How To Join A Credit Union With Bad Credit

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As you might expect, your credit history and credit score are particularly relevant when you are trying to become a member of a credit union.

However, you might not have the best credit score for whatever reason, but you still want to join a credit union.

Bad credit is not necessarily something that will completely prevent you from joining a credit union, though.

Here are some tips for you if you want to join a credit union even though your credit score isn’t very good at the time you want to join. 

1. Check Your Consumer Banking Report

Contrary to what some people may believe, your credit score is not actually the primary factor that is considered when you are trying to open a deposit account with a credit union in the United States.

Your consumer banking report is actually more important. Your consumer banking report shows the history of all the bank accounts that you have had, to some degree.

ChexSystems has this consumer banking report on you.

The consumer banking report from ChexSystems shows any past bank accounts that have outstanding debts, have been reported for a certain reason, or bank accounts that have been mishandled in some way. 

2. Recognize that Credit Unions Require Membership

Credit unions are different from banks in a number of ways.

One of these ways is that banks have customers while credit unions have members and this is because a credit union operates as a non-profit organization while a bank obviously does not.

A credit union’s earnings go back to the members of the credit union.

This may come in a number of different ways, ranging from higher deposit rates and lower account fees to lower borrowing rates.

It is also important to keep in mind that credit unions each have their own set of criteria to figure out if you are eligible for membership or not. 

These can vary from credit union to credit union.

However, in most cases, these requirements focus on whether you live, work, or worship in a certain area or not.

Additionally, your affiliation or lack of affiliation with particular organizations, groups, or companies might also affect whether you are eligible to join a certain credit union.

As you might have noticed, your credit score is usually not a part of the considerations when you are trying to join a credit union.

This is part of how you can join a credit union with bad credit. 

3. Consider Second Chance Accounts

Even if your ChexSystems report is not ideal, that does not mean you cannot get an account with a credit union.

Second chance accounts are specifically made for individuals that do not have the most positive history when it comes to their past bank accounts.

Most of the time, second chance accounts are available in the form of some kind of checking account.

However, second chance accounts are certainly different from more traditional checking accounts in a few ways.

A second chance account will most likely include a monthly fee that cannot be waived, which is often not the case with traditional checking accounts. 

Another important difference is that you typically cannot write paper checks using second chance accounts.

You still may have the ability to use your second chance account for both transfers and online bill payments.

Despite this, you cannot give someone a check as payment if you’re using a second chance account.

The reason for this is simply that this decreases the chance that you will overdraft your account and get a negative balance.

Thankfully, quite a few credit unions offer you second chance accounts. Second chance accounts help you improve your credit, so you can use all of a credit union’s services once you join it. 

4. Credit Unions Do Care About Your Bad Credit Sometimes

As previously stated, bad credit does not prevent you from joining a credit union.

However, you might find it more difficult to take advantage of some of the services that the credit union offers if your credit score is poor.

Bad credit does matter if you apply for a credit line or a loan with a credit union.

Bad credit can decrease your chances of qualifying for various types of loans such as credit cards, personal loans, auto loans, mortgages, home equity loans, and lines of credit. 

In general, though, credit unions are often more willing to work with you to assist you in getting a loan that you need if your credit isn’t great compared to banks. 

5. Secured Loans Can Prove Useful

If you are concerned about your bad credit affecting your ability to join a credit union or get approved for loans, secured loans can help you.

Secured loans are loans that utilize the money you deposit in them as collateral. You don’t have to worry about bad credit affecting your ability to get a secured loan.

This is because secured loans are much less influenced by your credit score or even your income since your own deposit is used as collateral to secure the loan.

Secured loans are also known as credit builder loans. 

Secured loans are called this because they are a good way for you to improve your credit as long as you ensure that you are making your payments on time.

You should know that your credit limit may be the same as the amount of collateral you have and interest rates on secured loans are usually quite low.

After you have used secured loans to rebuild your credit, you now have a better chance of getting approved for various kinds of loans once you have joined a credit union. 

Final Word

If you are someone who meets the membership requirements for joining a particular credit union, then you shouldn’t have to worry too much about your bad credit getting in the way.

Bad credit might make it harder for you to get approved for loans, though. Quite a few credit unions will work hard to give you the financial services and products that you need even if you do have bad credit. 

