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How to Get Your Security Deposit Back from Your Landlord

Editorial Note: The content of this article is based on the author’s opinions and recommendations alone. It has not been previewed, commissioned or otherwise endorsed by any of our network partners.

This blog does not provide legal advice. If you need legal advice, please contact an attorney directly.

Here’s how I almost lost $900 — and my sanity — to a malicious New York City landlord. Without warning or reason, he refused to return my security deposit. It’s not a completely unique story, however.

“Calls about landlords and security deposits are one of the most common calls we get,” said Andrea Shapiro, Program Manager at Metropolitan Council on Housing, a tenants’ rights membership organization and hotline in New York City. “Mainly the landlord is just refusing to return it, but often people call because they are concerned it’s going to happen to them.”

In the end, I was able to get my security deposit back thanks to a lot of research and hard work. So if you find yourself in this same tricky situation, I hope that my story below, plus a walk through the steps you can take and some attorney tips, can help smooth the road ahead for you.

How I got my security deposit back from my landlord

It was my first time moving apartments, and I was new to the world of renting in New York. When I moved in, I had been told I would get my security deposit back 45 days after the end of the lease. Knowing that I had left my room in pristine condition, I naively believed that with processes seemingly already in place, my deposit would be returned to me promptly and smoothly.

But 45 days passed me by without a word from my landlord, and all my emails had gone unanswered. After 90 days, I started to get anxious. Finally I received an email from someone at the management company with whom I had never spoken. They did not know I had contacted them before, which apartment I’d lived in, my move out date, or the deposit amount. They were clearly grasping at straws trying to find a reason to not return the deposit.

Fed up, I visited the office in person to demand my deposit back. I still believed that the issue could be resolved civilly and smoothly. After a few phone calls and much shuffling of paperwork, the management company’s representative told me it was because I had moved out early (I hadn’t). She added that it was also because the current tenants hadn’t given their deposit (they had). I left the office, desperately wishing I had yelled “I’ll see you in court!” on my way out.

Left with no other choice, I filed a claim in small claims court and proceeded to gather all the documents related to my lease and apartment.

Then one afternoon, I received an email from the management company: “The landlord has instructed me to write you a check for your deposit amount and he would like for you to end the court case immediately.”

I knew I hadn’t won yet — I would wait until that check was deposited and cleared to celebrate. But after one two-hour-long office visit, six emails and several incompetent mix-ups later, I finally had my security deposit check in my hand, 10 months after I originally moved out of the apartment.

If you’re going through a similar ordeal, know that you’re not alone. There are plenty of resources available to help you get your security deposit back, too.

Here’s how to get your security deposit back from your landlord, from the innocent start to the tired finish.

How to get your security deposit back from your landlord

Confirm the legal deadline

State laws dictate how long landlords have to return a security deposit. For example, in New York, a landlord has 14 days after a tenant vacates the property, while Maryland landlords have 45 days after the lease ends.

To streamline the process, ask your landlord how they’ll return your deposit and give them a return address at the same time you tell them you’re moving out. Hopefully, that will prevent any further delays when it comes time to return the deposit.

Note, however, that in order to receive the full deposit back, there must not be any additional damage to the property, other than normal wear and tear. Otherwise, your landlord may choose to return only a portion of the deposit, if at all.

Communicate with your landlord directly

Contact your landlord directly to discuss the matter, especially if you disagree with their decision regarding your deposit.

“Written correspondence, either by mail or email, is almost always best,” said Ann O’Connell, attorney and Legal Editor at Nolo. “If you have pictures or video of the rental’s condition at move-in and move-out, or if you filled out a walk-through checklist, consider sending those to support your argument.” Start collecting receipts, invoices and pictures around now; they’ll be crucial evidence throughout this process.

O’Connell also recommended reminding landlords of the consequences they could face for wrongfully withholding a deposit such as severe fines, damages and/or court costs.

