What to Expect from a Credit Union Car Refinance

When you decide you're ready to refinance your auto loan, you will have a lot of options to consider. You could go to a bank or an online lender, or you could decide to refinance with a credit union instead.

At Addition Financial, we have a deep understanding of the needs of our members. As a credit union, we pride ourselves on working with our members to provide them with affordable loan terms that work with their financial circumstances instead of against them. Here's what you can expect if you refinance your auto loan with Addition Financial or any credit union.

Affordable Membership Fees

If you are already a member of a credit union, you won’t need to worry about this first item. However, if don't have a relationship with a credit union, you will need to find one and join.

The good news here is that many credit unions have low membership fees and minimal requirements to join. For example, Addition Financial's membership fee is only $10. The only other financial obligation to join is an initial deposit of five dollars into a savings account.

The key thing to remember is that joining a credit union will not substantially increase the cost of refinancing your auto loan. The benefits are likely to outweigh the cost by a great deal.

Competitive Interest Rates

One of the best things about credit unions is they typically offer lower interest rates than banks. There’s a simple reason for that. Credit unions like Addition Financial are not-for-profit organizations. Our members own the credit union and we pass on our profits to them in the form of lower interest rates and affordable fees.

Of course, interest rates may still vary from credit union to credit union. For that reason, it is always a good idea to get quotes from several lenders at the same time, so you can compare them. Keep in mind that similar queries made in the same two-week period will be counted as a single query by the credit bureaus. In other words, your FICO score won’t be negatively impacted if you apply for a car loan at several lenders within a short period of time.

No Hidden Fees

Another hallmark of credit unions is that you won’t pay the same high fees that you might find on a traditional bank loan. Again, that is because credit unions are owned by their members, so they keep costs low.

At Addition Financial, we make sure that our members understand the fine print in our contracts. We don’t hide fees and we don’t try to trick anybody into agreeing to rates or fees they don’t understand. No lender should ever avoid questions or discourage you from reading a contract. Full fee disclosure is something to expect in any car loan transaction.

Speedy Underwriting

Once you have submitted your loan application, you will need to wait for it to be processed, reviewed and underwritten by the credit union.

Approval times vary and depend upon many factors. However, because member service is a priority – more about that in a minute – you will probably receive a faster response than you would with a bank loan. When you submit your application, ask for an estimate of how long it will take. They should be able to give you a timeline and stick to it (within reasonable limits).

Stellar Member Service

Big banks tend to prioritize volume and profits over caring service. They’re in business to make money and it’s common for them to de-emphasize the customer as a result. However, the reverse is true with credit unions. Since the members are also the owners of the credit union, service is a priority.

What that means is you should have a dedicated loan officer who welcomes your questions about your loan and will update you on the progress of your application as it moves through the approval and underwriting process.

Of course, you should also expect excellent service after your loan is in place. You may have questions at any time during the term of your loan and it’s reasonable to expect that your credit union will provide answers and support.

There are significant benefits to refinancing your car loan with a credit union instead of a bank. You can expect lower interest rates and fees, a speedy underwriting process and the highest possible level of caring personal service.

To learn more about Addition Financial’s competitive car loans, including options for refinancing your current auto loan, please click here now.