In Personal News, I Took Out a Loan From a Credit Union
How I navigated my first leap into lending
By Megan Guinane
Over the past year I began deeply researching my options for graduate school, a career-building step I’ve been interested in pursuing for awhile. Even in the earliest explorations, I quickly realized our Grad School Guru wasn’t exaggerating when she said “Graduate school is a higher standard of education, and the costs go up in every way”. After the grueling process of the GMATs, the lengthy application process, and multiple interviews, tuition was still looming in the distance. Although I’ve decided to take only two courses this upcoming fall semester, the cost was almost double what I paid for two undergraduate courses. Even the “Easy 5 Payments Plan” was still out of my range. I needed money, and I needed it fast.
I didn’t qualify for financial aid at my school since I am not in a full-time program, so I began to explore the different financing options out there. After countless hours of researching, and interviewing people about their experience taking out personal loans, I decided that I was going to become a member of my local credit union and take out a loan from there. Prior to this decision, I’d only had experience with big banks and I was nervous about starting a new account with a smaller bank. However, I was very happy that I was doing a small part to help boost my local economy and that helped ease my fears.
Becoming a member was easy — I went in, signed up, opened up an account, and deposited $5.00. As for the loan, I was actually shocked that I was able to get so much. My credit score is considered “fair” but I probably would never be able to take out a new car loan with it. I was also relieved to see that the interest rate was low, and my monthly payments were quite affordable. From there it was quite simple to get my tuition deposit check ready. I closed on the loan, put the balance of tuition in my new account, and printed a check addressed to my new school. It was great to have tuition for the year out of the way so I can concentrate on my studies.
Side note: They WILL run a credit report to see if you are eligible for a loan. This could take your credit score down a few points. However, the more on-time payments you make, the more your credit score will go up!
I know I am painting this experience out to be a fairy tale, but there are some drawbacks. Since this bank is on the small side, there aren’t as many resources available as with a big bank. For example, I have never even stepped foot into the bank that I have my personal credit card with because I can make all my payments online, and reach their customer service representatives 24/7. With this particular credit union, I can only make payments by check. I can mail the check, or visit the branch which is only available three times a week. I actually had to order checks because I haven’t needed to write one out in YEARS thanks to online payment systems like Venmo & clearXchange. They did send me a nice “payment coupon” booklet with a record keeper. Now I set one reminder on my phone to write the check, and another reminder to make sure that it has been received.
Even though I do not have the online convenience of a big bank, I am very pleased with my experience so far with the local credit union. They treat me like family and they know me by name. If you feel you are in a tight pinch for cash (especially for tuition like me), weigh your options and think of which type of loan will suit you best. Maybe you would feel more comfortable using the bank you’ve had since you were a kid, or maybe picking up a some freelance work sits better with you. Whichever pathway you choose, just remember to think everything through thoroughly!
