Considering Switching from a Large Bank to a Credit Union - Advice Please?

Updated on February 13, 2013
X.C. asks from Natick, MA
17 answers

We're currently at a large bank and I keep reading how great credit unions are. The only "con" I can find with credit unions is the limited amount of ATM's, but most I've looked at waive fees at other peoples ATMS. So if credit unions are so great, why isnt everyone using them? I guess I just want to hear some personal experiences - do you use a credit union and love them? Do you know any reasons NOT to switch to a credit union? Are they less "secure" than banks?

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answers from St. Louis on

I don't think a lot of people know credit unions formed co ops. I have access to more ATMs through my credit union than I did with Bank of America, and without the attitude!

I bank with American Eagle CU which is part of the Anheuser Busch CU so in itself it is nationwide. Add to that the network and I am set.
Oh I switched after B of A messed up an ATM deposit. Their justification, do you know how many customers we have? One less I suppose!

3 moms found this helpful


answers from Dallas on

We have accounts at both, one account at Wells Fargo, and one account at a credit union. We like the convenience of Wells Fargo, but the personal service and interest rates at the credit union. I've had an account at the credit union for 25 years, and some of the same people have worked there the entire time. I love that!

1 mom found this helpful

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answers from Norfolk on

You have to know what the differences are between banks and credit unions.
Credit unions tend to treat their customers different than banks because with a credit union - you are part owner.
A bank makes decisions based on their profit structure and bottom line.
If the bank determines that customers with small balances are not generating a profit (you are careful never to incur a fee or penalty) - they can and will dump you as a customer - and this tends to make people mad.
You do what you can to be responsible with your finances but if you are 'good' but have less than $5000 (or what ever arbitrary minimum number the bank comes up with), they are not interested in keeping you as a customer and will encourage you to leave or simply notify you that your accounts are being closed with a notice that basically states something along the lines of 'Go away little person. You irk me.'.
I've never head of a credit union ever doing that.

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answers from Minneapolis on

Many credit unions are part of "networks" that are surcharge free. Also, you can always get cashback without surcharges at many stores. If you purchase a tube of toothpaste or a pack of gum, you can get cash.

Credit unions are still insured by the federal government. Banks are secured through FDIC and credit unions through NCUA. The big banks received tarp money to bail them out and credit unions did not.

Credit unions require a certain amount of money to be kept in a savings account (many times $5) bc it is a co-op. This gives you an equal share regardless of how much other money is in your account. It also gives you voting rights.

I do work for a credit union, but I believe in the movement. For me, it is about people helping people and working for a not-for-profit organization that gives back to our communities (we give $20K/year in grants in addition to $10K in scholarships, donations, etc.). I LOVE the people I work with and I LOVE our members. they're great people, not numbers and I love that I can make a difference in their lives. I don't know a lot of bank employees that can say that.

2 moms found this helpful


answers from Dover on

My credit union is great. Their fees are lower (my checking is free without minimum balances or check limits), rates are higher, staff seem friendlier, and they are customer friendly. I find that I get personalized service even though I am not one of their large accounts. They are just as secure as other banks.

I think some don't use them because they aren't "national" accounts but they do have a network of credit unions so, for instance, my son away at college can go to one of the local credit unions that are within our cu's network if necessary.

2 moms found this helpful


answers from Boston on

Yes and yes! I love mine. We used DCU (Digital Credit Union) and it is so worth looking into. That is the only draw back but I have found a few around Boston and one near my home. DCU also has an app for your iphone or android and you can sign up for their deposit program where you can deposit checks via your phone. It is really cool. I would check them out.

And no, I wouldn't say they were less secure than banks. They tend to have better rates and products to offer.

2 moms found this helpful


answers from Denver on

I love my credit union. Less fees, great customer service, all the bells and whistles like online banking etc.

A lot of the credit unions are a part of a co-op and therefore their ATMs are free and you can bank at any of the credit unions in the co-op. My credit union is based in another city, but I have plenty of other branches that I use here.

1 mom found this helpful


answers from Jacksonville on

We love our credit union. It is a bit of a pain that there are no branches where we live, simply because it makes the rare deposit (in person) a little annoying. There is a branch at the facility my husband works at (federal employee and the site is inside the gated facility, so "I" can't use it though), but he hates having to deal with any banking stuff on his breaks at work.
So, we keep a small local account on a local bank for that sort of thing... stuff that can't be direct deposited--- rebates that come in the mail, checks from a friend for concert tickets being reimbursed or whatever. Little stuff. It's a free checking account, and I don't keep ATM cards on that.

The credit union doesn't even have ATMs in our state. It is actually in Florida and we live across the state line in GA. But every single grocery store ATM is basically free--up to 10 withdrawals per month I think it is. But I almost never make withdrawals anyway--I just get cash back when I pay for groceries with my debit card.

It isn't an issue.
We earn interest on both savings and checking and there are no fees, at all. Every car purchase we have made, we have used the credit union to finance it. I have yet to find a dealership that can match the rates through their finance companies. EVER.
Our kids also have "kids" accounts there. No minimum balance. No fees. We love it. I would never go elsewhere unless I had no choice.

1 mom found this helpful


answers from Pittsburgh on

Love our credit union! They give OUTSTANDING service.

(And they don't funnel profits to accounts in the Cayman Islands!)

