MADISON, Wis. (12/21/11)--Consumers know now--thanks to Bank Transfer Day--that credit unions are good deals on checking and savings accounts. Two recent media reports also touted the benefits of getting a mortgage at a credit union.
"Credit unions have become a banking alternative of choice for disgruntled debit card and checking account holders nickeled and dimed by fees, but credit unions also hold their own in the mortgage market," wrote Broderick Perkins in The Californian.com (Dec. 12).
While banks offer better fixed-rate mortgages for conforming and jumbo loans, "credit unions consistently offer better rates for adjustable- rate mortgages (ARMs) and home equity loans," the article said, citing the National Credit Union Administration and interest rate analyst Informa Research Services.
For consumers looking to use their wallets to make a political statement, "financing a home loan with a credit union can be more effective than bellowing through a bullhorn while occupying a city square," the article said.
It referred to statistics from the Credit Union National Association on credit unions' growth as a result of consumer backlash to bank fees. The article also noted that the lack of the profit motive kept credit unions out of harm's way during the mortgage meltdown, andit cited other advantages of credit unions including structure, federal insurance, and membership.
In MortgageLoan.com, featured on the NASDAQ website (Dec. 9), the article, "Consider a Credit Union Home Loan," pointed out: "If you're shopping around for a mortgage, don't overlook credit unions--even if you don't belong to one."
The article noted that "credit union mortgage rates can be very competitive, on par with and even lower than major banks. And because credit unions typically don't pile on lots of 'junk fees' to their closing costs, the actual cost of borrowing is often lower than it would appear from just their posted mortgage rate."
Credit unions have doubled their market share of mortgage applications since 2007, said the article, which added that UW CU, based in Madison, Wis., was the first credit union to be listed as a major source of home loans in a major U.S. metropolitan area. It was the No. 1 provider of mortgage loans in the area in 2010, according to statistics from the Federal Financial Institutions Examination Council, the article reported.