Home Loan Services at a credit union are about the same as at a bank. The advantages of a credit union over a bank are lower interest rates, no application fees, and quicker decisions regarding approval. You will have the same options regarding fixed or variable rates, loan duration, and types of home loans. A bank has shareholders to answer to and must make decisions based on very specific criteria. A credit union is owned by its members and can be a bit more flexible regarding criteria for loans. There are still requirements and criteria for home loans at a credit union, but they are voted on by the members and tend to be more community oriented.
Loans can include a home equity loan, a home equity line of credit, a mortgage, or a second mortgage. A line of credit based on the equity in your home has a lower limit than a closed home equity loan. You can usually borrow twice the amount if you choose a closed loan with a 15-year term over a line of credit. Second mortgages can be for a primary residence or for investment property. You can choose the duration of the loan. Many credit unions, like Pearl Harbor Federal Credit Union, offers 7, 12, and 15-year terms for second mortgages.
If you are looking to purchase your first home, there are a few factors to consider. You need to save money for a down payment. The ideal amount is 20% of the purchase price of the house. That will get you a lower interest rate than if you only had 10% down. Also, calculate how much money you can spend on home costs each month. That should include the mortgage payment, taxes on the home, and home owner’s insurance. Some credit unions will combine those costs into one monthly payment for your convenience.
Home Loan Services are just part of the loan services offered by your local credit union. Automobile, business, personal, and student loans are also available if you qualify. Get criteria and requirements for you specific credit union and compare them to your local bank. You may want to consider joining a credit union if you have any plans to apply for a loan in the future.