File a complaint with the attorney general

If you can’t reach an agreement or if your landlord stops responding, but don’t want to take it to court, try filing a complaint with your state’s attorney general first. The AG’s office can review the case and intervene on your behalf if your landlord has violated state law.

What you’ll need to get your security deposit back

Unfortunately, landlords can be tricky and may try to keep that deposit no matter what. This is where your evidence — receipts, pictures, emails — comes in handy. Collect any documentation that shows the deposit amount and that you paid the deposit, like a bank statement, invoice or receipt. O’Connell also suggested bringing a few copies of your lease or rental agreement to court, too. Print out all your correspondence with the landlord, especially relating to the security deposit. Make sure the print outs show the date and who sent the message.

In my case, I also had a letter of recommendation from the management company to my new landlord. It stated that I had made every rent payment on time and had left the apartment in good shape.

You may have the chance to bring witnesses to court. This isn’t always necessary, but if you have witnesses willing and ready to help you out, this could be a valuable asset. For example, if someone helped you move in and move out, they can testify to the property’s condition on both ends. Be sure to notify witnesses beforehand, so they’re not surprised by a court subpoena.

How to get your security deposit back from your landlord in small claims court

Typically, small claims court is the place to take your security deposit dispute, as it’s often for claims around $5,000 to $10,000.

File your claim

Small claims forms are either online or at your county’s small claims offices (see an example of New York City’s form here). You’ll typically need to provide your own information, including your name and full address, as well as the landlord’s full and correct name and address on the form, which you should confirm with the county clerk or your state’s secretary of state website before submitting. You’ll also indicate on the form the amount you’re suing for and the nature of the claim (your security deposit). You can either mail in your form or drop it off in person to the appropriate offices.

Once you file your claim, the court will serve the landlord with court documents. If your landlord is like mine, he’ll be scared of having a court case on his record and will hopefully pay up before you even make it to court.

“Most landlords don’t want to end up in court,” O’Connell agreed. “If you’ve been a good tenant and have at least a plausible argument, it’s likely you’ll be able to reach a compromise outside of court. Many times all it takes is a formal demand.”

Some states require you to serve the papers yourself or get someone to serve them for you. If you’re organizing it, make sure you follow all the court’s rules carefully.

“Serving the landlord with the correct documents and in the correct manner is very important,” O’Connell cautioned. “Failure to follow proper procedure can result in the court dismissing your case.”

You can serve papers through the U.S. Postal Service, courier service or a process server. A process server can be a proper officer, like a sheriff or marshal, or anyone not related to the case who is 18 years or older. Always obtain confirmation of delivery, especially if you’re using the post office or courier service.

Prepare for court

In addition to gathering evidence, O’Connell suggests sitting in the audience of a few small claims court trials, which are often open to the public. Observing a trial or two can give you an idea of what to expect.

If you plan to bring a witness or two, make sure you know what they’re going to say. You don’t want to be surprised by anything they say in court, especially if it weakens your argument.

Finally, you have one chance to sue your landlord, so know the facts of your situation inside and out. Perhaps create notecards with your main points for clarity and conciseness for when you speak to the judge. Organize your papers in order of how you’ll present them and make sure there are enough copies to go around.

Do I need a lawyer for small claims court?

Small claims courts are designed to be affordable with relaxed rules, making it easier for the everyday person to present their own case.

“Lawyers are rarely the right approach when it comes to small claims court,” said Michael Vraa, managing attorney and hotline director for HOME Line, a free tenant hotline in Minnesota. “They’re really designed for people, not attorneys.”

Some courts even make it hard for a lawyer to appear on someone’s behalf. So unless you have access to a free or low-cost lawyer, it’s probably not worth your time or money to hire a lawyer.

If you require a lawyer or extra legal help, several housing advocacy groups provide free or low-cost services to tenants, like HOME Line, Housing Rights Center (Los Angeles) and The Legal Aid Society (New York City).

