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Credit unions offer a viable alternative to regional or national banks as personal and business financial institutions because they are owned and often directed by their members. Each credit union serves a specific field of membership based on location, education, employer, or association with a certain demographic, and they are structured as not-for-profit organizations. Because of this unique architecture, credit unions may be able to provide financial services and products at a lower cost than for-profit, shareholder-owned banks, a huge benefit of joining one. One such institution is Alabama Credit Union, serving individuals and their financial needs throughout the state.
Established in 1956, Alabama Credit Union began as a member-owned financial institution for the University of Alabama students, alumni, and faculty. Now, the credit union has expanded its reach beyond the university, providing a variety of products and services to those who fall within its field of membership.
Eligible individuals include those who live, work, or attend school in Blount, Baldwin, Cullman, Fayette, Hale, Jefferson, Lamar, Limestone, Madison, Marion, Marshall, Mobile, Escambia, Morgan, Shelby, Tuscaloosa, Walker, or Winston counties in Alabama. Additionally, membership is available to individuals who are associated with one of Alabama Credit Union’s Value Partner groups, or those who are related by blood or marriage to a current credit union member. The credit union operates 26 full-service branch locations throughout the state, as well as a vast number of fee-free ATMs to its members.
Alabama Credit Union offers several financial products to its members, including student loans, auto loans, personal lending, and small business lending.
Student Loan Products
In partnership with Credit Union Student Choice, Alabama Credit Union is able to provide qualified borrowers a range of products to meet their education funding or student loan refinancing needs. Alabama Credit Union offers the following options for students or graduates needing help financing their education expenses:
Undergraduate Student Loans
Structured as a line of credit, Alabama Credit Union’s undergraduate education financing is available for well-qualified borrowers with an interest rate as low as 6% or as high as 7.08%. The interest rate offered is variable, meaning it can fluctuate up or down over time. Students pursuing an undergraduate degree at an accredited university or college can borrow up to $35,000 through the line of credit and use as much or as little as they need to fund their education. Borrowers have the option to pay interest-only payments while in school, defer interest and principal payments until six months after graduation, or make full principal and interest payments during school. Standard repayment for undergraduate student line of credit borrowers is 20 years.
Graduate Line of Credit
Similar to undergraduate lines of credit, the Alabama Credit Union graduate student line of credit is a flexible financing option. A variable interest rate between 6 and 7.08% is offered to well-qualified borrowers, and students may be eligible for a credit line up to $35,000. Repayment terms can be interest-only while in school, principal and interest during school, or deferred until six months after graduation. The standard repayment term is 20 years for borrowers with less than $40,000 owed.
Student Loan Refinancing
Alabama Credit Union also offers student loan refinancing for up to $65,000 for undergraduate or graduate students. Interest rates for student loan refinancing are also variable, and range depending on the length of repayment. Five-year repayment loans have an interest rate between 4.25% and 6.25%; ten-year loan interest rates range from 4.75% to 6.75%; loans extending 15 years have an interest rate between 5.25% and 7.25%. All student loan refinancing loans includes a 0.25% interest rate reduction for establishing automatic payments.
Unlike federal student loans, all loans and lines of credit offered through Alabama Credit Union require a strong credit history. A co-signer may be added to a loan or line of credit if the primary borrower does not have a credit history that meets eligibility requirements.
Auto Loan Products
Alabama Credit Union also offers several solutions for auto loans to qualified borrowers. Vehicle loans are available for new and used cars, recreational vehicles, boats, and farm equipment, each with a fixed interest rate and a predictable monthly payment. Auto loans for cars that are less than three years old receive the lowest possible interest rate, currently advertised at 2.00% for a 36-month repayment period. Loans are available for vehicles up to 10 years old. Repayment can extend up to 72 months for vehicles up to three years old, up to 60 months for vehicles between four and seven years old, and up to 36 months for vehicles between eight and ten years old. Larger loans for farm equipment, recreational vehicles and boats are available with repayment terms extending up to 120 months. All borrowers must qualify based on credit history, score, and ability to repay.
Personal Loan Products
Members of Alabama Credit Union also have access to personal consumer loans for various financing needs. The credit union offers personal property loans without the need for collateral with an interest rate as low as 7.50% and repayment as long as 36 months. Lifestyle loans are also available without collateral with an interest rate as low as 6.50% and repayment extending to 36 months. Alabama Credit Union also provides lines of credit, overdraft, and installment loans to qualified borrowers with an interest rate as low as 8.50% and repayment of up to 36 months. Like other loans offered by the credit union, all borrowers listed on an application must have strong credit history and score and may be required to show proof of income.
Small Business Loan Products
Small business owners have options with Alabama Credit Union when it comes to financing large expenses. Building and property purchases, equipment financing, vehicles used for business purposes, and commercial property financing are all available through the credit union to businesses who meet eligibility requirements. All businesses apply for financing with the credit union must be able to provide the last three years of business and personal tax returns, a personal financial statement, and means to repay if necessary. Interest rates and repayment terms are dependent upon the type of loan requested, the amount of the loan, and the collateral used to back to the loan.
Author: Jeff Gitlen