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It's an old myth that
the less expensive option is usually more shady. The seller has to
cut some corners somewhere to beat the competitor's prices. But
sometimes, the seller simply has different priorities. That's the
case with credit unions.
The idea behind a credit
union is that a group of people pool their savings so they can loan money to
each other as needed. Interest is charged, but all profits are returned to
the group in the form of lower loan rates or higher savings rates.
Credit unions have a "field
of membership". Usually it's a place of work or a county where you live. So
when you apply for a loan from a credit union, you're borrowing from
neighbors or co-workers that you meet on a daily basis.
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Check out
BankerSpank.com
to
view hilarious parodies of the famous Mac/PC
ads and learn interesting
facts about
Credit Unions.
Unfortunately, you and your friends can't pool your
spare change and declare yourselves a credit union. You need to file a
charter with the National Credit Union Administration, and agree to yearly
audits and quarterly financial reports.
These days, banks are reporting record earnings to their
stockholders. As a result, many people are turning to not-for-profit credit
unions as a lower-cost alternative. Banks versus credit unions: It's not even
a close call!
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