Loans usually come with pretty high interest, but if you are a member of a credit union you can get a much better rate than you would be able to otherwise. This is because credit unions are a co-operative of people who band together to make it easier to take out reasonable loans and receive benefits.
Essentially, members of a credit union pool their money together in order to provide low interest rates. But to become a member of a credit union you have to satisfy their requirements. This could mean living or working in a particular area, working for the same employer or in the same field, and belonging to a church, trade union, or another association.
Every credit union has its own standards and requirements, and the only way to join is to satisfy their requirements. If you do your research, you will be able to find the credit union that is right for you and your financial situation. If a family member is already a part of a credit union, most will allow relatives to join as well. Here is everything you need to know about taking out loans from a credit union.
Finding the Right Credit Union
The right credit union is the one that has the benefits you’re looking for and will let you in as a member. You will be able to narrow down your options first by ruling out the credit unions you cannot join. Then, with those you are eligible for you can determine which union is the best for your situation. There are many places to find a credit union, there are government tools that can assist you in finding the union. Once you have found the right one, you will join the credit union and begin taking advantage of its benefits.
Taking out Loans
According to the experts at the site MoneyPug, which is commonly used to find short term loans, each credit union has their own loan policies, but typically they lend for five years, and up to ten years if the loan is secured with property. Even still, some credit unions lend for longer periods. While credit union loans are typically low interest, no union can charge more than 3 percent a month, or 42.6 percent APR. In Northern Ireland, in fact, no credit union can charge more than one percent per month. It depends on your financial situation and your credit union, but you will likely receive a much better rate than you would from a bank.
Repaying the Loan
If you don’t pay the money back in good time, you will likely be kicked out of the credit union and may even see legal percussions. With great perks come great responsibilities. You won’t be screwing over a bank if you don’t pay the credit union back, you’ll be betraying your fellow members. There are no penalties for paying back loans early, but you will be expected to pay it back on time. Whether you have a five year loan or a 25 year loan, you will need to make payments on time.
The benefits of credit unions don’t end with loans. Some credit unions even offer life insurance at no additional cost. If something should happen to you while you are in the middle of a loan, no one will have to pick up the tab either. Sometimes they offer discounts to associated businesses. Credit unions offer many advantages, and each one is different. Look into what credit unions offer and you will be excited to join.
Whatever you do for a living and however much money you have, anyone can benefit greatly from becoming a member of a credit union and taking advantage of what they offer. This includes, among other things, low interest rates on loans. But as with all loans, doing your homework is the most essential step to getting a great rate. With credit unions, if you make sure that you are joining the one that will work for you it will lead to countless benefits and advantages they have to offer. Forget banks, come to the other side. You won’t regret taking advantage of financial perks and low interest.