Credit unions have money to lend

My friend was shocked, "I just got my mortgage statement and they (the bank) lowered my home equity line of credit. How could they do that?" He's talking about the credit available. He's upset because he was planning to use the line this spring to make some home improvements. He couldn't understand why this happened when he's never even touched the loan in 5 years.

Well, that was about a month ago and lots more people have discovered their in the same spot as financial institutions tighten up lending. So what are you supposed to do if you've got good credit and a desire for a loan. Wasn't the financial bailout supposed to encourage lenders to give out money?

That was the theory and while nobody should have expected that bailout to turn things around immediately, consumers in search of loans are not seeing much change. And then there are credit unions.

Credit unions are waving their cash filled arms saying "we're here! we're here!" That's especially so when it comes to mortgages and home equity loans. That's because the majority of credit unions have been involved in the risky subprime mortgage mess.

As journalist Broderick Perkins tells it in Reality Times, an online real estate journal:

Credit unions didn't need a bail out during the Great Depression, they didn't need federal intervention during the Savings & Loan debacle and they don't need government assistance now.

Because of the cooperative structure of credit union there is little encouragement of excessive risk taking. As a result, credit unions experience extremely low net loss rates in general and even in current conditions. The conservative operating style of credit unions also explains why they remain very well capitalized today--thus ready to lend money now.

So if you're looking to purchase a home, take out a home equity loan or buy a car your credit union is ready and willing to lend. They'll also give you an honest loan that won't bite you later.