Credit Union Frequently Asked Questions

1. What is a credit union?

A credit union is a member-owned, not-for-profit financial institution that provides many of the same services as banks, such as savings accounts, checking accounts, loans, and credit cards. Unlike banks, credit unions return earnings to members in the form of lower loan rates, higher savings yields, and fewer fees.

2. How do I become a member?

Membership is typically based on eligibility criteria such as where you live, work, attend school, or through family or organizational affiliations. Check the membership requirements of your credit union and complete a simple application, often with a small initial deposit.

3. What are the benefits of joining a credit union?

Members enjoy competitive loan rates, lower fees, higher interest on savings, personalized service, and a community-focused approach. Since credit unions are not-for-profit, their priority is member benefit—not shareholder profit.

4. Is my money safe at a credit union?

Yes. Deposits at federally insured credit unions are insured by the National Credit Union Administration (NCUA) up to $250,000 per individual depositor, just like FDIC insurance for banks.

5. What services does a credit union offer?

Most credit unions provide checking and savings accounts, auto loans, personal loans, mortgages, credit cards, online banking, mobile apps, and financial education resources. Many also offer investment services and insurance products.

6. How is a credit union different from a bank?

Banks are for-profit institutions that serve shareholders, while credit unions are not-for-profit cooperatives owned by their members. Credit unions focus on member service and community benefit rather than maximizing profits.

7. Can I access my money if I travel or move away?

Yes. Many credit unions participate in shared branching networks and surcharge-free ATM networks, allowing you to access your accounts at thousands of locations nationwide. Online and mobile banking also make it easy to manage your money anywhere.

8. Do credit unions offer online and mobile banking?

Yes. Most credit unions provide secure online and mobile banking platforms where you can check balances, transfer funds, deposit checks, pay bills, and manage your accounts 24/7.

9. What fees should I expect at a credit union?

Credit unions typically charge fewer and lower fees than banks. Common fees may include overdraft protection, late payments, or certain account services—but these are often lower than those charged by traditional banks.

10. How can I apply for a loan at a credit union?

You can usually apply online, in person at a branch, or through a mobile app. Requirements vary, but credit unions often have more flexible lending practices and focus on helping members find affordable options.

11. Why should I choose a credit union instead of a traditional bank?

Credit unions are community-focused, member-owned institutions. That means your money stays local, supports fellow members, and gives you access to lower loan rates, higher savings returns, and more personalized service than many traditional banks.

12. Do I have to maintain a minimum balance to keep my account open?

Most credit unions require only a small initial deposit—often as little as $5—to open and maintain your membership. Specific minimums may vary by account type.

13. What makes me a “member” instead of a customer?

When you join a credit union, you become a shareholder and partial owner. Your membership gives you voting rights and a voice in how the credit union operates, something you don’t get at a for-profit bank.

14. Can I get a mortgage or home equity loan through a credit union?

Yes. Many credit unions provide mortgages, refinancing options, and home equity loans or lines of credit. Because credit unions are member-focused, you’ll often find more competitive rates and flexible terms.

15. Are there perks for students or young members?

Many credit unions offer student checking, savings accounts, and first-time borrower programs. These accounts are designed to help young adults learn money management while enjoying lower fees and financial education resources.

16. How do credit unions support the community?

Credit unions reinvest in the areas they serve through financial education, scholarships, local sponsorships, and community development initiatives—strengthening the neighborhoods where members live and work.

17. Will joining a credit union affect my credit score?

Joining a credit union itself does not affect your credit score. However, applying for loans or credit cards may involve a credit check, just as it would with a bank.

18. Can small businesses use credit unions?

Yes. Many credit unions offer business accounts, commercial loans, and merchant services designed to support local entrepreneurs and small businesses.

19. How are decisions made at a credit union?

Credit unions are run democratically. Members elect a volunteer board of directors, ensuring decisions are made in the best interest of the membership rather than outside investors.

20. What happens if I move out of the area?

Once you’re a member, you can usually keep your membership for life—even if you relocate. With online banking, mobile apps, and shared branch networks, you can continue managing your accounts wherever you go.