Present your case in court

Show up to your court date prepared and on time. Check the posted schedule and wait for your case to be called. Once it’s your turn, you (as the plaintiff) will present your case first. Start with the basics of the case: the amount being pursued and the reason for the case. For example, start with something like, “This case is about the landlord’s failure to return my $900 security deposit without reason.” That way, the judge knows up front exactly what the case is about.

The judge will question you, the landlord and any witnesses. During your case, both you and the landlord will have time to speak. It’s best to not interrupt when someone else is speaking, even if they say something false or outrageous. Your case is stronger when you’re cool, calm and collected and presented with facts and evidence.

What happens if you win your case?

Congrats! Now what? “If you do end up in court and you win, as long as the landlord is reasonably professional (or cares about his or her reputation), they will most likely return the deposit as directed by the court order,” O’Connell said.

If the landlord still does not return the deposit, you might have to pursue collection efforts. This can get pretty involved, O’Connell said, and opens up another whole can of worms.

What happens if you lose?

You can usually appeal the decision, but it will depend on the law where you live. “You’ll have to do some serious evaluation about whether it’s worth your time and money to appeal or otherwise continue to pursue the matter,” O’Connell said. You may need to rework your argument, or perhaps you were in the wrong. Plus, as O’Connell added, “the chances of being successful on appeal are usually low.”

How to get your security deposit back from your landlord in mediation

Mediation is a lower-level alternative to presenting your case in court, especially if emotions or an informal agreement are involved. You can choose mediation ahead of your court date, or even sometimes day-of. Small claims court may automatically send some cases to mediation, as well. It requires both parties to sign a consent form and acknowledge that it is confidential and voluntary.

Instead of presenting your evidence to an unbiased party, like a judge, mediation focuses on hearing both sides and coming to a decision together. “Often, the people we see in mediation are just looking for more time to be heard,” said Samantha Adler, Program Manager for Civil Court Diversion, Community & Lemon Law at the New York Peace Institute. “We make sure there’s never a power imbalance in a room to even the playing field.”

Both sides get ample, uninterrupted time to provide their perspective. Throughout, the mediator doesn’t tell either side what to do, and often they don’t even make a decision. “Our model is to try to get parties to make a decision for themselves,” said Nick Schmitt, who also serves as a program manager at the New York Peace Institute.

If you reach a mutual decision, both parties sign a settlement agreement. If not, the case goes back to small claims. If you missed your scheduled court time, you’ll adjourn that date (which might have happened anyway if the court ran out of time, Schmitt said). Your mediator can provide further legal referrals and resources if you ask. Usually, though, “people end up leaving pretty content with what happened,” both Adler and Schmitt noted. Mediation allows both parties for more room to find areas for some give and take.

Advertiser Disclosure: The products that appear on this site may be from companies from which MagnifyMoney receives compensation. This compensation may impact how and where products appear on this site (including, for example, the order in which they appear). MagnifyMoney does not include all financial institutions or all products offered available in the marketplace.

Lauren Perez
Lauren Perez |

Lauren Perez is a writer at MagnifyMoney. You can email Lauren here

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Banking

Review of Cleo

Editorial Note: The content of this article is based on the author’s opinions and recommendations alone. It has not been previewed, commissioned or otherwise endorsed by any of our network partners.

Cleo is a budgeting app that serves as a sassy Siri for your finances. The app is a “chatbot,” which you interact with via text messages. Cleo makes a budget for you, helps you build savings and talks to you about your spending habits and your financial life. It also offers a digital wallet account for saving funds, and a form of overdraft protection.

While Cleo’s chatty approach to your finances make it stand out from competitors, its digital wallet product raises some red flags for us: The wallet pays no interest, and does not carry Federal Deposit Insurance Corp. (FDIC) insurance. If you’re serious about saving money, you need to understand the downsides to Cleo’s core features before using this app.

What is the Cleo app?

