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One of the most important factors of any loan is the interest rate. Unfortunately, for many individuals, finding a bank that’s willing to offer low-rate loans can be a challenge. Though it may seem wise to head to the largest bank in your area, relying on big-name recognition may cost you down the line. North Jersey Federal Credit Union in Totowa, NJ, wants to help you find the low-rate loans you need. Here, they explain how local credit unions will help you save on interest rates and provide customer service that blows big-name banks out of the water.

How Credit Unions Operate

Low Rate LoansUnlike traditional banks, credit unions are considered not-for-profit institutions. That means, there are no shareholders, publicly traded stocks, or other parties working to make money off the services at each branch. When you open an account at a credit union, you become a member-owner and are given a stake in the company. In this position, you’re entitled to vote on the board of directors, provide input on how the organization is run, and avoid fees other banks commonly charge.

How a Lack of Shareholders Leads to Low-Rate Loans

Traditional for-profit banks are almost always concerned with making their shareholders happy. This means, their focus is on generating as much revenue as possible—resulting in high-interest rates on personal loans, mortgages, and car loans. Remember, the higher the interest rates, the more money they get to keep in excess of your loan amount. Since credit unions do not have to answer to shareholders or pay dividends every year, they offer lower interest rates on loans and eliminate many standard operating fees found at conventional banks.   

Finding the right loan at a fair rate can be difficult, but with help from your local credit union, it doesn’t have to be. Let the team at North Jersey Federal Credit Union help you find the ideal low-rate loans for your needs. Their experienced personal loan specialists will work with you to secure the money you need with a payment you can afford. Learn more about their loan offerings online and call (973) 785-9200 to speak with a member of their staff.

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