Nonprofit financial institutions owned by their members, credit unions can be a better avenue to pursue a home loan than a traditional bank or other lender.
They often boast lower-than-average rates, discounted fees, multiple down payment assistance options and more personalized service.
Some credit unions are only available to select groups, like members of the U.S. armed forces. But many others are open to just about anyone.
CNBC Select reviewed dozens of credit unions to choose the best for mortgages, based on membership requirements, rates, availability and more. (See our methodology for more on how we made our selections).
Best credit unions for mortgages
Best for easy membership: FourLeaf Federal Credit Union
FourLeaf Federal Credit Union
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Annual Percentage Rate (APR)
Apply online for personalized rates
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Types of loans
Conventional, FHA, jumbo, refinance, HELOC
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Terms
Fixed: 10, 15, 20, 30 years, ARM: 5/1, 7/1, 10/1
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Credit needed
620 for conventional, 580 for FHA
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Minimum down payment
3% for conventional, 3.5% for FHA
Pros
- Free rate lock for 60 days
- Only need $5 deposit to become member
Cons
- Only has physical branches in New York
- Home loans not available in Texas
- No VA, USDA or home equity loans
Who’s this for? Anyone can join FourLeaf Federal with just a $5 deposit, making it one of the most accessible credit unions in the U.S.. It also boasts specialty loans many credit unions lack, including mortgages for condos, manufactured homes and investment properties.
Standout benefits: Borrowers can lock in their rate for 60 days for free.
[ Click here for more on FourLeaf Federal Credit Union ]
Best for veterans and military: Navy Federal Credit Union
Best for no down payment: Alliant Credit Union
Alliant Credit Union Mortgages
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Membership requirements
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Types of loans
Conventional, FHA, USDA, VA, jumbo, doctor, construction, refinance, HELOC
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Terms
Fixed rate: 15, 20 or 30 years; Adjustable rate: 5, 7 or 10-year initial period
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Credit needed
620 for conventional loan, 500 for FHA loans with 10% or more down and 580 for FHA loans with 3.5% down
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Minimum down payment
0% with Alliant Advantage Mortgage, 3.5% with FHA loan, 0% with VA or UDSA loan
Pros
- No application fee
- Zero-down payment option with no PMI
- Borrowers can get $6,500 if they use a partner real estate company
Cons
- Must live in select areas or work for partner company
- No home equity loans
Who’s this for? Alliant Credit Union’s Alliant Advantage Mortgage is a conventional zero-down home loan that doesn’t require PMI — an uncommon feature among any lender, credit union or otherwise.
Standout benefits: Borrowers can score up to $6,500 in cash if they find their home with Alliant’s partner real estate company.
[ Click here for more on Alliant Credit Union ]
Best for low rates: Connexus Credit Union
Connexus Credit Union Mortgage
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Annual Percentage Rate (APR)
Both fixed- and adjustable-rate loans available, apply online for rates.
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Types of loans
Conventional, VA, jumbo, construction, refinancing, HELOC, home equity loan
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Terms
15-, 20- and and 30-year fixed-rate loans; 3-year, 5-year, 7-year intro period for adjustable-rate loans
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Credit needed
620 for conventional, 640 for VA, 700 for jumbo or construction loan, 640 for a home equity loan or HELOC
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Minimum down payment
3% for conventional loans, 0% for VA, 10% for jumbo, 20% for construction loan
Pros
- Fully online lending process
- Has construction-to-permanent loans with ARMs
- Available in all U.S. states except Maryland
Cons
- Prefers 700 credit score
- $5 membership fee
- Only has branches in Illinois, Minnesota and Wisconsin
Best for first-time homebuyers: Andrews Federal Credit Union
Andrews Federal Credit Union Mortgages
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Membership requirements
These groups are eligible for Andrews Federal membership: Active duty or retired military personnel; people who work, live or worship in Washington, D.C.; people who work for an affiliated company; members of the American Consumer Council; people who are family of existing members. (More on membership)
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Types of loans
Conventional, FHA, USDA VA, jumbo, refinance, HELOC, home equity loan
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Terms
Fixed rate: 10, 15, 20 or 30 years; Adjustable rate: 5, 7 or 10-year initial period
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Credit needed
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Minimum down payment
3% conventional, 3.5% FHA, 0% with VA and UDSA loans
Pros
- First-time buyers can get up to $12,500 in down payment assistance
- Offers both home equity loans and HELOCs
Cons
- Only has branches in Maryland, New Jersey and Virginia
- Doesn’t offer construction loans or professional loans
What is a credit union?
According to the National Credit Union Administration, there are over 4,600 credit unions in the U.S.,
Because they’re not profit-focused, credit unions tend to have lower rates and fewer fees than banks or other lenders. They also have robust programs to help members on the path to homeownership.
You do have to join the credit union before you can apply for a mortgage: In some cases, that’s as easy as making a small deposit. In others, you must be employed by certain companies, be a member of a church or service organization or be part of the U.S. military.
At the end of 2024, credit unions collectively held $2.31 trillion in assets.Â
Credit unions vs. banks
While credit unions are similar to traditional banks, several things set them apart.
The chief difference is that credit unions are nonprofit, member-only institutions. Historically, credit unions were created to serve specific communities, businesses or regions, so they have a reputation for providing superior customer service.
Credit union vs. bank
| Credit union | Bank | |
|---|---|---|
| Structure | Nonprofit | For profit |
| Membership required | Yes | No |
| Branch access | Typically local | Typically national |
| Amount of product offerings | More limited | Wide variety |
| Deposit insurance | Yes, by National Credit Union Administration (NCUA) | Yes, by Federal Deposit Insurance Corporation (FDIC) |
You may have fewer loan options, but credit unions usually offer better terms because their profits are reinvested back into their products.
