Credit union home loans

Credit unions are smaller, customer-owned financial institutions operating in towns, cities and regions across Australia. For home buyers and property investors, getting a credit union home loan means banking locally and avoiding the Big Four banks while still getting a good deal on a home loan.

Because credit unions are smaller operations, it's a good idea to research one thoroughly before becoming a customer. But that's true of any financial institution.

Bank loans vs credit union home loans

To get more information about the various customer-owned banks (including credit unions, mutual banks and building societies), check out the Customer Owned Banking Association website. Of those, 76 are credit unions. There are plenty to choose from.

What are the benefits of getting a home loan with a credit union?

Go local

If you want to support a local institution rather than one of the Big Four banks, then a credit union is probably your best bet. It's the financial equivalent of shopping local.

The fact that credit unions often put money into local community projects and charities is another benefit.

Member benefits

Credit unions are run on behalf of their members. And many credit unions started out by servicing specific areas or specific professions. If you're a teacher, for example, you may find a teacher-specific credit union offers extra benefits suited to your work and finances.

Will I get a good rate?

Credit unions vary widely. Some of them offer very low rates that compete with the cheapest lenders on the market. And some simply don't. You really need to compare home loan rates and make sure you're getting a good deal.

How do I find the best credit union for me?

Finding the best credit union is a personal decision based on your needs and goals. The best credit union for a retiree in Newcastle could look quite different to the needs of a young property investor living in Townsville.

To find the credit union that works best for you, ask yourself the following questions:

• Does it have the products you need? Some credit unions offer an extensive suite of financial products, from credit cards to home loans to insurance. Others may offer a more limited set of banking services with only a few home loans to choose from.
• Does the credit union operate where you live? Some credit unions only operate in one town or city. You don't need to be living there to bank with them, of course. But if you want personalised in-branch customer service, you want to find a credit union where you live.
• How does the credit union support the community and its members? Consider the credit union's community work, the projects it supports and the benefits it offers to members.
• Customer reviews. Reviews from existing customers is a good way to gauge how good a credit union is, especially in terms of customer service.

Can I get a lower home loan rate with a credit union?

At Finder we track the market's lowest home loan rates every month. And lately, most lenders are offering quite competitive rates. There's very little distance between the Big Four banks, online lenders and credit unions.

We frequently find credit unions and small lenders offering some of the lowest rates around.

Getting a loan with a credit union doesn't mean you're guaranteed to get a better deal, but it doesn't mean you're missing out either. Once again, you need to compare and make sure you're getting a good rate.

Frequently Asked Questions

• What are loans in credit unions?

  Credit union loans are financial products offered by member-owned institutions. They typically provide lower interest rates and fees compared to traditional banks. Credit unions focus on serving their members rather than generating profits for shareholders, which can result in more personalised service.

• How big of a loan can you get from a credit union?

  The size of the loan you can get from a credit union depends on your financial situation, credit history and the credit union's lending policies. Some credit unions may offer loans up to 95% of the property value, similar to traditional banks, but this can vary widely.

• What is the best credit union bank to join?

  The best credit union for you depends on your specific needs, including the loan products you're looking for, the type of customer service you want and your location. Some of the well-regarded credit unions in Australia include CUA (now Great Southern Bank), People's Choice Credit Union and Bank Australia.

To make sure you get accurate and helpful information, this guide has been edited by Joelle Grubb as part of our fact-checking process.

Written by

Richard Whitten

Money Editor

Richard Whitten is Finder’s Money Editor, with over seven years of experience in home loans, property and personal finance. His insights appear in top media outlets like Yahoo Finance, Money Magazine, and the Herald Sun, and he frequently offers expert commentary on television and radio, helping Australians navigate mortgages and property ownership. Richard holds multiple industry certifications, including a Certificate IV in Mortgage Broking (RG 206) and Tier 1 and Tier 2 certifications (RG 146), as well as a Graduate Certificate in Communications from Deakin University. See full bio

Richard's expertise

Richard has written 594 Finder guides across topics including:

• Home loans
• Property
• Personal finance
• Money-saving tips