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May 21st, 2009

Have You Considered A Credit Union?

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From unexpected fees to poor customer service, we’ve heard it all from consumers who say they’re unhappy with their bank. If you’re one of these unhappy customers, have you considered switching to a credit union?

Credit unions (CUs) operate just like banks and typically offer the same services (checking/savings accounts, credit cards, etc.). CUs are member-owned and not-for-profit institutions:

If you have an account at a credit union, you’re a part owner in the enterprise.

This status helps explain why interest rates tend to be significantly better, and fees fewer and smaller, at credit unions than at banks. Any profits credit unions do make are distributed as dividends to their members. Contrast that with banks, which continually invent new fees and policies to boost profits (and to pay those stunning executive salaries).

JD Roth, author of the financial blog GetRichSlowly.org, says “Moving my money to a local credit union was one of the best financial decisions I ever made — and it saved me $96 a year!”

The experts say qualifying to become a member of a CU can be as easy as living in a certain part of town. Click here to locate a CU in your area.

Liz Pulliam Weston of MSN.com reminds her readers that CU aren’t perfect — but yet again, what bank is?

Occasionally I’ll hear of a credit union that’s instituted some silly fee, and too many have opted for “bounce protection” instead of real overdraft protection for their accounts. (For why the difference is important, read “Don’t be duped by ‘bounce protection.’“)

If you’re happy with your current banking situation, CUs may be worth your consideration.

(hat tip: JustThrive.com)

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About the HSH Blog

HSH.com's daily blog focuses on the latest developments in the mortgage and housing markets. Our mission is to relate how changes in mortgage rates and housing policy, as well as the latest financial news, impacts consumers, homebuyers and industry insiders alike. Our 30-plus years of experience in the mortgage industry gives us an edge as we break down the latest changes in an ever-changing market.

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Tim Manni

Tim Manni is the Managing Editor of HSH.com and the author of their daily blog, which concentrates on the latest developments in the mortgage and housing markets.

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