Credit Union Mortgage: Alternative to Bank Mortgages

Obtaining a mortgage is one of the most important things that you will ever have to do because it is typically the largest investment you will make. A credit union can provide a mortgage for your purchase. Here are a few things to consider when shopping for a mortgage.

Dealing with Credit Unions

The first thing you will notice about a credit union is the difference in the way you are treated. Credit unions operate differently than banks because they are non-profit organizations. They are usually a very big part of the community and deal locally. The service that you receive will usually be vastly superior to that of a bank. Shopping for a credit union home loan will be a much easier process than what you are used to.

Lower Rates

The biggest thing in shopping for a good mortgage is the rate that you receive. In most cases, you will find credit union mortgage rates to be a lower than what you can find elsewhere

Since credit unions are non-profit organizations, they do not pay taxes and usually distribute any profits to the account holders in the bank. Therefore, they can pass this savings on to you in the form of lower rates. While it may not seem like a big difference, over the course of a 30-year mortgage, the difference will be substantial.

Fewer Fees

To go along with lower interest rates, you will also experience fewer fees. As part of the savings that they receive from taxes, they also require fewer fees upfront. There will still be some of the normal fees attached to the mortgage, but you will not find nearly as many as you do at some traditional lenders. This can save you a great deal of money upfront or factored into the mortgage payment.

Less Red Tape

Getting approved for credit union loans is usually a lot more hassle-free than with other lenders. While they still have an application process, it is usually a little more streamlined. You still have to fill out paperwork and wait for it to go through the necessary channels, but it is usually a little faster. They have fewer levels of hierarchy, which results in faster and easier approvals for you.