Cleo is designed to help you make a budget and stick to it. You connect your checking account to the app, which scans your transactions and analyzes your financial habits. Cleo spots spending trends and provides advice — sometimes brutally honest advice — about how you should be spending or saving your cash.

The chatbot functions of Cleo are central to how it works: You link your Facebook account to the Cleo app, which then chats with you via Facebook Messenger about your finances. You can ask Cleo for updates on your account balances, tell the app to build you a budget or have it set up reminders to reel in the spending on certain categories.

For instance, Cleo will tell you your spending by category, date or merchant. You can ask Cleo a question like, “How much did I spend on Uber this month?” or “Can I afford takeout tonight?” and the app will provide you with instant answers.

Cleo is headquartered in the U.K., and the company says it’s compatible with more than 3,000 U.S. financial institutions, including big banks like Chase, Wells Fargo, Bank of America and Capital One.

Cleo’s free features

Cleo offers two account tiers, a free account and a $5.99 per month account called Cleo Plus. The free account gives you access to Cleo’s budgeting tool and digital wallet, plus a weekly quiz with chances to earn cash rewards. The paid account adds in cashback rewards and overdraft protection.

Cleo budget tools

Cleo analyzes your finances and suggests a budget. It lets you adjust the budget plan to meet your needs. You must link Cleo to your checking account, although Cleo does not specify whether it can support more than one bank account. The app will identify recurring bills and send you reminders to pay them. The app only lets you set one budget — unlike some other budget apps that allow you to create different budgets for different categories. Cleo categorizes your spending patterns and provides regular summaries by category.

Cleo digital wallet

Cleo’s digital wallet lets you stash money in the account, but it does not pay an APY and does not offer FDIC insurance. The app prompts you set up recurring, automatic deposits into the wallet, and also lets you move money into this account on demand.

Note the company goes out of its way to remind users that this is not a savings account. Not being able to earn interest should be a deal breaker if you’re looking to seriously grow your savings — there are a number of high-yielding, online savings accounts that reward you with interest rates climbing over 2%.

The company states that in the U.K., funds stashed in Cleo’s digital wallet are held by U.K. banks Barclays and MangoPay. It is not clear which institution holds your wallet funds in the U.S.

When it comes to deposit insurance, Cleo “pledges” up to $250,000 in protection, although the terms of this pledge are not anything like the deposit insurance offered by the FDIC. Cleo says “… [the] pledge provides protection for up to $250,000 in losses to U.S. bank accounts and credit cards where the losses are attributable to sign-up and use of Cleo.”

Cleo weekly quiz

Every week, you can participate in a quiz with questions about your own recent spending and savings habits. If you get all the answers right, you’ll be entered to win a cash prize.

Cleo Plus paid features

For $5.99 per month you get Cleo Plus, an upgraded version of the app with the features above plus Cleo Cover, a form of overdraft protection, and Daily Cash, a cashback rewards program.

Cleo Cover lets you borrow up to $100 if you need a bit cash to get by or if your checking account is in danger of going into the red. No interest is charged on the loan amount, so long as you repay what you borrowed within three to 28 days later. Cleo determines your eligibility for Cleo Cover on a case-by-case basis, based on factors like your spending habits and whether you have regular income.

Cleo Cover comes with a major caveat, though: To get your Cover payment on the same day, Cleo will charge you a $3.99 fee. If you’re needing Cleo to spot you cash or cover an overdraft, chances are you need the money immediately.

Daily Cash provides cashback rewards on purchases you make from certain retailers. The app shows you the retailers you shop at most — and each time you make a purchase at one of those retailers, you’ll get up to 7% of your purchase deposited back into your Cleo Wallet. Other ways you can get cashback are shopping on the Daily Cash page in the app, and by completing challenges, like sticking to your budget or using the app frequently.