Want Flexibility? Try Online Credit Unions

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Money management has always been important, but today there seems to be a lot more options than there used to be.

Financial institutions operate both in-person and online.

Many options are only available online, and for people who don’t necessarily stay committed to a single place to live or work.

Taking care of your money mostly online is a great option.

Banks have done a lot with online banking over the years, but more and more credit unions are offering extensive online services.

Benefits of Credit Unions Vs. Banks

When you are choosing where to manage your money, you may ask whether a bank or a credit union is the best choice.

Profit Status

There are a lot of big high-profile banks that make it easy to find an ATM when you need it without having to pay a fee, but there are also some downsides of a traditional bank as well.

For one, banks are out to make a profit. This means they are more likely to charge higher interest on loans, and offer lower interest on savings and other investment accounts than a comparable credit union.

At the bank, your money works for the bank, at a credit union, you are the priority.

This means you can get better interest on loans, including student loans, they offer individualized debt consolidation, they offer resources to get educated about finances, so you get better with your money — rather than profiting from your errors with high fees. 

Credit Unions are non-profit institutions, and they take any money earned and give it back to the members.

People who manage money through a credit union are part of the credit union.

Credit union members also can often qualify for loans, or get better interest than those going through a bank.

How To Choose an Online Credit Union

Credit unions are not meant to be one size fits all, so it is important to put some thought into where you want to keep and manage your money to make sure you choose something that is a good fit.

When you become a credit union member, you become a co-owner of that institution, so it is important to pick something that you believe in.

Credit unions like for their members to have something in common, and some are more strict about your connection that others. Here are some things credit unions look for

The Industry you work in — Such as education, or another trade.

The company you work for — Many larger non-profits have their own credit union for employees

Where you live — Some credit unions are run by a certain city or state, or require that you reside in that state.

Your religion — Many strive to connection people of a similar faith.

Charitable Causes — Many credit unions are committed to advancing certain charities.

Family Connection — If a family member is a member, it is more likely you can be accepted as a member too, even if you don’t meet other requirements.

Look at Your Financial Goals

Before you join an online credit union, you should look at your financial goals.

Do you expect to buy or sell a home in the next few years? Do you need to save money so your child or grandchild can further their education?

Do you want to invest in a new business opportunity? Do you just want to earn a bit of interest with a checking or savings account?

What kind of minimum balance are you able to keep?

Knowing the answers to at least some of these questions can go a long way toward helping you choose the credit union that is best for you.

Be sure to look at plenty of options so you can weigh what works best for you.

If a specific credit union has attractive rates and features available, don’t be afraid to inquire, even if you don’t think it is an obvious fit.

Many credit unions have workarounds, or offer the option of donating to an important cause if they don’t otherwise seem like the obvious choice.

Consider How You Want to Access Your Money

There are some credit unions that may not have all the convenience of large banks, although many do have their own apps with plenty of bells and whistles.

Many offer debit cards, and will reimburse a certain amount of fees.

For some, it can be a benefit to actually work a bit harder to access money, because it may help some be more effective savers.

Best Online Credit Unions

Not sure where to start shopping for a new online credit union? Don’t worry, we can make some recommendations.

Here are some of our picks for the top online credit unions:

  • Connexus – good for high interest checking account
  • Alliant – good for high interest savings account and checking account
  • Golden 1 Credit Union – good for student checking account

Final Word

Just like banks, credit unions are federally insured, so your money is safe. You’ll also be given voting rights in many cases, which helps you steer the direction of the institution.

Overall, credit unions are more personal.

They are known for their neighborly approach. You invest in them and they invest in you.

You might start with just a savings or checking account, and find that they are there for you when you buy a home or start a business.

Even if you have had an account at the same bank for a long time, it is worth your while to cultivate a new relationship with an online credit union.

Best Credit Unions In Georgia (2022)

bank lobby

Credit unions can provide you with a number of advantages when compared to using the services of a traditional bank.

You can find many great credit unions in the state of Georgia. Here are seven of the best credit unions in Georgia. 

1. Robins Financial Credit Union

The first credit union on our list is Robins Financial Credit Union. This credit union was first founded way back in 1954.

It is the second-largest credit union in the state of Georgia behind only Delta Community Credit Union.

