Why the Best Mortgage Rates are From a Credit Union
Applying for a mortgage is a monumental step in many people’s lives. A home is likely the most expensive purchase you will ever make, so without securing a good rate and favorable terms, you can end up spending over the odds on interest and hidden expenses.
When weighing mortgage lenders, there are several important factors to consider. While low-interest rates and minimal fees are typically the main priorities, a straightforward application process, helpful loan officers, and bonus member services can help make mortgage repayments and financial management less stressful.
Credit unions are known for their low rates, minimal fees, and excellent customer service, making them a popular option for mortgage applicants.
Modern credit unions like T&I Credit Union offer similar financial products and services as banks, only at more competitive rates. Let’s take a more detailed look at why the best mortgage rates are from a credit union.
Lower Interest
Credit unions are not-for-profit organizations that their members own. Compared to banks and online lenders, they are focused on serving their customers ahead of their stakeholders. This enables credit unions to offer low-interest rates on auto loans, personal loans, and mortgages and provide higher interest rates on savings accounts.
The National Credit Union Administration (NCUA) puts out quarterly reports comparing interest rates for savings accounts and loans offered by banks and credit unions. These comparisons demonstrate that credit union mortgage rates are consistently lower than mortgage loans offered by banks, which means a lower monthly mortgage payment for you.
Since mortgages are typically paid off over several decades rather than years, interest rates contribute significantly to the overall loan amount. If you are focused on long-term savings, calculate the total interest amount over the entire loan term.
Higher interest rates paid over a shorter loan period may lead to larger monthly payments but lower the total interest paid overall.
Whether you’re purchasing your first property, upsizing, or downsizing, T&I Credit Union can help you secure a mortgage with excellent rates and affordable monthly payments. We also offer mortgage refinancing, home equity lines of credit, and home improvement loans.
Fewer Additional Fees
Another advantage of being a customer-centric financial institution is that credit unions can charge fewer additional fees for mortgage applicants. Some of the most common loan-related fees include:
Application Fee
This charge covers the expenses related to your original loan application, such as administration costs and the preliminary credit check. These fees vary between lenders.
Attorney Fees
If your financial institution requires an attorney to be present when the official purchase of your property is closed, you’ll need to cover these costs.
Closing Fee
Closing costs are paid to the organization that takes care of the closing process. Closing may be handled by the title company, an escrow company, or an attorney, depending on state law.
Prepaid Interest
Lenders often charge interest from the moment the mortgage is settled to the date of your first mortgage payment. This fee is typically due at closing and varies depending on the size of the loan.
Loan Origination Fee
This covers underwriting, administrative work, and mortgage processing. Borrowers can expect to pay approximately 0.5% of the total loan amount as an origination fee.
Although credit unions must also charge fees to cover certain costs, they are typically much lower. At T&I Credit Union, we keep loan-related fees to a minimum.
Higher Approval Rates
Credit unions take a personal approach when appraising your mortgage loan situation, enabling them to work with members who have average credit. However, all lines of credit are subject to a credit review and approval, from student loans to VA loans. Your financial circumstances and credit history directly impact your rates and terms.
Whether you require an affordable mortgage, refinancing loan, home equity line of credit, or home improvement loan, T&I Credit Union can help. If you’re worried about your credit history, get in touch with a loan officer to discuss your options.
We can help you create a financial management strategy to improve your credit or develop an affordable repayment plan to get you the loan you need.
Member Services and Customer Care
At T&I Credit Union, we go above and beyond to ensure our customers are financially supported at all times. As a member of T&I Credit Union, you can benefit from online banking, eStatements, a mobile app, online loan calculators, wire transfers, and debit and credit cards. We also offer bill pay services, ensuring you don’t miss a payment.
Our popular credit union rewards system allows you to earn points for every dollar you spend on your debit and visa cards. Rewards may be selected online through our uChoose Rewards page.
Some of our unique member services aim to improve members’ credit scores, reduce debts, and help qualify them for improved mortgage rates. We offer members and businesses free credit score analysis, identifying areas of improvement, problematic figures, and teaching you strategies to improve your financial future.
The T&I Credit Union financial tracker is an excellent resource that enables members to monitor financial progress, view account details, mark paydays and due dates in the calendar, and track their debts. More importantly, the tracker has a built-in function for creating financial goals.
By subscribing to T&I Credit Union member services, you can get control over your financial management and credit history.
Quality Mortgage Services from a Local Provider
T&I Credit Union is a financial institution based in the Detroit Metro area that serves the seven surrounding regions, including Birmingham, Royal Oak, and Troy.
As a member-run organization, we are governed by an elected board committed to providing mortgage loans at the best possible rates.
To begin your mortgage application process or get pre-approval while searching for your dream home, apply online, in person, or give us a call at (248) 588-6688.