| By :
Nick Messe
It's summer, the time when many of us think about cruising around the lake or hitting the open road. If that sounds like you, and you're in the market for a boat or RV, you may want to head to your local credit union for the best rates. They typically offer loan rates that will blow the competition out of the water. They can do this because credit unions are owned by their members. When you join one, you become a member. This means you are more likely to be treated like a person and receive the type of service you desire. They are non-profit organizations. Unlike banks, credit unions are not in the business of trying to show a profit. In fact, any profit they make is distributed right back to its members in the form of dividends. Banks, on the other hand, are in business to make a profit and are, therefore, always looking for new ways to charge fees and change policies to make themselves more profitable. This explains why they can pay higher rates on deposits, and charge lower rates on mortgages, auto loans, and boat or RV loans. They also assess fewer and smaller fees for their services. Credit unions are exempt from most state and federal taxes. This is due to their non-profit status, and it represents one reason why they can keep fees lower and offer better rates to members. Banks do not like credit unions. Many in the banking industry believe they have an unfair competitive advantage and they go out of their way to point out the disadvantages of credit unions in an attempt to persuade customers to stick with banks. -Credit unions have membership requirements. While this is true, virtually anyone can qualify to join based on their place of residence, their employment or other associations they may belong to. Credit union ATM access is limited. In truth, most credit unions today offer either access to large networks of ATMs or reimburse members for ATM fees at out-of-network ATMs. They are not insured by the FDIC as banks are. Credit unions actually have their own insurer, the National Credit Union Administration. The NCUA functions for them much like the FCIC does for banks. Deposits are backed by the full faith and credit of the federal government, and each account is insured for up to $100,000. Some credit unions even have their own private insurance with covers accounts up to $250,000. How much can you save on a boat or RV loan? One recent survey shows on average that credit union rates are one to one-and-a-half percent lower than bank rates for boat/RV loans. Over the life of a loan, this could mean several thousands of dollars in savings. So, if you're looking for a loan to finance that new boat or RV purchase, remember to check with your credit union for the best rates around.
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