9 Reasons to Love Credit Unions (And Not Big Banks)

5. Credit card offers

The NCUA also indicated that the average interest rate for credit cards was 11.55 percent for credit unions and 12.89 for banks. So there isn’t much of a difference in terms of APR, but the plastic from credit unions are usually less costly in terms of fees.

6. Borrowing

Been turned down by all the major banks? Try your local credit union. Its borrowing standards are likely to be more flexible, and they may be willing to work with you, especially if you are a member in good standing. And if you’re self-employed, you already understand how tough it can be to be approved for anything with major banks.

Credit Unions are also a great source for car loans. Check out the car loan search in our Solutions Center. It’s populated entirely by credit unions and you’ll find rates as low as 2 percent.

7. Earnings on savings accounts

Interest rates on savings are low across the board right now. Credit union savings accounts generally fare a little better than those in major banks, but this margin, again as of June 27, was extremely modest. Credit union savings accounts yielded earnings of 0.13 percent on average, while banks earned 0.12.

8. Customer service

The credit union may not have a 24/7 customer service line for you to call at 2 a.m. when you have a burning question about your account, but rest assured that the focus will always be on you. The credit unions I’ve joined have been staffed by friendly representatives who knew me by name. I can’t say I’ve had that experience with banks.

Also, there’s no need to worry if your card is lost or stolen, because there is typically an after-hours hotline you can call to report it.

9. Insurance

You can rest assured that your funds are safe in the credit union’s hands. Similar to most major banks, all accounts are federally insured up to $250,000 and backed by the U.S. government.

What if I want in?

Credit unions usually serve individuals affiliated with a particular organization or geographic region. But this doesn’t necessarily mean you won’t be able to slip through the cracks. To search for a credit union in your area, take a look at:

For another great source for information on mortgages, car loans, credit cards and more, check out our Solutions Center section on Credit and Debt.

Do you prefer credit unions to banks? Let us know in the comments below or on our Facebook page.

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