Good reasons to join a credit union

Credit unions are not-for-profit financial cooperatives owned and governed by their members, making them different from commercial businesses in their operation and their philosophy of placing members’ needs first.

This “member-first” approach translates into better rates on savings accounts and loans, lower fees and higher levels of service. Consider these distinct advantages to becoming a member:

• Low minimum balances. Credit unions generally require a very modest minimum balance to open an account.

• Better rates of return on savings. Credit unions provide higher interest rates on basic savings (share) accounts, interest-bearing checking accounts and CDs. Many credit unions also pay “bonus” dividends if the credit union has a good year.

• No- or low-fee checking accounts and ATMs. Many Americans spend hundreds of dollars a year on checking account fees, often because they can’t meet minimum balance requirements. Credit unions give their members a break by assessing no fee or a much more modest fee than typically charged by large banks. Credit unions also have lower ATM charges and sometimes are connected to surcharge-free networks.

• Lower interest rates on credit cards and loans. This may be the biggest advantage to young military families who are just getting started and need to stretch their dollars as much as possible. From credit cards to car loans, credit unions consistently offer lower rates, better terms and lower fees. DataTrac, a national interest rate-tracking service, finds that rates on car loans offered by credit unions average 1.5 to 2.0 percent lower than banks.

• Accounts insured by the U.S. government. Credit union accounts are insured up to $100,000 by the National Credit Union Share Insurance Fund, just as the FDIC insures bank and thrift deposits of up to $100,000. Some credit unions also offer additional private, supplemental coverage up to $250,000 per account.

• Competitive mortgage rates and equity loans. More credit unions are offering extremely competitive interest rates on home mortgages, equity loans and lines of credit. Not only are the rates low, but closing costs generally are much lower than those paid through a conventional lender.

• Credit counseling. Credit unions know that it is sometimes difficult for military families to meet their obligations, so they have established extensive programs to help their members get back on their feet.

• A voice in your credit union’s operations. As a member-owner of your credit union, you are entitled to vote on credit union business and elect new board members. You can also serve on your credit union’s volunteer board or one of its committees.

• Once a member, always a member. As long as you maintain an account, you will always be a member of your credit union. Most credit unions today offer any number of services online or by telephone, so convenience is maintained.

• Community outreach and service. Among the many special services credit unions provide are financial counseling, first-time loans to members with credit problems, low-cost alternatives to check cashers and payday lenders, and outreach to unde-rserved neighborhoods.

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