How to Narrow Down Your Choice of Credit Unions to Find the Right One for You

How to Narrow Down Your Choice of Credit Unions to Find the Right One for You

Credit unions offer many benefits over traditional banks. They typically offer lower interest rates on personal loans, mortgages and car loans, and they typically offer higher interest rates on savings accounts and investments like CDs and money market accounts. They are also considered to be customer-owned, so they usually have lower fees and - many would say - better service.

Like banks, unions have many options to choose from for your personal finance needs. Here are a few tips that can help you narrow down the field and find the right union for you:

Learn about Membership Requirements

Not all credit unions are open to the public. Many have requirements for membership. For example, you may need to work for a certain employer, or you may have to attend a certain school (or be employed by that school). Even if you don't meet these requirements, you may still find an "in." For example, some unions are open to family members of those who meet the requirements. Shop around and find out what's required for membership, then ask about any exceptions or loopholes that you may be able to take advantage of if necessary.

Ask about Services

Most credit unions offer a full range of banking services, but not all do. For example, you may not have access to a certain type of mortgage or certain types of investments. Some services may also require higher minimums, such as a savings account. You may also have to keep a minimum daily balance even in your checking account, whereas many banks will allow you to keep zero balance. It is worth understanding the services that the union offers completely before making the choice to open an account. You want to be able to reap the benefits of membership, and not feel restricted in your banking choices.

Find Out about Exclusive Benefits

Some credit unions offer exclusive products that you may not be able to get anywhere else. For example, the union might offer a special type of mortgage loan that has benefits like not requiring a down payment or private mortgage insurance. The union might provide access to special investment options such as 401(k) program that is typically only open to teachers. There are many possibilities. Thoroughly discuss the benefits of membership, then compare them to other unions to find out if you are making the best choice.

Ask for Referrals

If you know friends or family who belong to a union, ask for referrals. You'll get a feel for what unions offer the best service and the best products. You can then narrow down your choices based on what you uncover from your own research.

Credit unions can offer many advantages for banking. Make sure that if you make the switch, you choose the best union for your needs. These tips can help you narrow down the field and choose the right union for a long-term, successful banking relationship.