Why Credit Unions?
When someone mentions getting a loan, you probably automatically assume you’ll need to talk to a bank. Most people never even consider a credit union, often because they don’t know anything about them. But the truth is, they’re able to offer some game-changing benefits that a big bank can’t.
Credit Unions vs. Banks
Just like banks, credit unions accept deposits, originate loans, and provide a number of financial products and services. You can use them in all the same ways you would any traditional bank. And federally-insured credit unions are just as safe as your bank. Like the FDIC insures banks, credit unions are insured by the NCUA, backed by the U.S. Treasury.
The main difference between the two is that a credit union is a nonprofit organization, owned by its members. Banks, as you know, are owned by investors and operate with the primary goal of making these shareholders more profits. Credit unions have no need to make money for their members at your expense, and since they are owned and controlled by people within the community who use the same services, they care about their customers. And this mentality translates into benefits for you.
The Benefits of a Credit Union
- They Offer Better Interest Rates - Credit unions have the same financial products as banks - plus a variety of specialty loans that banks don’t offer - but they’re a lot cheaper. Big banks are focused on making money, and this goal often contradicts the objectives of its customers; ie. low rates, low fees, and great customer service. Since credit unions aren’t focused on profit, they’re able to better balance these numbers to offer higher savings rates and lower interest rates on loans to their customers.
- They Have Lower Fees - Fees, including loan origination fees, are one of the primary ways banks make their money. As a non-profit, credit unions focus on covering operating costs, so instead use their profits to give back to their customers in the form of savings. As a result, they have lower fees on all their services and fewer of them compared to national banks.
- They’re Customer-Focused - Credit unions’ unique membership structure works to serve its community with the best care and support possible. Credit unions are owned and controlled by the people and exist to promote the well-being of their members who use their services every day. So your loan isn't going to some faceless underwriter - it’s being reviewed by someone who lives and works in your community, just like you.
- More Flexibility - For this same reason, credit unions are also more willing to work with you during specific financial challenges that arise. And whether you’ve had a less-than-perfect credit history or issues with employment, they’re much less likely to deny you a loan than most major banks.
Why RenoFi Partners with Credit Unions
You make such a huge financial and emotional investment in your home, so you should love where you live. For all the reasons listed above, RenoFi works with credit unions, so that we can build our community together - offering our homeowners the best experience and most competitive rates out there to help them achieve their renovation goals and live a better life in a home they love.