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Credit unions offer alternative to regular banks On the Money
BY CANDICE CHOI The Associated Press

    NEW YORK — As the U.S. banking industry undergoes a historic upheaval, many people are considering credit unions as a new place to park their money.
    While credit unions may not offer the breadth of services available at a bank, a greater degree of individual attention may be what some customers are looking for in the midst of a financial crisis.
    A key advantage is that credit unions often offer more competitive rates, too, since they’re tax-exempt, nonprofit cooperatives.
    Not just anyone can open an account at a credit union, however; each one caters to a specific community, whether it’s based on geography, profession or a particular company, university or church.
    The chances are good that you’re eligible to join at least one of the more than 8,000 credit unions in the country. But first, take a look at how credit unions stack up against banks on some key issues.
SAFETY
    The bailout plan signed by President Bush last week lifts the federal insurance level for both banks and credit unions to $250,000 per account. They were previously covered for up to $100,000 per account.
    The coverage for credit unions is provided by an insurance fund run by the National Credit Union Administration, a government agency that supervises the industry. Its counterpart, the Federal Deposit Insurance Corp., insures bank deposits.
    There’s a common misconception that credit unions aren’t insured. The reality is that fewer than 200, just a small fraction of the total number across the country, are not federally insured. The NCUA’s Web site, http://www.ncua.gov, lists credit unions that are government-backed.
RATES
    Credit unions generally offer more competitive rates on savings accounts, CDs and other financial products.
    This is because their nonprofi t status means that they aren’t motivated to substantially mark up their services. For the same reason, they may have lower ATM or overdraft fees. But that doesn’t mean you’ll always get a better deal at a credit union.
    “If you’re going to get the best deal, you’ve got to cast a wide net,” said Greg McBride, a senior financial analyst at Bankrate.com. That means considering both banks and credit unions, he said.
    To size up your options, check Bankrate.com, which lists the bank rates on numerous financial products. The site also surveys the 50 largest credit unions each month on rates for car loans, one-year CDs and 30-year fixed mortgages.
    The NCUA’s Web site also helps users find credit unions they can join.
    “In their particular community, people may find the rates are comparable, if not better [at banks],” said John Hall, a spokesman for the American Bankers Association, an industry trade group based in Washington.
SERVICES
    In general, banks offer a wider menu of services, such as portfolio management or commercial banking, and have more branches and ATM locations.
    Joining a credit union doesn’t necessarily mean sacrificing convenience, however. While credit unions tend to be smaller than banks, many are part of “shared branching networks,” meaning members can drop in at multiple locations around the country to make deposits or withdrawals.
    About half of credit union members have access to other credit union branches through a shared network, according to the Credit Union National Association, a trade group.
    The bigger the credit union, the more likely it is to offer services such as credit cards, mortgages, ATMs or online banking.
    Many credit unions are also part of ATM networks. Members typically don’t have to pay fees to use them, although it depends on the particular credit union.
    So even if your credit union doesn’t have a big physical presence, it may be in networks that make it easy to access, said Fred Becker, president of the National Association of Federal Credit Unions, another industry trade group.
    Customer service at credit unions may also be better since they’re member owned and operated, he said.
    “If they don’t provide the appropriate service, they’ll hear about it from the member,” Becker said.
    Members at smaller credit unions may all know each other well, too, resulting in a more congenial atmosphere, he said.
LOANS
    It may be easier getting loans from credit unions these days since they were less impacted by the risky mortgages. As nonprofits, credit unions generally did not push subprime loans.
    People shouldn’t run into any trouble getting loans at community banks either, however, said Hall, of the American Bankers Association.
    As with other financial products, rates on loans are typically better at credit unions than at credit unions. The difference is most apparent for car loans or credit cards and varies less for mortgages, said Jim Hanson, vice president of personal finance for CUNA.

credit unions do have a hiqher standard.....they are not hiqh pressure sales.....it's all about keepinq the members 'on track'.....one for all and all for one

I used to work at a bank and a credit union......huqe difference......