Why are Credit Unions recommended so much?

[Anonymous]

I read a lot of financial oriented forums giving praise to Credit Unions.  Yet everytime I check out a CU I find the offerings are mediocore at best and I can do better elsewhere.

Are they designed for people just starting their credit journey?  Is that why I'm not finding any real benefit?

[rbentley]

---

@Anonymous wrote:

I read a lot of financial oriented forums giving praise to Credit Unions.  Yet everytime I check out a CU I find the offerings are mediocore at best and I can do better elsewhere.

Are they designed for people just starting their credit journey?  Is that why I'm not finding any real benefit?

---

I don't think your experience is typical.  CU's are owned by their members not by their shareholders.  Thus they are usually more attentive to their customers and offer lower rates on CC's and loans. They typically have much lower fees and often offer free checking, without the need for DD or minimum balances that the big banks impose. I think it is hard to beat NFCU.  PenFed has been excellent also.  My local brick and morter financial institution is a credit untion.  They are definantely NOT just a starter bank.

[Glen_M]

Generally speaking, banks are businesses who want to make money off you, so they can pay dividends to the people who own stocks in that bank.  They want to reap profits from you in a variety of ways, like lots of little fees here and there for mundane transactions, higher interest rates on loans, lower rates on deposits, etc.  

Credit unions are owned by the people who make deposits there, and their first goal is offering services to those people and their community.  They will typically offer lower interest rates for lending, and charge fewer/lower fees, and give higher rates on deposits. 

A large credit union will be indistinguishable from a typical bank in the range of services they can offer.  Small or local CU or banks can both vary wildly.

[Shooting-For-800]

As with banks, credit unions vary dramatically.

Not too many mainstream banks offering $25,000 8% credit cards to people with 650 fico scores.

For some profiles, banks are better.  For other credit unions are.

For me, it completely depends on the product and lender.

[Anonymous]

---

@Anonymous wrote:

... Are they designed for people just starting their credit journey?  Is that why I'm not finding any real benefit?

---

I think you are not looking hard enough. Or well enough. 

[Anonymous]

---

@Anonymous wrote:

I read a lot of financial oriented forums giving praise to Credit Unions.  Yet everytime I check out a CU I find the offerings are mediocore at best and I can do better elsewhere.

---

Good replies from everyone above so far.

Can you comment on the specific credit union(s) that you've looked into and what "offerings" you're referring to that weren't competitive?  When you say you could do better elsewhere, specifically where/who beat the CU(s) for what products?

[Anonymous]

---

@Anonymous wrote:

---

@Anonymous wrote:

... Are they designed for people just starting their credit journey?  Is that why I'm not finding any real benefit?

---

I think you are not looking hard enough. Or well enough. 

---

So you're not going to suggest where to look?

[Anonymous]

Andrews Federal

PenFed

Fort Knox

[Anonymous]

It depends on the services you need.

NFCU has one of the easiest to get low-APR cards around (as long as you have military affiliation in your family), checking with free name-only checks and no minimum balances, great rates on multiple types of loans, and the shares-secured loan that can be a real credit boost for people who don't have any installment loans.

SDFCU has a 2% cash back card that's chip and PIN priority for people who travel internationally.

DCU allows you to use your credit card with them as overdraft protection and charges no cash advance fees or higher cash advance APR and allows you to use up your entire limit with cash advances if you want. They also offer 6.17% APY on up to $1000 in their savings account and they have relationship benefits as you expand what you do with them that can include free checks and a .5% lower interest rate on credit products with them.

Those are just a few of them. I regularly check into various CU offerings and while they don't always have the best rewards cards, their other products tend to be very competitive.

[calyx]

I've been a member of CUs for years, but not for their credit card offerings.   For me, it's the customer service and local extras that I get.  When I financed my car, they worked with me and actually overrode the restrictions based on my FICO score alone to give me great promo rates for things like my auto loan.   Every time I've wanted to go into a branch or give them a call for help, they've been awesome.   I certainly can't say that happened when I was banking with the big nationals.