When starting out and building your credit or in healing from a financial disaster such as bankruptcy, short sale and foreclosure, joining the right credit union is a marvelous first step in the building or recovery. Credit unions are different from other financial institutions in that they are member owned and operated. And like for profit banks, your deposits are Federally Insured up to $250,000.00.
According to an April 3011 article in the Denver Post, credit unions are quite financially healthy in Colorado. I believe you will find this true across the Country and, frankly around the globe. It is quick and simple to check the easily understood financial rating of any credit union, click this link and enter the name of the credit union. Click here for an explanation of the star rating.
A significant key to rebuilding your credit is to prove you are properly managing same. The best way to do this is to establish a significant deposit in your savings account with the credit union. A great benefit of a credit union is direct deposit and you can direct a certain amount to your savings on a regular basis which allows you to save significantly without ever missing the money you are saving.
Most credit unions will issue at least a $2,500 secured credit card, and one I have researched will issue a $50,000 secured credit card. The credit union will report your good payment history on the credit card which is of great help while you are healing your credit. Keep in mind the key 10% rule as discussed in my blog titled Fico Facts 101b.
Free checking with no strings attached is a standard benefit for credit union members. This is also true for ATMs as opposed to paying nearly $5.00 per transaction according to a recent report. If you are still with a for profit bank, check your monthly statement to see how much the fees are as of 2011.
Vehicle lending, signature loans, and credit cards are very strong features of credit unions. Many credit unions are simply third-party originators of mortgages and tend not to have the most highly seasoned or experienced mortgage loan officers.
How do you go about joining a credit union? As discussed in an earlier blog there are numerous ways to join a credit union. One may do so by employment, profession, geographic location, an affinity group, family, organization, association. I joined Coors Credit Union due to the fact I live in Jefferson County Colorado. And to illustrate how many credit unions are available to most of us, I am also eligible to join The Credit Union of Denver, Westerra Credit Union, Elevations Credit Union, Bellco Credit Union and Public Service Credit Union. If I researched further I would find even more credit unions for which I am or could easily be eligible.
Here is how I learned which credit unions were available to me. I clicked this link and reviewed the membership eligibility in my zip code. This is yet another link which just needs your home or work address zip code to look up the credit unions nearest you.
It is quite easy to find a cooperative credit union that acts very much as a a branch office of your ‘home’ credit union. You can conduct transactions, pay bills, make deposits, cash checks, etc., as though you were at your home credit union. You may need to speak with a supervisor if the front line teller is not familiar with the concept of Credit Union Shared Services. I’ve found that management is always happy to help the teller learn how to do these transactions.
As a final observation, many of my clients have had greater results by seeking a credit union that is simply too big to offer personalized service to help one build or rebuild credit.
I wish you the best success with your credit union experience. I certainly enjoy doing business with my CU!