Advantages of Cleo

  • The app’s nonchalant, sometimes snarky tone makes managing your money a little less intimidating and a bit more fun.
  • Cleo provides a fast, convenient way to figure out if you can afford a certain purchase. Instead of sitting down and analyzing your budget, simply ask Cleo if you can afford it.
  • Cleo Plus’s added features — Cleo Cash and the cashback rewards program — could be useful for some users, if you understand the costs involved.

Downsides of Cleo

  • You don’t earn an APY on savings stashed in your Cleo Wallet. If you’d like to grow your money, these funds should be immediately stashed in a savings account that earns a decent APY.
  • Cleo “pledge” to protect up to $250,000 of losses “attributable to sign-up and use of Cleo” is a major red flag. This is not FDIC deposit insurance, and users should understand that if the company were to go out of business, any funds kept in the Cleo Wallet could be at risk.
  • Not being able to set different budgets for different categories — which is a feature of other budgeting apps like Mint — is a drawback.
  • It can take up to four days to transfer funds from your bank account to Cleo Wallet, and vice versa. That’s not a short amount of time.
  • The chatbot on the Cleo app is not very intuitive. After asking the chatbot several questions about how many bank accounts you’re able to link and whether Cleo Plus offers 2% interest on savings — something that is advertised on a company press release but cannot be found on its website — we received the same slew of auto-responses repeatedly. If you have questions about the app or the funds you have stashed in it, the app provides little to no direction on how to get in touch with an actual Cleo employee.
  • Facebook has had its fair share of privacy concerns. Cleo’s integration with Facebook could make you wary. If your Facebook is hacked, it could make your conversations with Cleo vulnerable.

Cleo vs. other budget apps

Cleo offers a little bit of everything that other fintech apps offer: Budgeting, saving, motivation, and cashback. However, Cleo falls short on delivering in each of these categories when compared with its competitors, proving that even if you can do everything, that doesn’t mean that you should.

Cleo vs. Mint

In terms of its budgeting component, Cleo falls short in comparison to Mint in the following ways:

  • Cleo’s budgeting tool doesn’t allow you to set up different categories for different transactions, something that Mint does feature.
  • In addition to allowing you to set up different categories, Mint lets you customize those categories by renaming them or recategorizing transactions, something that you can’t do with Cleo.
  • Mint’s budgeting tool is much more intuitive, and will automatically separate expenses like an ATM withdrawal and an ATM fee, filing those expenses under their designated categories.
  • Mint allows you to create custom alerts to notify you when certain bills are due. While Cleo gives you general budget notifications, you cannot set up custom alerts.

Cleo vs. Digit

As for Cleo’s saving money feature, the Digit app does the same thing and arguably does it better:

  • Funds in Digit are FDIC-insured, up to the legal limit. Funds in the Cleo Wallet are not insured. That’s a deal breaker when it comes to the savings you’ve worked so hard to build.
  • Digit rewards you with a 1% Savings Bonus if you save for three consecutive months.
  • Digit allows you to customize particular savings goals, something that Cleo lacks.

Cash back is something you can easily get with credit cards, which often offer cash back for spending done in entire categories, not just at specific retailers.

As for the motivating factor, Cleo does have a leg up on its competitors with its witty “roast me” or “hype me” money management feature — depending on whether you’re in the mood for some tough love or a pep talk.

Is Cleo right for you?

Cleo attempts to make money management more approachable by incorporating a chatbot with attitude and offering games — so if you’d rather get a root canal than craft a budget, it could be tempting to check out.

Your finances, though, are anything but a game. Cleo offers no interest, no FDIC insurance, potentially high costs on Cleo Cover loans and a bare-bones budgeting tool. The chatbot’s jokes can’t compete with a detailed budgeting app like Mint, high-yielding savings accounts offered by online banks and competitive credit card rewards programs. Take your money management seriously, and leave the laughs for other forms of entertainment.

