i have a credit union bank and never really knew what the difference was between the two and if there are any benefits
2007-01-07 12:06:29 · 8 answers · asked by shannon n 1 in Business & Finance ➔ Personal Finance
Credit unions are typically non-profit organizations which exist for the benefit of member only.
A bank exists to benefit a variety of stakeholders (customers, shareholders, owners) and it is a for-profit entity.
Each has its own advantages. Credit unions often offer lower interest rates when they loan you money, and higher interest rates when you deposit money with them. For example, I hold a car loan, certificates of deposit, high-yield savings account with my credit union.
Banks may be able to offer other benefits such as national and global availability, rewards programs with extensive benefits. For example, I utilize a rewards credit card from an international bank, as well as a free checking account, for ease of paying the credit card bill.
Both options can be of benefit to you, but it is up to you to investigate the choices available when you need to make a financial decision, such as applying for a loan, setting up a checking account, holding a credit or debit card, or saving for a purchase.
2007-01-07 13:48:08 · answer #1 · answered by Freddie 3 · 1⤊ 0⤋
The difference is mainly that a bank is much larger and has much more in the way of assets (and therefore, theoretically, less likely to be in danger of folding and taking your money with it). Also, most if not all credit unions do not get rated by Standard and Poors or Moody's or other grading facilities to show their strength. It costs a lot of money to do that and most Credit Unions don't have the asset base to do it. Also, credit unions, not having the rating, will pay more for the money they buy (yes, banks buy money to loan and invest with, etc... when you give them your money for, for instance, a time deposit/ certificate of deposit/ term deposit, whichever term it uses, they are in essence "buying" the money from you for a period of time, and they use it to loan out to earn interest) than rated banks, which is why they can offer you on the whole, higher interest rate returns on your deposits. This all isn't to say that the credit union isn't safe. It is, however, owned by members, not shareholders, and is generally much smaller. Hope this helps!
2016-05-23 06:06:29 · answer #2 · answered by Anonymous · 0⤊ 0⤋
Credit Unions are local banks with more of a local presence, i.e SECU, State Employees Credit Union, they offer more options, better service than regular banks
2007-01-07 12:45:54 · answer #3 · answered by Ram S 2 · 0⤊ 0⤋
Usually credit unions offer lower interest rates and accounts without fees.
However, more and more banks offer competitve rates and have no-fee accounts. I would search around. You may find a bank that offers rewards or better rates on loans.
2007-01-07 12:10:08 · answer #4 · answered by Anonymous · 0⤊ 0⤋
Stay with the credit union, they are better than any bank...
2007-01-07 12:14:24 · answer #5 · answered by Milkaholic 6 · 1⤊ 0⤋
A credit union is owned by the members. They are also chartered and regulated by different government agencies.
2007-01-07 12:09:11 · answer #6 · answered by Knowledge 3 · 0⤊ 0⤋
Credit unions are non-profit, and they are owned by the depositors. Most regular banks are for-profit companies owned by investors.
2007-01-07 12:09:41 · answer #7 · answered by weebl 2 · 1⤊ 0⤋
a credit union is a non profit bank and you have to pay a fee when you registar and acc.
A Charted bank gives you more options....overseas investing, curency acc's.
2007-01-07 12:20:01 · answer #8 · answered by Anonymous · 0⤊ 0⤋