1 mom found this helpful


answers from Detroit on

My closest CU branch is 45+ minutes away. There are at least 4 ATMs nearby that are part of the CO-OP network and therefore surcharge free. All of those ATMs will take deposits so I only have to visit my actual branch once a year or so. My CU also has good computer access so I can open accounts and CDs, pay bills, etc. and they offer check deposits via smartphone - where you take a photo of the check and submit it. So depending on the CU, you should be able to find one that fits your needs. I find them more willing to work with you and go the extra step when needed compared to a larger bank. Do your homework though. Some are much better than others!

1 mom found this helpful


answers from Springfield on

You are right when comparing CUs to large national bank chains. However, regardless of if you are in a bank or a CU, take a look at them individually. Not all are created equal. Small, community banks have a lot to offer in terms of customer service and don't fee you to death like the national banks. A mutual bank is one in which depositors are shareholders as well and have voting capacity. I love my small communtiy bank - the people are friendly and helpful, always looking out for the best interest of the customer, not the bottom line. One big thing to look at is if they have insurance coverage over the FDIC limit. Most small banks in MA pay insurance premiums to cover their customers' deposits in full either through the DIF or SIF. Good luck!!



answers from Washington DC on

My DH already belongs to a credit union. After getting craptastic service from the bank that gobbled up my local bank, I started looking at moving my money. I am probably going to the credit union for my regular banking needs and a small local bank for my business account. The credit union offers me options where I can get money for my money (interest) but if I don't keep a set balance, I don't gain, but I don't lose. Many bigger banks have nasty monthly fees you should look out for. As a freelancer, I get my payments in different ways and rarely direct deposit. Many banks would charge me $5-$12 per month to deposit by check. If you are a smartphone user, see if your credit union options allow for scanned check deposits. Ours doesn't have that app yet, but DH walks by the branch twice a day every workday so it doesn't matter so much. He'll be joint on this account as I am on his and can deposit for me. This CU has more shared ATMs in our area than I thought they did AND they now have ATMS in many 7-11s. You should look at a location map to see how few/many there really are. We have long had DH's CU accounts and the only problem we had was the kids not using theirs so we closed them to avoid fees. I think people don't use them b/c the big bank is more convenient or they think they don't qualify. Our CU is through DH's work.

We did use them for a car loan and extended warranty for DH's car and got a much better rate. The biggest reason I didn't change before now was I was happy with my local bank (was a customer since 1999) but since the merge, it's been one thing after another. I would rather plan ahead with my few deposits than be taking time to go to the branch and yell at them for the same foolishness they did just a few months ago.


answers from Los Angeles on

I belong to an educational (teachers) credit union and have since I was a child (my dad was a teacher). My mom also worked for 25 years for the same credit union. About a year ago, we closed our Citibank checking/savings and went 100% with our credit union and have never looked back. The customer service is absolutely phenomenal. Our savings/CD rates are also better than the big banks. They network with other local credit unions in our area so that we have plenty of ATMs in our area that we can use w/out fees.

Honestly, I wish we'd made the switch sooner. I can barely stomach the big banks after the financial meltdown. Now I feel good about where my money is stored.


answers from Hartford on

I love my credit union and I have been with them for over 20 years (personal account before being married). I also use 2 of the big banks (one joint account and one business account) and while I am happpy with one, the other is a nightmare. It used to be that you had to qualify for membership to specific CUs and I think that is why they were less frequently used. Also, many did not offer the same range of services as the big banks. For example, my business account ended up at a big bank because my CU did not offer it at the time I started my business. Also, because they hold mortgage debt, they are very strict with borrowing. That is why I ended up at a big bank for the joint account. During the past few years, however, this has changed and I am seriously thinking about moving everything over to my CU. Just like any big bank they are FDIC insured and probably more solvent than most because decisions are locally made. As another mom noted, not all CUs are the same, but this is my personal experience.


answers from Chicago on

I do love credit unions, but have also found the same level of service offered at a bank that operates only in my area (Chicagoland--it has about 20 branches). My branch is great--the manager has been there for several years--he knows me, he knows my FIL who moved out of state several years ago, but maintains a small account there. They offer many free services, all the perks of online banking including mobile deposit, etc.

Credit unions tend to be very conservative, so you won't find them getting all wrapped up in aggressiveand risky investment schemes. It is quite rare for a credit union to fail, but even if they did, they are insured.

They are also great for things like car loans. When my older brother was trying to buy a car, just a year after filing for bankruptcy, his big bank wouldn't even accept his application. Our credit union, however, gave him a very reasonable loan. I remember how proud he was the day we went to the credit union to make his last payment so that he could pick up his title.



answers from Dallas on

We just switched after much debate. We have been happy with it. We are getting more in the way of interest.

I imagine they may not work for everyone. We don't use ATMs. I think the last time we used one was well over 12 years ago. So we don't miss them.

And they often remind me that it will take a few days for deposits to clear. Again...not too much of an issue for us. But for people who need the money more immediately, I could see that being a problem. I haven't noticed the credit union taking any longer than our national bank chain to clear checks, but they remind us every time.

Our only other consideration was the limited locations. We were concerned about not having a bank available to us, if we were out of town and a situation came up. But we figured in the age of credit this isn't the issue it once was for people.



answers from Albuquerque on

In my opinion, credit unions used to be lovely little local institutions that had phenomenal service and customer interaction. Now they're just like banks. Sure - most are smaller than the huge banks, but a medium credit union operates very similarly to a medium sized bank. No reason not to switch to one, but don't expect that you'll suddenly get higher interest on your savings account, forgiveness if you forget to pay your credit card bill on time, and no wait on the phone when you call with a question.

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