In fact, the first stop to ask for a personal loan should be at the credit union, especially if you don’t have a great credit score. Credit unions offer more flexible terms and lower interest rates, and employ loan officers who will look beyond the credit score. Why should you consider a credit union personal loan?
- You’re already a credit union member, or you qualify to be a member.
- Your credit is bad or average.
- You have no problems visiting the branch to finalize the application process.
How Does A Credit Union Personal Loan Work?
It’s important to understand that a credit union is considered a non-profit financial institution, serving its members who live, work or study in a certain area. If you meet its requirements, you pay a one-time fee for membership and need to deposit at least $25. The only way to apply for a personal loan is to be a member of the credit union.
Credit unions do have both secured and unsecured personal loans, which are fixed rate loans. How much your rate is will depend on four things:
- Credit score
- Credit history
You won’t be automatically denied for a personal loan if your credit is bad, as these institutions look at more than your credit history such as your financial standing and standing as a credit union member. Of course, if you have a high credit score, you’ll get a better interest rate than someone who has a less than ideal credit score.
Credit unions are available in various sizes, which means the aspects behind a personal loan can vary such as approval criteria, application process and rates. You may be able to start an online application and finish the rest in person or submit an online-only application.