Are you considering a significant purchase or loan in the near future and can’t decide what route you would like to take financially? If this is the case then a credit union can be a good bargain for your needs. The interest rates are normally better and most people agree the customer service is superior to a commercial bank. If you are thinking about joining a credit union, you will likely benefit from doing so; however, there are a few things that are different when using a credit union versus a commercial bank. The following are four of the most important things to keep in mind before making any rash decisions.
Fewer Branch Locations
This can be a big issue for some people. If you have a strong need to visit a physical branch of a bank and are looking to switch to a credit union, make sure you look at the locations of the branches in your area. Having more location may be a convenience but for many people this is not an issue. For example, more people than ever before are now getting direct deposits into their account, and this service is available at credit unions as well.
Fewer Automated Teller Machines
Credit unions, even the large ones, are smaller than the large regional commercial banks, and therefore, they will have fewer ATM locations. This problem has been addressed by more than half of the credit unions in the nation by forming a Co-Op that has constructed a network of ATM machines throughout the country. You should inquire as to where and how many ATM machines are available to the customers of the particular credit union you are interested in. Some prior planning will certainly help avoid any unwanted changes via foreign ATM usage.
Services offered with online banking can be more limited than with commercial banks. One example might be online bill paying. This is not as much of an issue as it was years ago, but some of the smaller credit unions may have a limited capability. Be aware of how much you depend on online services and make sure the credit union you are looking into has these features available to you before opening an account.
Lower Maximum Loan Limits
Certain loans may be too high for a credit union. Commercial banks may offer larger mortgages than a credit union, but this does not necessarily mean that it is a better institution. Getting a larger loan may not be what is best for your finances. Any limits that a particular credit union has with loans will be clearly specified in their policies. Make sure you understand what they are as this may deter you from one institution or another.
Credit unions vary in size, and the issues above are usually directly related to their size. If you are doing business with an institution like PenFinancial Credit Union, you may not experience any of the issues mentioned above. However, keep them in mind when you shop around for a credit union so you can find the right fit for you.