Here at CreditCardForum, we are a huge fan of credit unions. That may seem counter-intuitive since we advertise cards issued by Discover and Amex, but the bottom line is when it comes to interest rates, credit unions frequently beat the big guys. Why? Because CU’s are actually owned by the members/account holders, so they’re not out to maximize profits like Wall Street bankers do.
Suze Orman on Larry King
In December of 2009, Suze Orman was on Larry King for the hour discussing all sorts personal finance issues, including credit cards. Orman talked about the outrageous interest rates some cards charge – like 30% – and how Americans need to put their foot down and stop doing business with the banks that do that. One alternative she discussed was credit union credit cards. When it comes to a standard non-promotional APR on purchases, they usually have the best credit card deals. Reportedly, the maximum APR a chartered credit union will charge is 18%… which is certainly less than the mid to high twenties that some big banks try and charge customers they deem “high risk.”
I’ve Had Great Experiences With Credit Unions
I’ve had excellent experiences with credit unions. I have my auto loan through Pentagon Federal Credit Union. The rate I’m paying is less than half of what the banks were offering at the time. I don’t carry balances on my cards, but if I did, I would almost certainly go with a credit union credit card. The one exception to this is balance transfer promotions – from my experience it seems that the 0% offers are longer with Discover, Amex, etc usually… but not always. As far as the standard (non-promo) purchase APR, usually CU’s win. American Express does give rates on some cards in the 7 to 8% range, but only if you have outstanding credit. Credit Unions are often more lenient in giving reasonable rates to those with less than perfect credit.