One reason why you might be interested in Robins Financial Credit Union is that its membership is based on the local community.

People that are living, working, or worshipping in the geographical area of Robins Financial Credit Union can become members of the credit union and utilize its banking services.

Robins Financial Credit Union also offers financial services to people that live or work in 40 counties, including Baldwin County, Crawford County, and Morgan County. 

2. Delta Community Credit Union

Next up on our list of 10 of the best credit unions in Georgia is Delta Community Credit Union. As previously mentioned, Delta Community Credit Union is the largest credit union in the state of Georgia.

This means that you can take advantage of the significant resources and knowledge at their disposal when you become a member of the credit union. It also offers you a variety of different kinds of accounts and loans.

Another reason why you might like to become a member of Delta Community Credit Union is that they are quite involved in the local community.

First, their partnership with Credit Unions for Kids allows them to support the Children’s Miracle Network.

In addition to this, Delta Community Credit Union has a Philanthropic Grants Program that aids young people and families in receiving the physical and financial education that they need. 

3. Georgia’s Own Credit Union

Transparency is one good way to tell if a financial institution is truly open about their dealings and if they truly have your best interests at heart.

If you are someone who values transparency, then Georgia’s Own Credit Union may be a good choice for you. Georgia’s Own values transparency deeply as part of its identity as a credit union.

To this end, Georgia’s Own gives its members annual reports, so they are aware of the credit union’s financial situation and what the credit union has achieved during that particular year. This credit union also created Georgia’s Own Foundation.

Georgia’s Own Foundation raises funds and volunteers for organizations that give children both healthcare and benefit children’s education. 

4. Atlanta Postal Credit Union

If a long history and tradition is the most important aspect of a credit union to you, then look no further than Atlanta Postal Credit Union.

Atlanta Postal Credit Union is the oldest credit union in the state of Georgia. As you might expect with this kind of history, Atlanta Postal Credit Union values the local community greatly.

That is the primary reason that their website states beliefs such as: “Everyone deserves a safe, sound place to conduct their financial business”.

Atlanta Postal Credit Union also offers its members a wide variety of financial products and services, so that is another reason why they appear on our list. 

5. Associated Credit Union

Associated Credit Union is another credit union that has existed in the state of Georgia for quite some time, founded back in 1930.

If you want to do business with a larger credit union in Georgia, then Associated Credit Union fits that description since it is the fifth-largest credit union in the state.

In fact, Associated Credit Union is actually owned by its members, unlike some other credit unions. You can enjoy a number of different financial products and services from Associated Credit Union.

One financial product that might appeal to you if you are a college student is a private student loan from Associated Credit Union and Student Choice.

Private student loans such as these offer no origination fees in addition to lower interest rates, as well.

The ACU Mobile App also lets you connect to Associated Credit Union regardless of where you are, so you can stay on top of your financial business all the time. 

6. Georgia United Credit Union

Georgia United Credit Union ranks as the sixth-largest credit union in the state, and it opened its doors back in 1958.

Georgia United Credit Union is also significantly involved in the community. You can see this with its School Crashers program.

The School Crashers program is designed to help K-12 schools in the state of Georgia and it does so with school improvement grants.

School Crashers has benefited 50 different schools over the past seven years and the grants have funded improvements valued at $1.4 million, according to the credit union’s website

Georgia United Credit Union also created the Georgia United Foundation. This foundation is a charitable organization that funds many programs including the School Crashers program.

It also funds the Junior Achievement program, which provides middle schoolers with an environment to learn about managing money to live within budgets through experience rather than just classroom education.

Team members can also earn volunteer hours for helping out at Junior Achievement Discovery Centers. 

7. LGE Community Credit Union

LGE Community Credit Union is another credit union that is owned by its members, so that is one reason why it might interest you.

You can also open both a standard account or Youth Savings and Young Adult Savings accounts with LGE Community Credit Union.

You can apply for different kinds of loans with this credit union, including personal loans, student loans, and even mortgage loans.

The LGE Foundation is one way that LGE Community Credit Union gives back to the community, and it has donated over $1.45 million to its communities since 2010, according to the credit union’s website

Best Credit Unions In Colorado (2022)

bank lobby

Many people decide to use credit unions instead of traditional banks because credit unions can provide unique advantages when compared to banks.

