Buying a home or refinancing a mortgage is tough enough without confusing ads from banks and big lenders. Credit unions can offer competitive rates compared to big banks because they’re member-owned, non-profit institutions. They focus on serving their members, not maximizing profits for shareholders.
But without big budgets and marketing departments, credit union rates aren’t always easy to find or compare. That’s why we built a daily-updated comparison of mortgage rates from over 120 credit unions across the United States.
Credit Union Mortgage Rates 30-Year Fixed Updating... Best Rate (APR) 5.49% -74 bps vs. National Avg Distribution 5.49% - 6.28% Best 5.49% Good 5.65% Median 6.03% Institutions 116 15-Year Fixed Updating... Best Rate (APR) 4.91% -60 bps vs. Nat'l Avg -59 bps vs. 30Y Distribution 4.91% - 5.95% Best 4.91% Good 5.13% Median 5.13% Institutions 119 Loading rate comparison table... Estimated monthly payment based on purchasing $400,000 home with 20% down, $567/mo taxes and insurance, and 1.65% closing costs. Click to customize Note: These rates are informational and not a commitment to lend. FinFam has no institutional affiliation and does not receive any referral fees.
When we bought our home, the big bank I’d been using for years tried to sell me on a mortgage with 7% APR. Turns out a local credit union was offering 5.5% for the exact same mortgage.
What surprised me most wasn’t that there were cheaper options, but that two mortgages can be exactly the same product, just with different packaging.
In the USA, the government buys almost all mortgages, requiring them to be standardized. So why the price difference? As explored in this Bloomberg Odd Lots episode about credit card rates, higher rates are mostly to pay for advertising and marketing. Big banks have marketing departments that non-profit credit unions don’t have.
That “exclusive” inbox offer from Chase or Wells Fargo isn’t generosity. It’s a bet that you won’t shop around. My goal with this tool is simple: help people realize they have options and potentially save thousands of dollars a year.
IMHO, a better world might have a single non-profit entity offering a standard rate to everyone. This would remove a layer of complexity and allow the housing market to operate more efficiently. In the meantime, bigger, for-profit brokers and lenders do have a couple advantages over smaller ones. May close loans faster, which matters in competitive markets like NYC/SF. Non-issue for refinancing. Might have better apps and servicing UX. They also routinely sell your mortgage to other servicers anyway, so that servicing UX is not guaranteed. Not all CUs will beat big bank rates, either. Use the dashboard and benchmarks to find the right lender.
It’s a little involved! 😅
Rates are collected throughout the day from the websites of approximately 120 credit unions. National benchmarks come from the St. Louis Federal Reserve Bank, aka FRED: 30-Year Fixed benchmark (15Y). These update weekly. Credit union eligibility data is manually curated from individual institution websites.
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