What's The Difference Between A Credit Union And A Bank?
Credit unions and banks are quite different. While traditional banks are for-profit organizations, credit unions are not. Rather, these organizations are owned by their members or account holders. When the organization is profitable, those profits are shared with members. While the structure of the financial organization is a big difference, there are many other differences between these organizations. As a financial consumer, it's important to know what you can expect from each organization.
Which Has the Best Rates?
When it comes to costs, expect big differences. You may find low-interest rate loans through traditional banks, but credit unions can often offer a lower rate. The longer you are a member, the lower your costs will be, especially if you maintain your account with the organization. Because they lack the corporate culture of banks, credit unions are less profit-driven. You'll find BMI Federal Credit Union® rates* remain highly competitive to all national and local banks.
Which Offers the Best Banking Tools and Products?
Today's credit union is a modern, thriving organization with plenty of tools available to members. Like most banks, online banking has become readily available at credit unions. You can manage your account not only through a website but with apps, too. Bill pay services are also available. More so, credit unions offer the same types of loans and financial products banks do, including checking and savings accounts, mortgage loans, lines of credit and numerous investment opportunities. BMI Federal Credit Union offers numerous products, including Money Management, an online money management tool to help you better manage your finances.
What's Different and What's the Same?
Here are a few more things to know about the differences in these types of financial institutions:
- Both bank and credit union deposits are insured with insurance coverage on deposits up to $250,000. Credit unions are insured by the federal National Credit Union Administration (NCUA), and banks are insured by the Federal Deposit Insurance Corporation.
- Credit unions tend to be more member-oriented. They are more likely to participate in community needs, are often sponsored by religious organizations or professional associations, and tend to provide ample financial training and supportive services.
One of the key ways that credit unions stand out is in their customer service goals. This goes beyond simply knowing your name. They tend to offer better educational programs and resources to help you improve your ability to be financially savvy and achieve your goals, whether you want to buy a home, invest in college, manage Medicare or even fund retirement.
When it comes to choosing between banks and credit unions, there's a big difference. The next time you want the lowest rate on a car loan or you need help investing for retirement, turn to BMI Federal Credit Union. Work with our Member Service Representatives today to get the highest quality of service and exceptional support along the way. And, you'll be working with a modern, competitive financial institution.
* Disclaimer: Federally Insured by NCUA. Rates, terms and conditions are subject to change and may vary based on creditworthiness and qualifications. All loans subject to approval. Equal Housing Lender.