How to Get Into a Credit Union

A credit union functions as a cooperative, not-for-profit financial institution that offers services similar to those of traditional banks. Its purpose is to promote financial well-being among its members. Unlike banks, which are typically owned by stockholders, credit unions are owned by their members. Earnings are reinvested back into the credit union to benefit members through services, rates, and reduced fees, rather than being distributed to external shareholders.

Understanding Membership Eligibility

Joining a credit union requires meeting specific membership eligibility criteria, often referred to as a “field of membership.” This criterion defines who can become a member. Eligibility can vary widely depending on the individual credit union’s charter.

Common eligibility categories include community-based membership, where individuals can join if they live, work, worship, or attend school within a specific geographic area. Employer-based eligibility is another frequent criterion, allowing employees of a particular company or industry to become members. This can extend to large corporations or specific professional groups.

Membership can also be association-based, where belonging to certain organizations, such as alumni groups, religious affiliations, or professional associations, qualifies an individual. Many credit unions offer family-based eligibility, meaning that if a close relative is already a member, other family members may also qualify to join. To determine specific requirements, individuals can typically visit a credit union’s website or contact them directly.

The Application Process

Once eligibility is confirmed, applying for credit union membership can be done online or in person. Applicants need to provide documentation to verify their identity and address. This typically includes a valid government-issued photo identification.

Proof of address is also required, demonstrated through documents like a utility bill, lease agreement, or other official document showing current residency. Applicants must also provide their Social Security number (SSN) or Taxpayer Identification Number (TIN) for identification and tax reporting purposes.

The application is available on the credit union’s website for online submission or at branch locations for in-person completion. New members are usually required to make an initial deposit to open a membership share account. This initial deposit, often $5 or $25, establishes the individual’s share in the cooperative.

What to Expect from a Credit Union

Credit unions operate as member-owned financial cooperatives, distinct from traditional banks. Individuals who hold accounts are not just customers but also owners. Members typically have a voice in the credit union’s governance, often through the election of a volunteer board of directors.

Upon joining, members gain access to a range of financial services and products. These commonly include checking accounts, savings accounts, and various types of loans such as auto, mortgage, and personal loans. Credit cards are also widely available, along with online and mobile banking services.

The operational focus of credit unions often emphasizes a community-oriented approach. Many members experience personalized service, as the institution’s primary goal is to serve their financial needs rather than maximizing profits for external shareholders.