NEW YORK (6/11/13)--For consumers who are fed up with banks, credit unions can be a great alternative because they offer better interest rates on financial products and greater flexibility in providing loans by listening to members and looking beyond just their credit scores, said a consumer correspondent Monday on ABCNews.com.
"It's no secret that banks got a bad rap during the financial crisis for their part in risky mortgage lending and for fees that many consumers view as unnecessarily greedy," wrote consumer guru Elisabeth Leamy. "Perhaps that's why last year, credit union membership grew by two million people and credit union deposits topped $1 trillion for the first time ever, according to the Credit Union National Association."
Credit unions are in essence "nonprofit banks" and today everyone is able to join a credit union, which many people don't realize, Leamy said. Her story included a link to aSmarterChoice.org, the website that CUNA and the leagues launched to help consumers learn the basics about credit unions and find one they're eligible to join.
The high visibility of a story about credit union benefits on ABC News.com will help make more people aware of credit unions, a key goal of CUNA and the leagues' Unite for Good campaign. By Monday afternoon, more than 2,600 visitors had searched for a credit union on aSmarterChoice.org, about four times what the site typically experiences on a Monday.
Unite for Good is CUNA's campaign to rally credit unions toward the strategic vision in which "Americans choose credit unions as their best financial partner." The campaign's goals are: remove barriers, create awareness and foster service excellence.
In her column, Leamy addressed why people should join a credit union. "Since credit unions are non-profit, they can often afford to offer their members lower interest rates on loans," Leamy said. "They are also more flexible in listening to members' stories rather than just looking at their credit scores."
Leamy added that she researched interest rates for a $25,000 car loans and found banks were charging as much as 11.22% interest on a loan. She found that the lowest rate a credit union was charging for that amount was 4.25%. That lower rate would save consumers $2,000 interest over the course of the loan, compared with the higher bank rate, she added.
"Consumers have told us they want banking services delivered in a caring, low-fee environment," Shawn Gilfedder, president of McGraw-Hill FCU in East Windsor, N.J., told Leamy in the article. "Credit unions across the nation help their customers achieve financial wellness ... through a caring, needs-based approach."