Banks will charge a higher interest rate and sometimes, they will refuse a loan completely for borrowers who have a credit score of 550 and less.
However, credit unions like Alliant Credit Union will charge lower fees and loan rates, even if the customer has a bad credit history.
Are credit unions better for auto loans?
Because of this, credit unions are often able to offer their members lower interest rates on loans than other types of lenders. In fact, auto loan rates at credit unions can be as much as 1% to 2% lower than the average rates offered by banks. You’re unlikely to find a better rate at a car dealership.
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