Credit Unions: Any disadvantages?

[Leonidas]

Gosh, Leonidas, don't most Cops have a huge ego? That's been my experience. I don't mean that as a put-down by any means as I really have enjoyed my relationships with the few policemen I've known.

I guess citizens perceive cops as having big egos, but I know that cops think that narcs have huge egos, and I was a narc for almost half my career. My ego wasn't the biggest, but it was oversized.

One of my bosses promised me my choice of new cars if I could pull off something everyone thought impossible. I did it and chose the most expensive thing I could find in the GSA catalog - a Ford Expedition. It was the first or second year it was available and it was the biggest thing around. I got it in black, 4-wheel drive and limo tinted windows. When it was delivered I caught my boss, my secretary, some of my peers and subordinates all standing around it in the garage.

My boss: Why did he want something this big?

My secretary: So he could haul his ego around.

Three other people at the same time: He better get a trailer!

I've been in remission for years, but you never are really cured.

 

[BigMoneyJim]

I don't think I've had a bank account the past 10 years. I have two credit union accounts, PenFed and one from a previous employer. There isn't a native branch within a few hundred miles, but my ex-employer credit union participates in shared branching, so I have a few local places I can go to deposit checks or withdraw up to $1k cash per day.

PenFed apparently has some scan-to-deposit-a-check feature, but I haven't tried it as I very rarely get checks.

I discovered that credit-union-issued credit cards are less annoying to me than most bank-issued cards, so the only cards I currently use are two credit union Visas, a Costco AMEX and a corporate AMEX for work. (Bank-issued card annoyances consist of lots of extra snail mail with "special offers" and insurance deals where I can pay them to make sure they get paid if I don't pay them. Huh?)

Besides a check every year or two I've had little reason to visit a branch as a customer. I've been to hundreds of bank branches supporting their IT infrastructure, and it bowls me over how many people visit banks and how many banks there are. I've seen two banks and a credit union side-by-side-by-side in a strip mall with another bank on a pad site in the lot. (Not to mention the banks across the street.) So apparently a lot of people find a need in bank branches that I seem to be missing out on.

 

[robjr100]

Move Your Money

I`ve been with a credit union for over 30 years.I`ll never do business with a big bank if at all possible after the flim flam game they pulled the last decade.

YouTube - MOVE YOUR MONEY

 

[Orchidflower]

Related to that - often when you move investment accounts around you need a Medallion Signature guarantee. It is similar to a notarization except that a bank officer is taking responsibility on behalf of the bank for any signature fraud. They usually will only do this for an existing customer they have a history with.

I have had to do this a couple of times in the last few years when changing brokerages, transfering largish amounts ($60k), and when changing registration to our living trust.

In each case the bank did it but the credit union said they could not. The Medallion program does allow credit unions to do this but many do not because of the risk. But most banks will.

I've never had an issue getting something notarized at a CU though.

OMG, you are so right: it is a Medallion Stamp that the credit union couldn't do and not a Notarization. Back on the drugs, Orchidflower...and get some good, strong ones....geesh...sorry about that.

 

[Orchidflower]

Leonidas, I don't think it was your ego that had to be pretty big to be a narc, but you'd have to have a set of something else mighty big below your waist to do that job for so many years. God bless...

 

[Finance Dave]

No disadvantages and potentially many advantages (lower fees, better rates, etc.). CU's have NCUA insurance coverage of $250,000 - similar to FDIC insurance at banks.

Yes, there may be a disadvantage. Many credit unions don't have access to some of the more fancy "services" as the banks do. For example, I went to buy Euros last week for my trip to Germany next year (wanted to lock in the rate). My credit union does not sell foreign currencies. Local banks do sell, but you must be a customer with a minimum history and balance of x.

That may be a small disadvantage...but nonetheless don't let people tell you there are no disadvantages.

 

[ronocnikral]

Yes, there may be a disadvantage. Many credit unions don't have access to some of the more fancy "services" as the banks do. For example, I went to buy Euros last week for my trip to Germany next year (wanted to lock in the rate). My credit union does not sell foreign currencies. Local banks do sell, but you must be a customer with a minimum history and balance of x.

That may be a small disadvantage...but nonetheless don't let people tell you there are no disadvantages.

of the 7 countries (8 if you count canada) i have been to in the past 3 years, all have atm's and all will accept a credit union atm card (as long as you use a 4 digit pin number). even in the most remote parts of third world contries, the atm's were abundant and worked like a charm.

getting money from your bank before you leave is an expensive way to trade currency. and not needed. and if your card isn't working once you get on the ground, a simple phone call is easily made (and i've never had to place one). also, i still find greenbacks are happily accepted anywhere i've been in the last 3 years (covering 4 continents).

a non-issue in my book. of course, my major bank charging me fees and limiting me to $500/day withdrawing from an atm despite a 10 year relationship and a 5 figure account balance was a huge issue.

 

[Ronnieboy]

Love my credit union. Have been with them for 14+ years and going. No extra fees, interest on checking, low interest rate for loans, notary, etc.
I don't know why people stick with banks.

 

[Orchidflower]

Yes, there may be a disadvantage. Many credit unions don't have access to some of the more fancy "services" as the banks do. For example, I went to buy Euros last week for my trip to Germany next year (wanted to lock in the rate). My credit union does not sell foreign currencies. Local banks do sell, but you must be a customer with a minimum history and balance of x.

