certainly fits the bill, and it has become quite successful that you can find them across the country and the world, offering different financial products. Today, you can apply for a used car loan from Wasatch Peaks Credit Union in Ogden, whose residents fully trust their community-based credit union.
Credit unions have indeed gotten the reputation as a better alternative to traditional banks, and just as safe. Some have gotten quite popular that people have nominated them in the list of best credit unions.
So what brought them to such a lofty position? We list a few of their advantages over traditional banks that appeal much to people.
More bang for your buck
As a financial cooperative, which means they are owned and operated by its members, credit unions can offer higher interest rates on savings and checking accounts, as well as the money market.
Less expensive financial products
This means lower loan and credit card rates, which makes it more appealing to people to use them to buy a car. Mortgages, personal loans, and credit cards tend to have relatively low APRs.
Low or no fees
Credit unions often don’t charge withdrawals, checks, or electronic transactions. They also have checking accounts that need no minimum balance and monthly accounting servicing charge. Although they will penalize bounced checks and overdraft fees just like traditional banks, this is usually at a lower rate.
Customer is king
Because credit union members, who have equal votes in any decision making, are also the clients that the institution serves, it can only be expected that rates and fees remain low while customer service gets high.
Unlike banks that will reject your loan or credit card application when your credit history has had issues, credit unions will be more willing to give you a second chance.
Most credit unions have simple terms for their savings and checking accounts, and won’t charge for deposit, debit card purchase, and even check withdrawal. Again, it’s because their clients are also their members, so they have a better understanding of their customers’ needs.
So, when faced with the choice of opening an account with a traditional bank or a credit union, would you still have a tough time making a decision?