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Frequently Asked Questions

What's a Credit Union?

A credit union is a cooperative, not-for-profit financial institution organized to promote thrift and provide credit to members. It is member-owned and controlled through a board of directors elected by the membership. The board serves on a volunteer basis and may hire a management team to run the credit union. The board also establishes and revises policy, sets dividend and loan rates, and directs certain operations. The result: members are provided with a safe, convenient place to save and borrow at reasonable rates at an institution which exists to benefit them, not to make a profit.


Who owns a credit union?

Most financial institutions are owned by stockholders, who own a part of the institution and intend on making money from their investment. A credit union doesn't operate in that manner. Rather, each credit union member owns one "share" of the organization. The user of credit union services is also an owner, and is even entitled to vote on important issues, such as the election of member representatives to serve on the board of directors.


How did credit unions start?

The first credit union cooperatives started in Germany over a century ago. Today, credit unions are found everywhere in the world. The credit union movement started in this country in Manchester, New Hampshire. There, the St. Mary's Cooperative Credit Association, a church-affiliated credit union, opened its doors in 1909. Today, one in every three Americans is a credit union member.


What is the purpose of a credit union?

The primary purpose in furthering their goal of service is to encourage members to save money. Another purpose is to offer loans to members. In fact, credit unions have traditionally made loans to people of ordinary means. Credit unions can charge lower rates for loans (as well as pay higher dividends on savings) because they are nonprofit cooperatives. Rather than paying profits to stockholders, credit unions return earnings to members in the form of dividends or improved services.


Are savings deposits insured?

Yes. Your savings are federally insured to at least $250,000 and backed by the full faith and credit of the United States Government. NCUA, National Credit Union Administration.


Who can join Great Erie Federal Credit Union?

Persons who live, work, worship, or attend school in, and businesses and other legal entities located in Erie County New York. Also included are spouses of persons who died while within the field of membership of this credit union, volunteers in the community, and employees of this credit union, members of their immediate family or household, and organizations of such persons.


What are the advantages of credit unions?

Credit unions exist only to serve their member-owners. Surveys repeatedly show members are more satisfied with the service they receive from their credit union than a bank or savings and loan customers are with their institutions. Due to the fact that credit unions are democratic, member-owned cooperatives, members have the ability to direct credit union policy. If the majority of members are dissatisfied with the directors who set the policies of their credit union, they have the power to replace them.

Credit union elections are based on a one-member, one-vote structure. This structure is in contrast to for-profit, public companies where stockholders vote according to the number of shares of stock they own. The non-profit status of credit unions enables them to operate at a lower cost than many for-profit institutions and helps them to offer competitive loan and savings rates. In the October 2007 Consumer Reports publication, rated credit unions in the top 3 nationally out of 21 credit card providers surveyed. Credit unions provided better rates, fewer billing and interest rate problems and excellent problem resolution along with superior customer support and most credit unions do not charge an annual card fee.