Advertiser Disclosure: The products that appear on this site may be from companies from which MagnifyMoney receives compensation. This compensation may impact how and where products appear on this site (including, for example, the order in which they appear). MagnifyMoney does not include all financial institutions or all products offered available in the marketplace.

Sarah Berger
Sarah Berger |

Sarah Berger is a writer at MagnifyMoney. You can email Sarah here

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Banking

Credit Unions vs Banks: What’s the Difference?

Editorial Note: The content of this article is based on the author’s opinions and recommendations alone. It has not been previewed, commissioned or otherwise endorsed by any of our network partners.

Credit unions and banks are similar financial institutions, although there are key differences between them. Both banks and credit unions offer financial services like checking accounts, savings accounts, and certificates of deposit (CDs). They both offer mortgages and personal loans. But banks are for-profit companies, while credit unions are nonprofit institutions that serve their members and their communities. Read on to discover more about the differences between banks and credit unions.

What is a credit union?

A credit union is a not-for-profit financial institution that is formed by another entity, such as a corporation or community group. Ranging in size from small local operations to large nationwide networks, credit unions are owned and controlled by their members, who are also their customers.

Under the credit union business model, members buy shares in their credit union, and their deposits are used to provide loans and other financial products to each other.

A credit unions is run by a volunteer board of directors that is elected by its members. Credit unions are chartered by the National Credit Union Administration (NCUA) or by a state or federal government.

Credit Unions are growing in popularity: The assets of the average credit union have increased from $150 million to $260 million since 2012. Average membership at credit unions nationwide have grown by more than 20% since 2012.

How is a credit union different from a bank?

One of the chief differences between banks and credit unions is their ownership structures. Credit unions are owned by their members, while banks are owned by their stockholders. These different ownership structures dictate how these institutions operate. Credit unions serve the best interest of their members, while banks have a fiduciary duty to their shareholders, not their customers.

Credit unions and banks dispose of their profits differently. As for-profit institutions, banks redistribute their earnings to investors and shareholders. Credit unions use their earnings to reward their members by giving them dividends, discounted loan rates, higher interest rates on savings and investment products, and lower-cost services.

Unlike a bank, not everyone can open an account at a credit union. To join, you must meet certain criteria, which is often dependent on your employer, family, geographic location or membership in a group, such as a professional organization, school, church or labor union.

Finally, customer service can be another difference between credit unions and banks. Bank rules and policies are set by their boards of directors, who are often located in another city. Credit unions, on the other hand, are run by members, who are likely living in the community. In studies, credit unions often rank higher than most banks in terms of their quality of customer experience.

Feature

Credit Union

Bank

Management

Controlled by its members

Controlled by board of directors

Purpose

Serve its members

Make a profit

Revenue

Returned to members through dividends

Distributed to shareholders

Account holder rights

Account holders have voting rights

Account holders have no voting rights

Service

Account holders are members who can help set policies by voting

Account holders have no say in policies

Eligibility

Must meet eligibility requirements to open an account

Anyone can open an account

How to join a credit union

Finding a credit union near you is as easy as an internet search. You may be surprised at the number of credit unions in your area. The NCUA has a Credit Union Locator that can help you find a credit union near you. You can search by your address, the name of the credit union or by its charter number, which is a unique number assigned to the credit union by NCUA.

See if you are eligible

After you locate credit unions in your community, visit their website to learn about their eligibility requirements for membership. If the credit union does not include this information on its website, call or visit its physical location for more details.

In general, anyone who belongs to a certain community or organization may join the community’s credit union. Members typically share a common bond, such as

  • They work for the same employer
  • They live or work in the same geographic area
  • They have a family member who is a member of the credit union
  • They belong to the same organization, such as a religious group, school, labor union or homeowners association

Some credit unions are open to anyone and will approve membership based on charitable contributions. For example, you can join Alliant Credit Union by making a $10 donation to the Foster Care to Success Foundation.

