You’ve heard of banks and credit unions, but do you know the differences between them? Should you choose a bank or a credit union? Both offer loans in Sparks, Nevada and a place to put your savings. The differences revolve around how the company is run.
You Are a “Partner” at Credit Unions
By placing your money in a credit union, you become part of the company. It works like a democracy, in that you have a say with how the company works, even if you only have $5 in your account. At a bank, you don’t have a say and you don’t benefit from the bank’s growth. At a credit union, any surplus money that comes in is distributed to you because you are a part of the business.
You Earn More Money
Banks and credit unions works the same way in that you put money into the institution and that money is then loaned out to other people. Those loans must be paid back with interest. That extra money is then distributed to you and other members as a payment for using your money to fund the loan. Banks usually provide less money to you because they also have to pay taxes and make a profit. Credit unions do not pay taxes and do not focus on profit, so there is more money to give you.
You Pay Less Money
Banks charge fees for almost every service. The interest rates on loans are higher than at credit unions. Banks charge more because they have more expenses and they want a profit. Credit unions charge lower fees, or no fees at all. Interest rates on loans in Sparks, Nevada and around the country, are lower, too. You pay less to use the credit union and to pay back loans.
Credit Unions are Smaller
Credit unions are most common in small towns and have few branches. You get to know the employees and they know you. The problem with the small size is that the company might not have as many loan choices and extra services as a bank.
Great Basin is one of many credit unions that offer these services. Make sure to check out both credit unions and banks before making any final decisions.
