How To Get A Loan From A Credit Union

Monday, July 12th, 2021
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There are many places that you can get a loan such as banks, finance companies, and online lenders. When searching for a lender, you should add credit unions to your list. Local institutions offer benefits that big-name banks and lenders do not. Here’s how you can get a loan from a credit union.

Know how they work first

Although they offer most of the same services, credit unions are different than banks. The ownership is perhaps the biggest difference. Credit unions are owned by members and are not-for-profit organizations. This means that the members see the benefits of any growth within the institution, not the executives. Credit unions often have lower interest rates and more personalized services.

Become a member of a credit union

In order to see any benefits of credit union membership, you must qualify to become a member. Depending on the institution, requirements may be strict or easy to meet. For example, you can join some based on your occupation or others based on where you live. It is usually simple to find a local credit union to join. Once you have found one to join, all you have to do is open an account with a small deposit.

Finding the right credit union for you

If you aren’t sure where to start, it can help to consider your needs. If you only need a loan, you might want to stick with your current financial institution. But, if you’re looking for lower rates all around, and a long-term solution to your banking, a credit union would be a great choice for you. Here are some tips to help you find the right one for you.

  1. Start local: You could look up a national credit union online, but a local institution will be better able to serve your financial needs.
  2. Ask about services: Even if you are only interested in a loan right now, it never hurts to ask about additional services. You might find that a credit union can help make your financial life better.
  3. Look at reviews online: These days, the digital era runs everything from getting food to finding products and services. Banking is no different. You can see reviews and ratings online to see how other people experience each institution.

Prepare to apply

Once you have joined a credit union, you can then apply for a loan. Some may even let you do this at the same time. However, there are some things you will need to prepare before getting a loan from any lender, including the following.

  • A completed application (online or on paper)
  • Identification documents (Like your social security card/number)
  • Employment and income information
  • Credit history
  • Down payment

If you aren’t sure where to start, that’s okay! Credit unions are known for their personal service. You can always set up an appointment with a team member or call them to figure out what you will need to do. They can help you choose a type of loan if you are trying to build credit, for example.

What to do after you have applied for the loan

Credit unions can often provide a confirmation that you have qualified for a loan faster than banks. That being said, if they are busy, they won’t be able to lend to you that quickly. One thing credit unions can do is offer e-signature services and pre-approval. This means if you are looking to get a new or used vehicle, you can take care of things and drive away faster.

Once you have signed all the paperwork and have your loan (no matter the type), there are some things you should do.

  • First, make your payments on time. If you think you will have trouble, let the credit union know.
  • Next, make more than the minimum payment when you can (and if they let you). This will let you pay off the loan faster and let the credit union know you value their services.
  • Finally, stick around after you pay off the loan. Having a relationship with your local credit union will mean more benefits for you.

Interested in a loan from Borger Federal Credit Union?

At BFCU, we provide a variety of Loans including auto, RV, and home equity loans. If you would like to learn more about working with us, call (806) 273-9506 today. Becoming a Member is easy: if you live, work, attend school, or worship in Hutchinson, Carson, or Gray Counties, you are eligible to join!