Ariana Huffington says, "Move Your Money"

I like to think that everyone reading this blog has a credit union account. But I also hope that some readers do not. My bigger wish is that your reading this blog will somehow translate to a recognition that credit unions want to help all consumers make the most of their money. And knowing that you might do the right thing and get your friends and family to stop supporting big banks and open a credit union account.

Ariana Huffington agrees, "When the big banks see real competition from the community banks and credit unions they will change their ways."

Huffington, founder of the Huffington Post, has taken her message to social media with Move Your Money. Huffington presents a sentimental and no-nonsense good-guy vs. bad-guy illustration to convey the message of smaller banking institutions. Naturally whenever this message is presented we get warm and fuzzies. But shouldn't doing the right thing feel good? It's time to fight back, people. Our weapons are cash. Recruit your friends and family from the pain of supporting big banks.

Spread the word follow Move Your Money on Twitter or join the fanclub on Facebook.

NOTE: the zip code search feature at this time only includes FDIC insured institutions. I have contacted Move Your Money to ask them to include NCUA insured credit unions. So don't be alarmed that Coors Credit Union does not come up in a search--no credit unions are listed. Here's a more reliable way to locate credit unions.

Should Banks become Credit Unions?

That's the question asked by Mike Garibaldi-Frick, writer for The Huffington Post. Here's a piece of the author's argument:

Banks are no longer the community based institutions they once were decades ago. Credit unions have taken over as the cooperative financial institutions that invest in their owner members' lives and businesses.

and this...

banks fear credit unions because they know if enough customers discovered the benefits of credit unions, they would be out of business.

Mostly Garibaldi-Frick is unhappy with the problems banks have had over the years. He'd like to see the banking industry nationalized. I can't say that nationalizing our banking system is a great idea. Meanwhile, we credit union members can enjoy the compliment.

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.

Bankrate.com reports credit unions are strong

photo by lord_bute

This weekend I had a nice opportunity to spend time around a backyard campfire with some former credit union colleagues. It was fun to just sit under the stars and listen to the crickets play their background music, but inevitably conversation had to turn to the common denominator between us--credit union business. As in any business there is always that struggle to market services and get more customers. But for once the old school way of credit unions is getting attention. Today Bankrate.com is running the headline Credit unions weather tough market. And just as my friends and I were discussing part of this is because of the way credit unions handle mortgage loans.

Here's what Bankrate.com had to say:

Data from the Credit Union National Association, or CUNA, a national trade association serving credit unions, show some interesting numbers at a time when the financial markets were struggling.

• Fixed-rate first mortgages increased $6.3 billion (annualized rate of 24.21 percent) during the first quarter 2008 compared with same period in 2007.
• Adjustable-rate first mortgages increased $2.3 billion (annualized rate of 12.04 percent) during the first quarter 2008 compared with the same period in 2007.
• Aggregate loan delinquency decreased slightly from 0.93 percent to 0.91 percent of total loans outstanding.
• Delinquent real estate loans in federally insured credit unions increased from 0.67 percent at year-end 2007 to 0.70 percent through first quarter 2008.

"For the first three months of 2008, loan originations by credit unions went up dramatically vis-à-vis where they were historically," says Walter O'Haire, senior analyst in the banking group at financial consulting firm Celent. "The large lenders still dominate, but credit unions went from having less than 2 percent of the first-mortgage market share to over 3 percent versus the first quarter of 2007.

Here's a summary of some of the things my friends said:

It's harder to get a mortgage loan now that banks have tightened up their policies...credit unions have always been more careful about who they give loans...people are finding credit unions are easier to work with right now...credit union mortgages are stable...the financial business is tough all around right now, but credit unions are doing well in the mortgage business...credit unions do have some foreclosures, but they are more rare.

Sorry guys, but anything is fair game for the blog and readers should know that credit union staffers trust in their credit unions.