There are a lot of myths about credit unions. Maybe you've heard that you have to work for a certain company to join one, that credit unions don't offer the same services as banks, or that you need perfect credit to become a member.
But how much of what you've heard is actually true?
Let's take a look at some common credit union myths and separate fact from fiction.
True or False: You have to work for a specific company to join a credit union.
False.
This may have been true for some credit unions in the past, but membership eligibility has expanded for many credit unions.
Depending on the credit union, you may qualify for membership based on where you live, work, go to school, worship, or other connections to a particular community or organization.
If you've never looked into joining a credit union because you assumed you wouldn't qualify, it may be worth checking. You might be eligible and not even realize it.
True or False: Credit unions are owned by their members.
True.
Unlike traditional banks, credit unions are member-owned, not-for-profit financial cooperatives.
When you join a credit union, you become a member-owner. The credit union is there to serve its members, rather than outside shareholders.
That's one of the things that makes credit unions different. We focus on helping our members and the communities we serve reach their financial goals, rather than making a profit.
True or False: Credit unions only offer credit cards.
False.
Credit unions offer many of the same products and services you would expect from a bank.
That can include checking and savings accounts, auto loans, home loans, personal loans, credit cards, online banking, mobile banking, and more.
So whether you're looking for an auto loan in Logan, buying a home in Brigham City, or simply looking for a new checking account, a credit union may have options to help.
True or False: You need perfect credit to join a credit union.
False.
You don't need a perfect credit score to become a credit union member.
If you're applying for a loan, your credit history will be one of the factors a lender considers. But having less-than-perfect credit doesn't mean you can't become a member or explore your financial options.
If you're working on improving your credit, paying down debt, or preparing to apply for a loan, talking with a financial professional can help you understand where you stand and what steps you can take next. (And if you're an Elevate member, good news - our members get free budget counseling!)
True or False: Credit unions can offer competitive loan rates.
True.
Because credit unions are member-owned and operate differently from traditional banks, they may be able to offer competitive rates and fees on certain products and services.
Of course, rates and terms vary from one financial institution to another, so it's always important to compare your options. If you're shopping for a new car in Northern Utah, comparing auto loan rates before you head to the dealership can help you make a more informed decision.
The same goes for mortgages, personal loans, and other types of financing.
True or False: Credit unions don't offer online and mobile banking.
False.
Credit unions may focus on personal service and local communities, but that doesn't mean you have to sacrifice convenience.
Many credit unions offer online and mobile banking that allows you to check your balance, transfer money, deposit checks, pay bills, and manage your accounts from wherever you are.
So whether you're at home in Cache Valley, commuting through Ogden, or traveling outside of Utah, you can still access your accounts when you need them.
True or False: Credit unions are only for people who want to bank locally.
False.
Many people choose a credit union because they appreciate local service and a community-focused approach. But that doesn't mean you're limited to doing all of your banking in person.
Online and mobile banking, ATMs, shared branching, and other services can make it easy to manage your money wherever you are.
You can enjoy the personal service of a local credit union while still having access to the convenience you expect from a modern financial institution.
True or False: Credit unions support the communities they serve.
True.
Community involvement is a big part of what credit unions are all about.
Credit unions often support local schools, scholarships, nonprofits, community events, and other organizations that make a difference in the communities they serve.
Here in Northern Utah, supporting our communities is especially important to us. From local schools and students to community events and nonprofit organizations, we believe in giving back to the places our members call home.
True or False: Banks and credit unions are exactly the same.
False.
Banks and credit unions offer many of the same types of financial products, but they operate differently.
Banks are generally owned by investors or shareholders, while credit unions are owned by their members. That difference can affect how each institution operates and how it approaches its relationship with the people it serves.
At the end of the day, choosing a bank or credit union is a personal decision. The most important thing is finding a financial institution that offers the products, services, rates, convenience, and service that work for you.
The Truth About Credit Unions
There are plenty of myths about credit unions, but the truth is that credit unions can offer much more than many people realize.
From checking and savings accounts to auto loans, home loans, online banking, and more, credit unions offer a wide range of financial products and services. And for many people in Northern Utah, joining a credit union may be easier than they think.
Whether you're opening your first checking account, saving for the future, buying a car, or purchasing a home, having the right financial partner can make a difference.
At Elevate Credit Union, we're proud to serve members throughout Northern Utah. We're here to help our members take the next step toward their financial goals.
Learn more about the accounts we offer, or check out the rest of our MoneySmart Tips blog for more money tips and topics!