Additionally, credit unions are often much more involved with the local community than a traditional bank and some credit unions are actually owned by their members.

Regardless of why you are interested in a credit union, you can certainly find some excellent credit unions in the state of Colorado.

Here are six of the best credit unions that are located within the state of Colorado. 

1. Credit Union of Colorado

Credit Union of Colorado deserves its place as the first credit union on our list. Like some other credit unions, every single member is a co-owner since this credit union is owned by its members.

You can enjoy personalized service when you do business with the Credit Union of Colorado.

Credit Union of Colorado offers you a number of different financial services, including various kinds of loans such as auto loans and home equity loans, too.

You can also apply for a credit card or a mortgage with the Credit Union of Colorado.

Credit Union of Colorado also seeks to give back to the community through the Credit Union of Colorado Foundation.

This foundation awarded students $55,000 in scholarships in 2020 alone.

Credit Union of Colorado is an excellent choice for both its financial services and its commitment to the community. 

2. Credit Union of Denver

The Credit Union of Denver is another one of the top credit unions in the state of Colorado. You do have to either live or work in the surrounding Denver area to become a member of the Credit Union of Denver.

If you go to their website, you can find all sorts of financial solutions and recommendations for how to spend your money through the various stages of your life.

You can also take advantage of different kinds of loans if you join the Credit Union of Denver, ranging from home loans and personal loans to even loans for your business.

Additionally, you can even receive loans for your car or ATV with this credit union. 

The Credit Union of Denver offers you auto, motorcycle, homeowners, and life insurance as well. You can also use their online banking services for maximum convenience.

The Credit Union of Denver helps the community and has supported organizations such as the Children’s Miracle Network Foundation, Community College of Denver, Foothills Animal Shelter, and more. 

3. Ent Credit Union

Ent Credit Union opened its doors all the way back in 1957.

If you are looking for a credit union in Colorado with plenty of resources and locations, then Ent Credit Union might be right for you, since it is the largest credit union in the state.

You can open a checking or savings account with this credit union, as well as apply for many kinds of loans.

These loans include auto loans, student loans, mortgage loans, and even personal loans.

Ent Credit Union also offers its members financial education so that they can better manage their money. 

In terms of impacting the community, Ent Credit Union takes philanthropy seriously. Ent Credit Union has donated $1.2 million since 2019 to assist in funding pediatric mental health initiatives.

Ent Credit Union also supports the community through its Ent Youth Endowment Services (YES) grants.

Through these grants, Ent Credit Union has given $200,000 in 2020 to 43 not-for-profit organizations in the state of Colorado.

Ent Credit Union has awarded nearly $1.5 million in grants through its YES program since the program began. You can rest assured that Ent Credit Union is a community-oriented credit union. 

4. Bellco Credit Union

If you’re someone looking for a credit union in Colorado with a long history, then Bellco Credit Union is right up your valley.

Bellco Credit Union was founded back in 1936 and is currently the second-largest credit union in the state.

You might also like Bellco Credit Union if you’re someone who likes to bank on the go since Bellco Credit Union offers both online banking and mobile banking services.

You can also get home or auto loans through Bellco Credit Union, as well. You can even send money to other people quickly via Zelle. 

Bellco Credit Union values its local community and gave back in 2020 by providing a number of high schools with financial education and sponsored personal finance development and economic development classes for local teachers.

This helps give the teachers more tools to educate their students on these topics. Bellco Credit Union also works with the Food Bank of the Rockies to fight hunger in Colorado.

You might also like to check out Bellco Credit Union for their financial advice.

5. Canvas Credit Union

Canvas Credit Union is the third-largest credit union in the state of Colorado.

You can open savings accounts, moneymaker accounts, individual retirement accounts, and get certificates of deposit with Canvas Credit Union.

Of course, you can also open a checking account, as well. Canvas Credit Union offers personal loans like mortgages, vehicle loans, signature loans, and even student loans, too.

Canvas Credit Union gives back through its Canvas Cares program.

Their Community Scholarship program gives out $1,000 to 30 high school students every year from high schools that are in each of their Canvas Branch communities.

The Canvas Foundation Scholarship is another way they support the community. Canvas Credit Union awards two students $5,000 scholarships if they demonstrate strong character, promising leadership skills, and high ethical values.

