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FINANCE

6 Reasons to Take a Car Loan From a Credit Union

6 Reasons to Take a Car Loan From a Credit Union 41

So you’re finally ready to buy that Honda Sedan or the luxurious Toyota SUV you have been planning for!

However, managing the finances when buying your first car is never easy. You need to consider the down payment, interest, and deals you qualify for. This is why considering valleyfirstcu.org makes sense. Don’t believe us? These 6 reasons will convince you.

Lower Interest Rates

On average, the interest rate offered by credit unions is lower than what banks charge. This might not seem like much, but throughout a five-year loan, you could save hundreds, if not thousands, of dollars in interest.

Check out the annual percentage rate (APR) before signing on the dotted line. The APR includes the interest rate and any additional fees, so it’s a good way to compare loans. Also, check to see if there aren’t any hidden terms and conditions regarding the interest rates.

Fewer Fees

When you’re taking out a loan, the last thing you want is to be hit with hidden fees. With a credit union, you don’t have to worry about that. Most of them have straightforward fees and rates, with no hidden charges. This makes it easy to budget for your car loan.

Don’t be afraid to ask the credit union about their fees. This will help you understand what you’re getting into and ensure there are no surprises down the road.

Easier to Qualify

Credit unions are typically more willing to work with borrowers with less-than-perfect credit. If you’ve had some financial setbacks in the past, such as a bankruptcy or foreclosure, you may still be able to get a loan from a credit union.

If you’re unsure whether you qualify for a loan or not, it’s always best to ask. The worst they can say is no. Moreover, you will also learn what it takes to qualify if you’re currently not eligible.

Personalized Service

Since they are more like cooperatives, credit unions typically have a more intimate relationship with their members. This means you can expect to be treated like an individual, not just a number.

Also, taking out a loan can be a stressful experience, owing to the financial challenges you might face after taking out a loan. In that case, words of motivation from the lenders can help you stay put and think clearly.

Most credit unions are known to connect well with the borrowers, so a few words of motivation from the credit union executives won’t hurt! Also, take advantage of this personal relationship by asking as many questions as you can. It’s your money on the line, so you should know everything about the loan before signing up.

More Opportunities to Save

Credit unions also offer a variety of ways for members to save money. For example, they might have a program that allows you to save money on car repairs or offer discounts at certain retailers. This can be a helpful way to save money on the things you need, especially when money is tight.

Community-Oriented

When you join a credit union, you become a community member. This gives you a say in how the credit union is run and where its money goes. Also, most credit unions are nonprofit organizations, so you can feel good knowing that your money will support a good cause.

Final Word

From lower interest rates and fewer fees to personalized and community-oriented service, there are plenty of reasons to make the switch. So, before you take out a loan from a traditional bank, be sure to check out your local credit union. You might end up getting a better deal.

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