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Motley Fool Promotes CUs as Best Places for Auto Loans
Thursday, February 5, 2015 6:40 AM

The personal investment website, The Motley Fool, recommends credit unions as consumers' best choice for auto loans this year in a Feb. 1, 2015, article. The article explains how credit unions operate under a not-for-profit structure that allows them to provide better interest rates on savings and loan products.

"Community banks fear them," the article states. "Big banks think they can crush them. But over the years, the credit union has proved resilient."

Car loans make up 32 percent of all credit union loans outstanding. "To win business, most credit unions price their auto loans at a fraction of the price that the nation's banks offer," the article stated. "It's not unusual for their rates to be 1-2 percent lower than most for-profit banks."

On average, used-car buyers would save as much as $398 by using a credit union, while new-car buyers who pick the lengthiest loan term would save $1,220.

"But if there's one thing you should take away," the article concludes, "it's this: Across the board, credit unions have much better auto-loan rates than banks do. Over time, the difference can add up to serious savings—savings worth shopping for."