Credit unions have continued to gain in popularity in the past decade as people switch from big banks. Still, there are many misconceptions out there about credit unions which have made some people wary of joining one. Below you’ll find 10 of the most common credit union myths and answers debunking those claims.
Fact: While credit unions do require that members meet certain requirements to satisfy a common bond, many of these are broad and few of them truly limit membership.
Fact: With up to 65,000 ATMs available through various networks, availability is not an issue.
Fact: Credit unions offer the same services as banks, including automatic bill payments and direct deposit. Most services will transition easily and go uninterrupted.
Fact: While this may be true, it's because credit unions are not-for-profit organizations. Rather than spend money on advertising and marketing, credit unions rely on the community for marketing. The money saved is rolled back into services for members or distributed back to members as dividends.
Fact: Many credit unions do offer reward programs on credit and debit cards. For those that don't, take a look at the fees that are associated with the various accounts. At a credit union, you'll save on fees. Do your bank rewards outweigh the fees you're paying on each account?
Fact: Credit unions don't promote mobile options as aggressively as banks, but that doesn't mean they don't offer them. According to a study by CFI Group, bank customers rated their satisfaction at 86 out of 100 in online and mobile banking versus 90 out of 100 among credit union members.
Fact: Credit unions are not just like banks. Members own a piece of the organization and own a vote in determining how the credit union is managed. Credit unions also return all earnings back to members with their low fees and great dividend rates.
Fact: Actually, credit unions DO pay taxes. As a not-for-profit, member-owned financial cooperative, there are some taxes that credit unions don't pay. Those "unfair advantages," of course, are passed on to members.
Fact: Credit unions are held to the same laws and regulations as banks. In fact, credit unions face more restrictions on the investments and loans they make.
Fact: Credit unions offer consumer loans, debit and credit card services, online banking and bill pay, checking accounts, retirement investments, mortgages, car loans, and more. They are a great place to take care of all your banking needs.
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