Benefits of Taking Out a Loan with a CU vs. a Bank

Lower rates: Auto loan averages for CUs as of July were 2.85%  on a 36 mo. car loan vs. Banks @ 5.59%.  Therefore, banks are charging nearly twice as much for the same loan.

Easier to borrow: Community-based CUs tend to be easier to deal with than megabanks. Lending decisions are more likely to be made locally with more flexibility.

In addition, while few national banks make signature loans(unsecured loans), CUs regularly offer this type of loan to their members with good credit.  CUs also offer lower-dollar loans than banks.  You could get a $500 signature loan with a CU, but probably not at a bank because it wouldn't be profitable to them.

Loans through CUs are usually reviewed and completed in a much quicker time-frame.

Lower fees:  When it comes to fees, you will probably find better deals at CU’s than at giant commercial banks.  Whether is for fees to maintain loans, checking accounts, ATM fees, or penalty fees for overdrawing, you are more likely to have fewer and lower fees at your CU.

Credit Unions are typically smaller than banks so talking with, meeting with or working with a real live person happens much sooner in the loan process.  If you've been a member for a while, you might have even talked to the person who makes the decisions on the CU's loans.

Credit Unions offer loans that a lot of traditional banks do not.  Overall, CU rock compared to traditional banking institutions!

Post by: Lori S.

If this conversation sounds familiar to you, we want you to share the love!

"The bank charged me $35.00 for insufficient funds in my checking account. They also sent the check back to the company I wrote it out to and they will probably charge me another $35.00. Ugh! I know it was my mistake.  I used my debit card but forgot to write down how much I spent.  But that money was supposed to be used for groceries and my public service bill, and now I'm going to be short this month!" 

Later that day, after talking to a member of Horizon Community Credit Union...

"What?! If I had an account at Horizon Community Credit Union I would have overdraft protection!? They pull the money from your savings (share) account to cover the overdraft check and only charge you a $5.00 fee! That's unbelievable! Only five bucks for my accounting error? Not a bad deal! That would have saved me money for my groceries and quite a bit of embarrassment! I’m definitely heading to Horizon CCU to open a savings (share) and checking account!"

Don't keep HCCU a secret!  One of the many benefits to being a credit union member is that credit unions are not for profit.  Rather than pad our own pockets, we return our earnings to our members in the form of higher deposit rates, lower loan rates, and lower and fewer fees.  Not only that, but the mission of Horizon Community Credit Union is to help our members success financially.  Credit unions don't exist to make only a few people rich; they exist to help their members and communities be more financially secure and money-smart.  Know someone who would be better off with our benefits and services?  We'd love to meet them!

Post by: Alice E  

Just Say NO to Payday Lenders!

I’m sure you've seen or heard the commercials for payday or title loans that give you cash in 30 minutes or less, but hopefully you haven’t (and won’t) sign up for one of those loans. Want to know why? Keep reading.

Have you read the fine print??????? Do you know that many of those places charge over 300%APR for a loan? OMG…300%....no, that’s not a typo, there shouldn’t be a decimal in there, three hundred, not kidding (unfortunately). Let that sink in for a minute.

So what does 300% APR mean exactly? Well, if you go there and get a loan for about $1000, and pay it back over 6 months, you will pay back roughly double what you borrowed. That’s right, they give you $1,000 and you pay them back about $2,000. If you can pay it back on time exactly as agreed upon. As if that isn’t bad enough, if you can’t pay it back on time (which is what often happens), they can automatically withdraw what you owe from your account. What typically happens when they try to do that? You overdraw your account and are charged a fee. Then they try to withdraw the money again, and you probably still don’t have it or you would have sent it to them, so you overdraw your account again and are charged another fee. Wait, this happens one more time, because they can try to take the money 3 times for each payment, so there’s another fee. Now you still owe your payment, plus you wasted all that money on 3 NSF fees, and the payday loan place probably has some sort of late fee or NSF fee too. Do you see how this can start to snowball quickly and put you deeper and deeper into debt with no good way out? It happens too often, and we don’t want it to happen to you!

To give you something to compare to, that same loan here would come with a rate of between 3% and 16% (rates are determined by a number of factors including your credit score and history, amount of unsecured debt, and past bankruptcy). Even using our highest rate of 16%, if you borrowed $1,000, you would pay us back roughly $1,050. That’s quite different from the example above where you borrow $1,000 and pay back $2,000. What would you do with the $950 you saved? You can probably think of lots of things, that’s a lot of money!

So JUST SAY NO to Payday Lenders (or anyone else charging a ridiculously high interest rate for that matter). Call us, tell us your situation and let us try to help. Whether it’s a loan here, at a dealership, a bank, or another credit union, know what you are agreeing to before you sign anything.

Here are some questions you should ask every time you apply for financing anywhere:
· Is there an application fee?
· What is my interest rate?
· What is the repayment period?
· What is my monthly payment and can that amount change? If it can change find out what would cause it to change, how often it can change, and how much it can go up.
· Is there a penalty for prepayment?
· How much will I pay in interest over the life of the loan?
· What happens if I default?

Post by: Cari J