Every one of us has applied for a loan once in our lives, or at least thought about this option. It’s not a simple task, but in many cases, it is the only thing to do for handling the money problem that appears when you want to buy something more expensive, and you need a huge amount at once.
Then, people turn to banks, lenders, and other institutions to borrow the needed amount. In most cases, there are strict rules about who is eligible to get approved, which is why people need to explore all their options. See here more about eligibility.
If you are in the same situation, then you need to consider the auto credit union loan that might be the perfect solution for the issue. It is probably the best idea if you need money to buy a car.
In this article, we’re talking more about it, so if you want to know more about this issue, do read on and find out everything you want to know about why it’s better to ask for a credit union loan, rather than any other lender out there.
What is a Credit Union?
First, let’s find out what this is. A credit union is a non-profit organization, which is in most cases built by people working in the same company or who have mutual interests. The union is not owned by anyone and every member becomes part of the governance.
There are many benefits of credit unions, and borrowing money from its members is one of them. The good thing about them is that the credit offices won’t approve one to someone outside the union. Only members are eligible for it. Let’s see what other benefits there are.
1. You get much lower interest rates
When you apply for this kind of loan, you can be sure that the amount provided needs to be returned, but under the best possible interest rates out there. Unlike banks, these unions will provide perfect terms for their members. If you need a new car, be sure that this is the best way to do it.
The average interest rate for new vehicles through credit unions is around 5.2% and around 9% for used ones. If you go to the bank, you’ll be checked for your credit score, and if you have a bad one, your interest rate may go as high as 20%. See more about how to calculate the rates here: https://www.bankrate.com/loans/personal-loans/how-to-calculate-loan-interest/.
2. If you’re eligible for the union membership, you’re eligible for the loan
The best thing about being part of a credit union is that you’re eligible to receive the funds in almost all cases. According to stats, around 95% of all applications are approved. This is because not everyone can be part of the union, and if you’re eligible to be accepted, then the union members will take care of you and your needs.
That means you can kiss goodbye to the tons of application documents for getting a $5.000 car. Of course, this is just an example, but a credit union won’t ask any questions if you’re part of it. When the banks fail you, this is the place to go because you know that these people understand your struggle and are there to help you.
3. Credit unions are flexible for repayment
Everyone knows that sometimes it’s not easy to repay your debt. There are all kinds of situations in life, and it’s not always easy to find the funds to pay the monthly rate. Especially now, in times of a global pandemic, it is so easy to lose your job and have no money to pay for anything.
The credit union understands this and the officer will work with you to find the best solution possible for the situation. In a bank, no one cares about you, but here, you’re part of the family. This is why getting a credit union auto loan is much better than getting anything else.
4. The union will most probably pay for the auto insurance
In many cases, the union will pay for the insurance. You must have one both for going out on the open road and driving your vehicle, and one that will guarantee the loan. In case of an accident, the insurance company will pay for the damages and will save the debt.
If the vehicle is entirely ruined, then neither you will want to pay for the rates, neither the lender will have anything to protect their funds. That’s why the insurance is here to guarantee that everyone will be safe and no one will lose their money.
5. You can get a loan over the loan
There are so many cases in which you can’t be sure about whether you will need money again in your life while you’re already repaying an old debt. The credit union won’t give you problems if you need more money over the already existing debt.
They will easily prepare the documentation to get more funds for something else. Let’s say that you have your vehicle with the borrowed funds, but you need to do some home renovations. You’ll be borrowed again because you’re a valuable member of the community.
These are some of the most essential points and reasons why you should ask for a loan from a credit union, rather than any other institution out there. If you’re a member, be sure that the community will get you covered.