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Credit Union's Credit Cards vs Bank's Credit Cards?

Valued Contributor

Credit Union's Credit Cards vs Bank's Credit Cards?

Are there any differences besides fees and rates or rewards? Mainly, I want to know:

 

1. Is a Credit Union Credit Card considered a subprime card or just not a main stream card?

2. Does it help to build credit scores the way just as a bank credit card does?

 

 

 

Message 1 of 12
11 REPLIES
Frequent Contributor

Re: Credit Union's Credit Cards vs Bank's Credit Cards?

I would consider credit union credit cards to be prime. I currently have two credit union Visa cards, and they report just like any other credit card. Yes, they do build credit. As far as rates and fees go, credit unions traditionally offer better interest rates on credit cards and often have lower fees should you be late making your payment. Plus, having a CU credit card builds a relationship with that CU, so if you need to apply for a mortgage or car loan, having a positive tradeline from them will help you there too. I can't think of any reason to have a bank card other than maybe one of the airline or hotel specific cards.

 

Relationship example: My lower interest rate Visa (9.75%) is from the CU that i've been a member of for over a decade, and have two positive paid in full loans with. The other card is from my other CU, of which i've only been a member since April. The interest rate on that one is 13.99%. Despite having a BK, CU #1 rewarded me for my past history with them.

Message 2 of 12
Valued Contributor

Re: Credit Union's Credit Cards vs Bank's Credit Cards?

Thank you USF813!

 

I was conserned about that the Credit Union's Credit Cards were not prime. You have helped me undersranding it better.

Message 3 of 12
Valued Member

Re: Credit Union's Credit Cards vs Bank's Credit Cards?


igitalark wrote:

Are there any differences besides fees and rates or rewards? Mainly, I want to know:

 

1. Is a Credit Union Credit Card considered a subprime card or just not a main stream card?

2. Does it help to build credit scores the way just as a bank credit card does?

 

 

CU credit cards/loans usually have much lower interest rates/fees than bank credit cards.  It's because as a CU member, you are a part owner of the credit union and so profits are retuned to you in the form of lower interest and no fees or reduced fees.  CU credit cards report to all 3 bureaus just like bank credit cards.  It's ideal to become a CU member of several CUs and then to obtain all your credit from them instead of banks whose business is to profit off of customers.  Banks' "reward" programs are simply banks charging poorer people high interest and fees and giving a tiny fraction of that to people who are better off and have better credit.    

 

Message 4 of 12
Super Contributor

Re: Credit Union's Credit Cards vs Bank's Credit Cards?


Arago wrote:

igitalark wrote:

Are there any differences besides fees and rates or rewards? Mainly, I want to know:

 

1. Is a Credit Union Credit Card considered a subprime card or just not a main stream card?

2. Does it help to build credit scores the way just as a bank credit card does?

 

 

CU credit cards/loans usually have much lower interest rates/fees than bank credit cards.  It's because as a CU member, you are a part owner of the credit union and so profits are retuned to you in the form of lower interest and no fees or reduced fees.  CU credit cards report to all 3 bureaus just like bank credit cards.  It's ideal to become a CU member of several CUs and then to obtain all your credit from them instead of banks whose business is to profit off of customers.  Banks' "reward" programs are simply banks charging poorer people high interest and fees and giving a tiny fraction of that to people who are better off and have better credit.    

 


And, if you are eligible for a bank reward card, you have to decide whether you wish to profit from this or not!  Because, in general, the only downside of the CU cards is that the rewards are usually less good than those offered by banks (because they make less in fees etc).  There are exceptions, such as the Penfed cards for gas are better than any bank equivalent, but in general, a CU will offer you a card with a lower APR but a less compelling rewards program.
Message 5 of 12
Super Contributor

Re: Credit Union's Credit Cards vs Bank's Credit Cards?

In general, I think the following:

 

1.  For lower interest rates and better terms, a CU is a better option.

2.  For perks, rewards, and sign-up bonuses, non-CUs are better.

 

There are exceptions, such as Pen Fed or Fort Knox's Gas card; but, in general, for credit cards, CUs just don't offer the kinds of rewards and benefits found in Amex, Chase, Citi, etc...

Message 6 of 12
New Contributor

Re: Credit Union's Credit Cards vs Bank's Credit Cards?


Open123 wrote:

In general, I think the following:

 

1.  For lower interest rates and better terms, a CU is a better option.

2.  For perks, rewards, and sign-up bonuses, non-CUs are better.

 

There are exceptions, such as Pen Fed or Fort Knox's Gas card; but, in general, for credit cards, CUs just don't offer the kinds of rewards and benefits found in Amex, Chase, Citi, etc...


I would also add that some CU's can very generous with credit limits which will help bolster higher limits from other cards.

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Message 7 of 12
Super Contributor

Re: Credit Union's Credit Cards vs Bank's Credit Cards?


GatorGuy wrote:

Open123 wrote:

In general, I think the following:

 

1.  For lower interest rates and better terms, a CU is a better option.

2.  For perks, rewards, and sign-up bonuses, non-CUs are better.

 

There are exceptions, such as Pen Fed or Fort Knox's Gas card; but, in general, for credit cards, CUs just don't offer the kinds of rewards and benefits found in Amex, Chase, Citi, etc...


I would also add that some CU's can very generous with credit limits which will help bolster higher limits from other cards.


Right, much easier to attain a higher CL with a CU than the other banks, where it can be very difficult.  Navy often starts their members with $15K CLs, whereas Chase would offer $1.5K.

 

Also, except for BofA, CUs are the only ones who offer the no fee, no forex, and EMV chip cards.

Message 8 of 12
Valued Contributor

Re: Credit Union's Credit Cards vs Bank's Credit Cards?

Than you very much everyone! You guys are so helpful!
Message 9 of 12
Valued Contributor

Re: Credit Union's Credit Cards vs Bank's Credit Cards?

I'm a big fan of CU CC's.  I have 3 of them sub 10% and the next one up is only 11.9%.  They comprise $44K of my total CL available currently.  You can't go wrong with a CU when it comes to getting higher limits than your average bank.  

Message 10 of 12