That may be a small disadvantage...but nonetheless don't let people tell you there are no disadvantages.

Any idea of what the minimum is you would have to have in a bank to buy those euros? That information is what I thought it might be. Thanks, by the way.

 

[thefinancebuff]

A credit union usually doesn't have as large an IT budget as a mega bank. The online banking interface may not be as smooth. There are bumps here and there. See my recent experience with Alliant Credit Union, which is one of the largest in the country:

Why a Credit Union Isn’t For Everyone - The Finance Buff

A bank can be as good as a credit union. Many like USAA. USAA is a bank, not a credit union. You don't have to have military affiliation to open a bank account with USAA. Many mentioned Schwab Bank in this thread. It's also a bank, not a credit union.

 

[TooFrugal]

The local credit union we belong to has much better interest rates on checking accounts than the local branch bank. The problem is that the CU puts holds on deposited checks often for several days and takes several days to process online bill payments. In order to pay off the occasional big charge bill may often require a 1 - 2 week lead time to deposit the money to cover the bill, wait for the hold to be released and then to process the online bill pay. I'm simply not enough of an advance planner to handle that.

The local bank rarely puts any holds on deposited checks and pays most bills from larger companies within 1 day. Plus the online bill pay interface at the major bank is simply more sophisticated than the one from the local CU.

So for us we keep money at the credit union to earn the higher rates on their reward checking, but I keep enough money at a local branch bank to pay most of the bills from the bank account because it is quicker and easier to use. Originally I planned to switch to the CU entirely, but for us that isn't turning out to be practical. That may not be an issue for other credit unions but it is what has kept us as customers at the local bank.

 

[lets-retire]

The local credit union we belong to has much better interest rates on checking accounts than the local branch bank. The problem is that the CU puts holds on deposited checks often for several days and takes several days to process online bill payments. In order to pay off the occasional big charge bill may often require a 1 - 2 week lead time to deposit the money to cover the bill, wait for the hold to be released and then to process the online bill pay. I'm simply not enough of an advance planner to handle that.

The local bank rarely puts any holds on deposited checks and pays most bills from larger companies within 1 day. Plus the online bill pay interface at the major bank is simply more sophisticated than the one from the local CU.

So for us we keep money at the credit union to earn the higher rates on their reward checking, but I keep enough money at a local branch bank to pay most of the bills from the bank account because it is quicker and easier to use. Originally I planned to switch to the CU entirely, but for us that isn't turning out to be practical. That may not be an issue for other credit unions but it is what has kept us as customers at the local bank.

Your credit union sux. Of the 6 credit unions I've been a member of none did what you are explaining. I'm not doubting what you are saying.

 

[OhSoClose]

Yes, there may be a disadvantage. Many credit unions don't have access to some of the more fancy "services" as the banks do. For example, I went to buy Euros last week for my trip to Germany next year (wanted to lock in the rate). My credit union does not sell foreign currencies. Local banks do sell, but you must be a customer with a minimum history and balance of x.

That may be a small disadvantage...but nonetheless don't let people tell you there are no disadvantages.

There are credit unions that do foriegn currency exchange. Like mine -- State Department FCU.

 

[Amethyst]

My CU will not redeem rebates issued in the form of debit cards. This is getting to be a nuisance, since nobody sends you a rebate check any more. I feel guilty taking the card to a bank where I don't have an account, although so far, the bank employees have been very courteous about exchanging the cards for cash.

Amethyst

 

[powerplay]

My credit union was able to do the Medallion stamp for me recently. I just called to check first before going there so I wouldn't waste the trip.

 

[TooFrugal]

Your credit union sux. Of the 6 credit unions I've been a member of none did what you are explaining. I'm not doubting what you are saying.

You are probably right. But they do have great rates on their reward checking so we are going to keep them for that only.

I guess if we switch credit unions in the future I know now what to ask. But back when we opened the account I didn't think to ask questions about things like bill pay times and hold times because it had never been a problem for us anywhere else.

 

[meierlde]

Yes, there may be a disadvantage. Many credit unions don't have access to some of the more fancy "services" as the banks do. For example, I went to buy Euros last week for my trip to Germany next year (wanted to lock in the rate). My credit union does not sell foreign currencies. Local banks do sell, but you must be a customer with a minimum history and balance of x. "

At least some AAA branches sell foreign currency, as well as some American Express Travel service offices (both Travelers Checks and currency) If you have an Amex card you can buy at the amex office. (Limits vary by the color of the card of course)

 

[BigNick]

Local banks do sell, but you must be a customer with a minimum history and balance of x.

Wow. You can walk into any European bank with non-drug-dealer amounts of US$ cash and convert it to Euros on the spot. Has Homeland Security declared that you need a background check to buy "furren" money?

 

[WanderALot]

Wow. You can walk into any European bank with non-drug-dealer amounts of US$ cash and convert it to Euros on the spot. Has Homeland Security declared that you need a background check to buy "furren" money?

I have never seen a limit in any US institution, but then again, I have never attempted to convert a large amount. The only Homeland Security directive that I've seen is that you have to let them know on your customs declaration if you bring greater than US$10K or equivalent in another currency.

 

[lets-retire]

I have never seen a limit in any US institution, but then again, I have never attempted to convert a large amount. The only Homeland Security directive that I've seen is that you have to let them know on your customs declaration if you bring greater than US$10K or equivalent in another currency.

It's actually a federal statute, not a DHS directive.