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An Overview of Credit Unions for the Fledgling Buyer

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Sometimes in the game of buying a home, teaming up with the traditional players isn't the best choice. Getting financing can be difficult and scary for first-time buyers, who-- even as they sign their names to binding 30-year contracts-- aren't really sure they "got the best deal." Consider then a visit to your local credit union as part of your home buying process. Credit unions are unique institutions that offer benefits to members unlike those of banks. We figured we'd let an actual expert explain those benefits, so we asked Tony Wong, Real Estate Services Manager of San Francisco Federal Credit Union, to help us out.

Q: Why should a new home buyer consider a credit union?
A: As a not-for-profit, member-owned financial institution, San Francisco Federal Credit Union offers members higher earnings and dividends in deposit accounts, such as savings, checking and CDs. Members pay lower interest on a variety of loans including home loans. Fees are less with no surprises.

Q: Can a first-time buyer save money using a credit union?
A: Yes, first-time buyers can save money. Whether a member has 20% down or 5% down, we charge the same rate of interest, where as traditional lenders will bump up the rate because of the higher financing amounts. We are also a participating lender with the Mayor's Office of Housing for First-Time Homebuyers. These programs assist borrowers with lower income and limited down-payment.

Q: Who can use this credit union?
A: Our field of membership includes anyone who lives, works, worships or goes to school in San Francisco.

Q: Can a credit union help when a traditional lender says no?
A: Unlike traditional lenders, San Francisco Federal Credit Union looks at each borrower's particular situation. We look for compensating factors and do loans that make sense and not just what 'fits in the box' (Fannie and Freddie guidelines). If credit was an issue, we ask for satisfactory explanations and try to make sense of what the borrower went through. Some may have excellent credit, but limited down payment. In those cases, we offer loans with mortgage insurance, meaning we can finance up on 95% of the value on qualified loans. We do not turn away our members. Our goal is to assist them with all their financing needs.

Q: Is the current interest at your institution better than/same as banks?
A: Our rates are typically at the lower range of the market and we have a 60 day rate lock.

Q: Anything else you want new buyers to know about your services?
A: The real estate department at San Francisco Federal Credit Union is here to make your "American Dream" of home ownership come true. Whether you're looking to refinance to a lower rate, cash out on existing equity against your property or looking for a pre-approval on a purchase, we can help you.

Find Your Credit Union
These higher earning rate, attractive loan interest rates, and lower fee transactions are typical of credit unions. Along with San Francisco Federal, an open member option is Provident, and Patelco services "employers and communities" in SF. More exclusive options such as San Francisco Firefighters and Police Credit Unions are employment specific.
· San Francisco Federal Credit Union [official site]
· All Curbed University coverage [CurbedSF]