Benefits of Credit Union Credit Cards

August 23, 2019 | Mission Fed

Family at the airport waiting for their flight.

Credit cards can be the proverbial double-edged sword. They are great for paying off large amounts in realistic increments with the freedom to fund large projects that would, otherwise, run over budget. Yet, they also come with some of the highest interest rates of any financial option, and their fees can keep people trapped in a cycle of debt and interest.

This is true for traditional credit cards issued from large for-profit banks. But there is another option: credit union credit cards.

Member-Run Organization

The first question to answer is: How are credit unions different from traditional banks? The most significant factor is that they depend on and are operated by their members. Instead of an enormous bank that is beholden to shareholders, credit unions are nonprofit organizations. This affects the relationship between the organization and its members in a variety of ways, including:

  • Fee structures with many unknown or hidden fines.
  • Customer service that places the member first.
  • Loans that are designed to help members.
  • Credit union credit cards that compete with big banks.

Hidden Fees

You could simply call these “fees,” but if you have ever switched from a member-friendly credit union to a large bank, you know why they are considered hidden. Unless you comb through the fine print with a thorough eye, chances are you are going to miss one of them.

The following are a few fees that most conventional banks allow.

  • Overdraft fees
  • Monthly maintenance fees
  • Card Replacement Fees
  • Paper statement fees
  • Account closure fees

Customer (Member) Service

When it comes to credit unions, you are a member—not a customer. The way credit union employees treat their members is one of the most appreciated aspects of joining a credit union.

Loans

The interest made off loans is the primary source of income for large banks. Because the primary goal of for-profit companies is making money, loans are often doled out with less precaution than required. For example: The 2008 housing crisis.

Credit unions, on the other hand, are preferred by most because they have fewer fees and competitive annual percentage rates (APR).

Credit Union Credit Cards

While on the topic of borrowing money, credit union credit cards are also the perfect example of how credit unions design their programs with their members in mind. These credit cards come with many benefits.

  • Quality rewards program with points that are easy to acquire and spend.
  • Rates that are adjustable to compete with big banks.
  • No hidden credit card fees.
  • Plenty of ATMs to use across the country.
  • Active security measures to protect against credit card fraud and identity theft.

Rewards Programs

While not all credit unions offer extensive rewards programs, Mission Fed does. There are many benefits to the Mission Fed rewards program, including:

  • Easy to earn points – There are numerous local businesses that allow you to earn bonus points for shopping.
  • Easy to redeem – Using your rewards points is as simple as going online to the Mission Federal website or by using the mobile banking app. Scroll through the possibilities and click on which reward you fancy.
  • Points redemption – Save them up or spend as you go. There are a variety of choices on which you can spend your points:
    • Hotels
    • Airline tickets
    • Holidays and travel deals
    • Gift cards
    • Cashback
    • Green products and more
  • No annual fee – Most credit card companies only offer reward programs after forking over an annual fee. Mission Fed does not require a fee for their rewards program.

Competitive Rates

Credit union credit cards also offer competitive rates compared to the traditional banks. Because of credit unions’ demand in working for and with their members, interest rates can also be modified. This can really help steer you out of a financial pinch.

Avoid Credit Card Fees

When it comes to deciding between a credit union or a large bank credit card, the answer can be found in the fees. Credit cards are notorious for hidden fees, excessive charges, and continuing that cycle of debt. With credit unions, here are some costs you can avoid:

  • Reward recovery fees
  • Rebate fee
  • Reward redemption fees
  • ATMs

ATMs

One of the biggest complaints people have of credit unions is in the limited number of ATMs they have available. However, most credit unions are in the Co-op Network. This is an organization with 28,000 affiliate credit unions around the globe with access to shared ATMs — Mission Fed being one of them.

Perks of credit union ATMs are:

  • No ATM fees
  • 5,500 7-Eleven locations
  • 500 Walgreen’s locations in California alone
  • 800,000 ATMs worldwide
  • Text message network available to find nearby ATMs

Credit Card Protection

Most credit union credit cards (including Mission Fed cards) come with various protections to ensure your identity and account information are protected.

  • Enhanced ID Theft Protection
  • Zero Liability
  • 24/7 customer service

Other Benefits of Choosing a Credit Union

Beyond credit cards, joining a credit union comes with many benefits. Credit unions are also known for providing:

  • Financial education to its members
  • Comprehensive loan applications
  • Presence in their community
  • Equal voting rights to their members

Financial Education

This is a hard truth and may be tough to hear, but banks benefit from people being financially uneducated. They profit when people do not understand how credit card debt racks up, how high-interest loans are likely to default, or how hidden fees can turn their bank account inside out.

With credit unions, that will be the opposite case. If the members of the credit union collectively provide too-good-to-be-true loans, and they allow their members to default on loans, the credit union would crumble.

Credit History Is Not Everything

If there is a low-interest credit card available or a select home loan APR, but you do not qualify for it due to past financial troubles mucking up your credit history, not all hope is lost. Many credit unions will allow “second-chance” applications to provide an in-depth justification for why you believe you qualify for certain credit cards or reward programs.

This is the opposite treatment of what you would find at an institutional bank, where the only things that matter are:

  • Credit score
  • Payment history
  • Past financial record

Presence in the Community

When you join a credit union, you join a financial institution that has a strong presence in the community. Local credit unions will often fund local businesses and offer their communities incentives for signing up.

Voting Rights

As a member of a credit union, you are an integral part of deciding how it should run. Whether you have $100 in your account or $100,000, you have an equal say in determining who the next board members for the credit union will be.

Mission Fed Credit Cards

Mission Fed offers five credit cards for their members. Each comes with a different APR for purchases and unique benefits.

  • Preferred Platinum Credit Card comes with 9.90% APR and 11.90% for cash advances.
  • Platinum Credit Card offers 11.90% APR with 13.90% for cash advances.
  • Classic Credit Card comes with 15.90% APR and 17.90% for cash advances.
  • Classic Credit Card Share Secured offers 16.90% APR and 17.90% for cash advances.
  • Mission Choice Credit Card offers 17.90% APR for both purchases and cash advances.

Getting Your Credit Union Credit Card Today

If you are looking to set up a line of credit with an organization that has you and your finances in mind, consider credit union credit cards. Not only are you joining an organization that is community driven and community focused, but you also enjoy all the benefits that come from credit unions. These benefits include low interest rates, no hidden fees, and the ability to communicate and work with your local branch to find the ideal plan for you.

The content provided consists of opinions and ideas and should be used for informational purposes only. Mission Federal Credit Union disclaims any liability for decisions you make based on the information provided. References to any specific commercial products, processes, or services, or the use of any trade, firm, or corporation name in this article does not constitute endorsement, control or warranty by Mission Federal Credit Union.

Sources

Forbes. 5 Credit Card Traps.
https://www.forbes.com/sites/sherylnancenash/2012/06/19/5-credit-card-traps/#e4fb8f270356

Debt.org. What is Predatory Lending?
https://www.debt.org/credit/predatory-lending/

Mission Fed

Mission Fed

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