Purchasing a car can be exciting, and whether you’re looking for a new or used car, having a preapproved loan makes the process easier. When applying for a car loan, you have two options: going directly to lenders like a credit union or bank, or having the dealer handle financing. Each has benefits, but there are some distinctions. In this article, we will look at how credit union and bank vehicle loans compare in three crucial ways.
Rates
Credit Unions: Members own credit unions, and all earnings are returned to members through lower interest rates and fees. Credit union rates on new car loans are often more than 2% lower than bank rates. 1
Banks: Banks often offer special rates on auto loans and will sometimes lock in a rate on a preapproved loan offer for a limited time (usually 30 days) while you shop for a car.
Customer Service
Credit Unions: Customer service is typically more individualized as credit unions generally serve a specific community. To apply for a loan, you must be a credit union member. It’s easy to join, and being a member has many benefits, such as financial education.
Banks: National banks have more physical sites compared to smaller community banks or credit unions. Larger banks, on the other hand, have less individualized relationships with their customers..
Credit Unions: Many credit unions offer checking accounts that do not require a minimum balance and do not charge monthly service fees. Fees for items such as a bounced check or overdrafting an account, may be lower at a credit union than at a bank, depending on the credit union.
Credit unions strive to serve their members to meet their needs. Typically, credit unions serve their local communities, so local branches tend to know their members on a more personal level. This makes it easier to build relationships with branch managers and loan officers. This can make it easier to obtain the loan you require.
If you are looking for an auto loan from a credit union, look no further than Heritage Financial Credit Union. You can find the right interest rates and get many benefits when you take out a loan from Heritage Financial Credit Union.
1 https://heritagefcu.com/find-the-best-credit-unions-near-me/