5 Reasons You Should Choose a Credit Union Car Loan

Written by Christina Miller
Edited by Carly Simon-Gersuk

So, you’re shopping for a new car. The financing program that your auto dealer is offering sounds great up front, but unfortunately you weren’t approved. However, you don’t lose hope because you know a) you still have a chance of being approved for a loan by a credit union and b) your rate will likely be better than the financing option the dealership was touting or than a loan from a bank. Here are five reasons provided by Mike Schenk, Deputy Chief Advocacy Officer for Policy Analysis & Chief Economist at the Credit Union National Association (CUNA), why choosing a credit union auto loan will serve you better than one from a commercial bank.

1.Lower rates

The most common term for a car loan is six years and credit union average rates are much lower than at a bank. According to market research from the end of 2019, the average rate on a new car loan of $30,000 over 36-months is 4.29 percent at a bank, while the same loan has an average rate of 3.20 percent at a credit union (1).

2.Higher chance of having your loan approved

A credit union is more likely than a bank to consider your plight if you have credit issues or limited credit. While the loan application and underwriting process does not differ much from that of a bank, you are more likely to get personalized attention and receive adjustments based on your personal situation that a bank would not make.

3.Better service

One of the main priorities of a credit union is to provide its members with personal, quality service. Members have a voice at a credit union, as the decisions aren’t being made by high-paid executives and a stockholding board of directors like they are at banks.

4.Educational resources

Credit unions seek to educate their members on all financial decisions. Most branches will help you calculate the real value of your car (vs. what the dealer says it is worth) and make smart decisions while providing objective viewpoints.

5.Non-sales approach

Since credit unions are not-for-profit, you won’t get a sales pitch from them like you will from lenders at commercial banks.

With the right credit union car loan, you could save a significant amount of money on your auto financing. Luckily for you, we have simplified shopping around for the best deal and it is doable within minutes. Get your engines roaring today and fill out your free auto loan application with us to see what rates you prequalify for!

 

Written by Christina Miller
Edited by Carly Simon-Gersuk

 

Sources

1.WalletHub, February 2020,
https://wallethub.com/edu/cl/auto-financing-report/10131/