In Houston, an individual has plenty of places to bank. The options usually breaks includes two categories: big banks and credit unions. Big banks are traditional financial institutions that are privately owned and publicly traded. They usually have higher fees and consider people who bank with them customers.
A credit union is a member-owned financial cooperative that is not-for-profit. A credit union offers the same products and services that traditional big banks offer such as checking and saving accounts. A credit union also has two categories: federal and general credit unions.
A General Credit Union in Houston
In a general credit union, also called a state-chartered credit union, memberships is required to open any accounts. The memberships are based on some kind of body such as employment, community or organization. The cost of the memberships are low. They range from $5 to 25. The membership fee gives an individual a share of the credit union.
What is a FCU in Houston?
An FCU is an acronym for federal credit union. An FCU, also called a federally chartered credit union, is supervised and regulated by the National Credit Union Association (NCUA). It is basically the same type of financial institution than a general credit union with some differences. For instance, both types of credit union offer basic banking services like savings accounts, loans, checking accounts and other financial products.
A federally chartered credit union is also requires a membership to join. The membership typically ranges the same amount of a general credit union memberships fees. The membership fee does purchase a share of the credit union ownership.
FCU and General Credit Unions are Regulated Differently
The main difference between a federally chartered credit union and a general credit union is how they are insured. A federally chartered credit union are insured by National Credit Union Share Insurance Fund. It is an independent agency. The funds in this agency are back by the U.S. government. It insures about $250,000 per investor. It is a rule that the FCU is not allowed to stop its federal insurance before notifying members.
However, a general credit union is not insured by the federal government. Instead, private insurers back the credit union. This means the deposits made at a general credit union are only backed by non-federal share insurance.
More Credit Unions are Federally Chartered Credit Unions
It may be difficult to decide which credit union to join because of the differences of how they are insured. Most credit unions are federally chartered credit unions because they are backed by the U.S. government. Thus, members will notice the NCUSIF and FDIC signs on the bank. However, a person who wants to become part of the state chartered credit union can find them. It may take a little researching.
Picking the Right FCU in Houston
A credit union is a great opportunity to be a part of something with a friendly atmosphere and is customer-centered. The hardest part is finding the right credit union. No matter which one is chosen, a member can’t go wrong.