Open an account

If you meet a credit union’s membership requirements, you can open an account by submitting proof of your identity, residence address and proof of eligibility. Then make the minimum deposit, which for credit unions will range from $5 to $25.

Is my money safe in a credit union?

In terms of safety, there really is no difference between depositing money with a credit union and depositing it with a bank, as long as the credit union is a member of the NCUA. The NCUA Insurance Fund provides members of federally-insured credit unions with a maximum up to the legal limit in insurance coverage, which is the same coverage the FDIC offers to bank account holders.

If you have more than one type of account ownership, such as individual accounts, joint accounts, revocable trust accounts and certain types of retirement accounts, it’s possible to qualify for more than the insurance limit in coverage.

Advantages of credit unions

  • Better interest rates: Because credit unions are not-for-profit organizations, they boast competitive rates and fees for their members, unlike commercial banks. Credit union members typically enjoy higher interest rates on their deposit accounts, as well as more affordable loan products.
  • Lower fees: According to the Credit Union National Association (CUNA), credit union members on average can save $102 every year versus banking with commercial banks. For example, credit unions charge about $3 less on average for each non-sufficient fund in a checking account than banks do, and almost $10 less for late payments on credit card debt.
  • Decreased closing costs: In terms of mortgage closing costs, people who use credit unions for loans pay $210 less than those who take out loans from banks.
  • Capped credit card rates: Credit unions have an 18% cap on how much interest they can charge on loans including credit cards, which distinguishes them greatly from traditional bank credit card issuers. Credit unions charged an average 11.82% interest rate on credit card debt; whereas commercial banks charged 13.65%.
  • Personalized loan reviews: If you’re building your credit and want to use a personal loan to establish or improve your credit score, a credit union may be more likely to work with you than a big bank. Members of credit unions may also be able to appeal credit decisions if they’re turned down.
  • A voice and vote: Your deposit in a credit union makes you a part of the ownership of the institution. Interestingly, in this structure, one person’s loan may come from another’s deposit. It also gives you the right to vote.
  • Access to nationwide ATM networks: If you are a member with a credit union, you have access to a national network called CO-OP, which has over 28,000 ATMs across the country and allows anyone who belongs to a credit union to access funds without a charge. This is more than what Chase has (around 16,000).

Disadvantages of credit unions

  • Limited access to branches: While some credit unions work hard to offer the same conveniences as banks, their branch locations are limited compared with megabanks. And you won’t likely find your credit union branch when you travel to another country.
  • Slower to adopt new technologies: Assets of some small local credit unions are often a fraction of those of big national banks. Some don’t even have their own website. They may also struggle to afford higher costs of adopting the new mobile banking technology, which can limit the need to visit a physical branch or ATM location.
  • Fees aren’t always lower: While some fees may be lower at credit unions, that doesn’t mean you can always save money in fees with a credit union. For instance, Chicago-based Alliant Credit Union charges an outgoing wire transfer fee — $50 for international and $25 for domestic. However, Chase Bank, which is also available in Chicago, doesn’t charge an outgoing wire fee for checking account holders.

Credit union vs bank: Which should you choose?

Choosing between a bank and credit union comes down to personal preference. Identify the services and banking experience that matter most to you. Consider things like customer service, online tools, branch location, interest rates and loan requirements. Make a checklist of the features in a financial institution that are most important to you.

Ultimately, it comes down to comparing products, services, fees and convenience. Remember, you can have accounts at a bank and a credit union. In some cases, this may be the best way to determine the right fit for you, allowing you to enjoy the best of both worlds.

Advertiser Disclosure: The products that appear on this site may be from companies from which MagnifyMoney receives compensation. This compensation may impact how and where products appear on this site (including, for example, the order in which they appear). MagnifyMoney does not include all financial institutions or all products offered available in the marketplace.

Stephanie Vozza
Stephanie Vozza |

Stephanie Vozza is a writer at MagnifyMoney. You can email Stephanie here