When it comes to choosing a financial institution for your savings, loans, mortgages, or commercial products and services, deciding between credit unions and traditional banks like commercial banks, retail banks, and regional or community banks can seem challenging. 

This blog explores why credit unions are worth considering over their counterparts by diving into major considerations, including customer service, fees, interest rates, product offerings, and more.

Why Choose Credit Unions Over Traditional Banks?

Rates and Fees

Unlike banks, credit unions like SESLOC are not-for-profit financial institutions that return their profits to members in the form of lower fees and better interest rates. With SESLOC, you can optimize your finance with SESLOC checking account, which has lower NSF and overdraft fees, lower credit card late fees, lower mortgage closing costs, and even lower ATM fees than most traditional banks. This can save huge amounts in the long run.

Product Offerings

Banks might offer a vast diversity of financial products like savings accounts, certificates of deposit (CDs), money market accounts, and individual retirement accounts (IRAs), among others. Nevertheless, credit unions keep up with competition with equivalent offerings. They offer similar products, including checking and savings accounts, IRAs, and CDs, in addition to a variety of loan options, including personal loans, auto loans, home mortgage loans, used car loans, and home equity loans.

Loan Options and Interest Rates

Loans at credit unions usually have more favorable terms than loans at traditional banks. Fixed-rate mortgages, adjustable-rate mortgages, new car loans, unsecured fixed-rate loans, and other loan options typically come with lower interest rates at credit unions. Credit unions stand out with lower interest on loans and higher savings rates, making it an excellent option to consider.

What Makes Credit Unions Unique?

Superior Customer Service

According to the American Customer Satisfaction Index, credit unions consistently outshine banks in terms of customer service, website satisfaction, and even mobile app quality and reliability. With them, you can enjoy more personalized service as it prioritizes members over profit. Credit unions also offer services to those with an ITIN, making them more inclusive. If you search for credit unions that give credence to ITIN, credit unions pop up as a reputable choice.

Federal Insurance

Both Credit Unions and traditional banks ensure customers’ deposits. While banks are usually FDIC-insured, credit unions hold insurance from the National Credit Union Administration (NCUA). This means your money is safe and secure in both institutions up to certain amounts defined by law.

Access and Convenience

Credit unions were historically perceived as less convenient due to fewer branches and ATMs. However, most credit unions are members of the CO-OP Shared Branch network, which provides access to thousands of branches and ATMs nationwide. With digital banking options, mobile app technology, and even international banking services being offered, you’re covered wherever you go.

Membership Benefits

Unlike banks that serve all customers, credit unions like SESLOC serve their ‘members,’ who qualify based on a field of membership. Once you open an account with SESLOC Federal Credit Union, you become a member rather than just a customer, benefiting from lower fees, better interest rates, and superior customer service.

The Advantages of Banking With Credit Unions

1. Not-for-Profit Structure

Unlike traditional banks, credit unions are not-for-profit entities that serve their members instead of shareholders. This means their primary focus is providing value to members through lower fees, better loan rates, and quality customer service. Any profits made by the credit union are returned to members in the form of better loans and savings options.

2. Better Loan and Savings Rates

Due to their not-for-profit model, credit unions often offer higher savings rates and lower loan interest rates compared to conventional banks. Whether you’re seeking to secure car loans, fixed-rate mortgages, or even personal loans, the rates from credit unions, such as SESLOC Federal Credit Union, can be impressively competitive. They are popular for having smaller fees, which can help members save more money.

3. Personalized Customer Service

Credit unions, being smaller and community-centered compared to larger banking institutions, often deliver superior customer service. They can offer a personalized touch that bigger banks sometimes fail to provide. The importance of quality customer service cannot be overstated, whether it involves getting help with opening a checking account, discussing loan options, or receiving guidance on more complex financial services.

4. Membership Perks

When you open an account with a credit union, you’re not just a customer; you’re a member. This means you have a say in the credit union’s policies and decisions. Credit unions operate under a democratic structure, where each member has a voice. This, combined with the financial benefits of membership, makes banking with credit unions a rewarding experience.

5. Community Focus

Credit unions tend to focus on serving their local communities. They offer a variety of programs to help local small businesses flourish. The focus on community sets credit unions apart from retail, regional, and commercial banks, creating a uniquely nurturing and collaborative environment for financial prosperity.

Conclusion

Credit unions offer many compelling advantages over banks, including lower fees, better rates, superior service, and inclusivity. While banks have their own strengths and key role in the American Banking Association, credit unions—once regarded as small players—are now outpacing banks in numerous key areas. Thus, choosing a credit union for your financial services should be an option worth considering.