You can even attend a free Financial Success Seminar if you are a member of Canvas Credit Union. 

6. Elevations Credit Union

Elevations Credit Union started off back in 1952 and is the fourth-largest credit union in Colorado. You can open either a checking or savings account with Elevations Credit Union.

You can also get a mortgage for your home and apply for a credit card with this credit union.

Elevations Credit Union also raised more than $500,000 in donations for victims of the March 22 tragedy in Boulder and added in another $200,000 so these victims’ families will receive more than $709,000 in donations.

You should also know that the Elevations Foundation has given out more than $2.67 million since 2010.  

Are Credit Unions Good For Bad Credit?

people withdraw money using machine

It’s no secret; having bad credit is no good. Bad credit can prevent you from doing everything from renting an apartment to starting a business.

While building or rebuilding your credit obviously takes time, there are various tools that can help you propel your finances forward. For instance, credit unions are one resource that is often used by people with bad credit.

With that in mind, the following is a look at why that is. 

Why and How Credit Unions Help People with Bad Credit

If you are someone who has bad credit, you may be wondering why working with a credit union is more beneficial than working with a bank.

Well, there are a few reasons for this. Some of which are the following:

Nonprofit Institutions

One of the top reasons people with bad credit should use credit unions is that they are nonprofit organizations.

So, unlike major banks, which charge for virtually everything, credit unions do not need to do this, as they are not for profit, to begin with.

Therefore, the products and services being offered are there for the good of the members rather than the good of the organization. This makes it ideal for anyone with bad credit. 

Working with People who Care

One major reason you should work with a credit union to fix your bad credit is that credit unions actually care and want to help.

Unlike banks, which have the sole goal of making money, credit unions are operated by members of the community, for members of the community.

Therefore, credit unions often offer many services and products that are geared towards helping people build or rebuild their credit.

This makes them ideal for people with bad credit who are trying to rebuild. 

Small Loans

Yet another way credit unions help people with bad credit is by offering small loans. They are also typically more lenient in terms of the parameters for approving these loans. 

Small loans can not only help you pay off bills and build your credit that way but repaying a loan is a great way to boost your credit.

This is because consistently making payments on a loan shows that you are financially reliable and responsible.

So, if you can get a small loan and commit to making the payments, you will see a moderate increase in your credit score over the months. 

Lower Fees

Another reason people with bad credit should work with credit unions is that they carry lower fees.

No matter if you are doing an ATM transaction or getting a loan, the fees you have to pay at a credit union will almost always be lower than the fees associated with working with a major bank.

Moreover, they also typically have a much lower minimum requirement to open and maintain checking and savings accounts and rarely charge fees for those who fall under a certain threshold.

Since those who have bad credit are also often experiencing financial issues in general, working with a credit union is a great way to save and pay bills without worrying about the astronomical fees. 

More Personalized Customer Service

Working with credit unions also gives you access to more personalized services.

Not only are credit unions known for being smaller and more intimate, but they also allow members to receive more personalized care.

This means they take the time to meet with members, discuss their unique financial needs and issues, and recommend the best services and products to help them get ahead.

This is a vastly different experience from what you will get when working with most banks. 

Voting Rights

Additionally, working with a credit union also gives you a voice.

Unlike working with major banks, joining a credit union affords you the right to vote on major issues affecting the bank.

This means that you can potentially vote for or against new policies that may work in your favor or against you.

This is ideal for people with bad credit as they are often the least considered when it comes to making major decisions in financial sectors. 

Insured Deposits

Lastly, federal credit unions, in particular, are insured by the National Credit Union Administration.

With the help of the National Credit Union Share Insurance Fund, many credit unions are backed by the U.S. government, which covers individual deposits of up to $250,000.

Therefore, you can save your money and invest in financial products with the peace of mind of knowing that your money is backed by the U.S. government. 

Final Word

Overall, there are plenty of reasons why credit unions are great for people with bad credit.

Not only are they nonprofit institutions that help by offering small loans and other products and resources designed to help individuals create financial freedom, but they also show compassion for individuals, have governmental protections, and lower fees.

Moreover, they provide each customer with a level of customer service that is almost unheard of when it comes to dealing with major banks.

Therefore, if you are trying to build your credit and need help doing so, joining a credit union may be the perfect way to do so.