Should You Get a Credit Union Credit Card? (2024)

FAQs

Are credit union credit cards hard to get? ›

You need a credit score of 700+ to get a credit card from most credit unions, though some credit unions have options available for people with bad credit or no credit history. There are credit union cards for every credit level, and some of the best credit union cards are only available to people with excellent credit.

Most credit card payments — including credit union credit card payments — are reported to the major credit bureaus. Paying your statement balance on time and keeping your balance low can be great ways to help build your credit. Members earn 2 rewards points for every dollar spent on purchases.

Credit unions typically offer lower closing costs for home mortgage loans, and lower rates for lending, particularly with credit card and auto loan interest rates. They also have generally lower fees and higher savings rates for CDs and money market accounts.

Credit limits for credit union credit cards are often lower than the limits that traditional banks offer, at least when you first open the card. Your limit should increase, though, once the credit union you're banking with sees that you are able to make your payments on time.

Why it's one of the hardest credit cards to get: The hardest credit card to get is the American Express Centurion Card. Known simply as the “Black Card,” you need an invitation to get Amex Centurion.

Credit unions tend to have fewer branches than traditional banks. A credit union may not be close to where you live or work, which could be a problem unless your credit union is part of a shared branch network and/or a large ATM network such as Allpoint or MoneyPass.

The lower interest can provide you major long-term savings, particularly if you carry a balance on your credit card from month to month. Many credit union credit cards come with travel insurance, extended warranty protection, or even price protection.

FICO^® Scores are the most widely used credit scores. Each FICO^® Score is a three-digit number calculated from the data on your credit reports at the three major consumer reporting agencies—Experian, TransUnion and Equifax.

There are many different credit scores available to consumers and lenders. FICO® Scores are the credit scores used by most lenders, and different lenders may use different versions of FICO® Scores.

Often, credit union credit cards come with no annual fees. They also usually help you avoid other fees, such as balance transfer fees. Additionally, where there are fees, they can be lower than a traditional bank fee.

Why do banks not like credit unions? ›

For decades, bankers have objected to the tax breaks and sponsor subsidies enjoyed by credit unions and not available to banks. Because such challenges haven't slowed down the growth of credit unions, banks continue to look for other reasons to allege unfair competition.

If you're just starting out, a good credit limit for your first card might be around $1,000. If you have built up a solid credit history, a steady income and a good credit score, your credit limit may increase to $5,000 or $10,000 or more — plenty of credit to ensure you can purchase big ticket items.

It's generally recommended that you have two to three credit card accounts at a time, in addition to other types of credit. Remember that your total available credit and your debt to credit ratio can impact your credit scores. If you have more than three credit cards, it may be hard to keep track of monthly payments.

A bank or credit union may make a soft inquiry on your credit when you open a new checking account to check for a history of fraud. These soft checks do not affect your credit score. However, in some cases, a bank may perform a hard credit check, which does affect your credit score.

In addition, credit union members are able to vote in policies and make decisions that are more friendly to borrowers. This means your credit union loan approval odds are often more favorable than they would be if you choose to work with a larger, more impersonal lender.