Like a traditional bank, money invested in a credit union is federally insured up to $250,000. Rather than the FDIC, however, the funds are guaranteed by the National Credit Union Administration.
How to join a credit union
All credit unions are membership organizations. In some cases, the requirements to join are nominal — a one-time membership fee or opening an account with a small deposit.
Other credit unions are limited to people who live in certain areas, work with an eligible employer or are affiliated with a labor union, school or religious group. You may also qualify if a family member is already in the credit union.
You can sometimes skirt stricter membership guidelines by joining a participating organization. You can enroll in Alliant Credit Union, for example, by joining the charity Foster Care to Success. (Alliant will even pay the $5 membership fee on your behalf.)
Pros and cons of credit union mortgages
Pros
- Lower rates and fewer fees
- Willing to work with borrowers with nontraditional income or less-than-stellar credit
- Focus on personalized service and community connection.
- May provide faster closing timelines.
- Unlikely to sell your mortgage to another company for servicing.
Cons
- Fewer branches and more limited online features
- Membership requirements may be stringent
- Some financial products offered by banks may not be available
More on the best credit unions for mortgages
FourLeaf Federal Credit Union
Bethpage, New York-based FourLeaf Federal Credit Union is one of the largest in the U.S., with 480,000 members. It started in 1941, serving workers at Grumman Aircraft but has expanded to include anyone who opens a savings account with $5 in it.
Membership requirement: $5 deposit in a FourLeaf savings account
Availability: FourLeaf Federal lends in all U.S. states except Texas
Loans: Conventional, FHA, jumbo, refinance, HELOC
Credit score: 620 for conventional, 580 for FHA
Down payment: 3% for conventional, 3.5% for FHA
[ Return to summary ]
Navy Federal Credit Union
Membership requirement: Active duty service members, veterans, Department of Defense employees and their families can join by applying and depositing $5 into an NFCU savings account.
Availability: NFCU lends in all 50 U.S. states and Washington, D.C.
Loans: Conventional, VA, Military Choice, Homebuyers Choice, refinancing
Credit score: Not disclosed
Down payment: 0% for VA loans, 5% for conventional loans
[ Return to summary ]
Alliant Credit Union
Launched in 1935 for employees of United Airlines, Alliant Credit Union now welcomes people who live or work in Chicago or are employed by partner companies. Anyone can join, though, with a donation to the Foster Care to Success charity. With 800,000 members, Alliant is one of the largest credit unions nationwide.
Membership requirement: A $5 donation to Foster Care to Success charity (which Alliant will cover)
Availability: Alliant Credit Union lends in all 50 U.S. states and Washington, D.C.
Loans: Conventional, FHA, USDA, VA, jumbo, doctor, construction, refinance, HELOC
Credit score: 620 for conventional, 500 for FHA with 10% down
Down payment: 0% with Alliant Advantage Mortgage, 3.5% with FHA loan, 0% with VA or UDSA loan
[ Return to summary ]
Connexus Credit Union
Founded as the Employers’ Mutual Credit Union in 1935, Connexus funnels profits into high yields for savings accounts and competitive rates for mortgages, including a home loan that only requires 3% down.
Membership requirement: $5 donation to the Connexus Association, which awards grants to schools and non-profits that promote education and financial literacy
Availability: Connexus lends in all U.S. states except for Alaska, Hawaii and Maryland. Home equity loans and HELOCs are also not available in Texas.
Loans: Conventional, VA, jumbo, construction, refinancing, HELOC, home equity loan
Credit score: 620 for conventional, 640 for VA, 700 for jumbo
Down payment: 3% for conventional loans, 0% for VA, 10% for jumbo, 20% for construction loan
[ Return to summary ]
Andrews Federal Credit Union
Membership requirement: Anyone can become a member by joining the American Consumer Council, a nonprofit financial education organization.
Availability: Andrews Federal lends in all 50 U.S. states and Washington, D.C.
Loans: Conventional, FHA, USDA VA, jumbo, refinance, HELOC, home equity loan
Credit score: Not disclosed
Down payment: 3% conventional, 3.5% FHA, 0% with VA and UDSA loans
[ Return to summary ]
Credit union mortgage FAQs
What is a credit union?
A credit union is a type of financial institution with many of the same offerings as a traditional bank. But it’s a not-for-profit entity owned by members, with interest and fees fed back into financial products rather than disbursed to shareholders.
Is it easier to get a mortgage with a credit union?
It can be easier to get a mortgage with a credit union. Because they’re not-for-profits, these institutions tend to work with those with less-than-perfect credit and many rely on the borrowers’ history with the union to make a decision.
Why are credit union mortgage rates so low?
Mortgage rates with credit unions tend to be lower than with other lenders because they’re nonprofit institutions, with any money generated going back into financial products for members. They also typically have lower overhead costs
Why trust CNBC Select?
At CNBC Select, our mission is to provide our readers with high-quality service journalism and comprehensive consumer advice so they can make informed decisions with their money. Every mortgage review is based on rigorous reporting by our team of expert writers and editors with extensive knowledge of mortgage products. While CNBC Select earns a commission from affiliate partners on many offers and links, we create all our content without input from our commercial team or any outside third parties, and we pride ourselves on our journalistic standards and ethics.
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Our methodology
CNBC Select analyzed dozens of credit unions to determine which are the best for home loans. We focused on the following features:
Membership eligibility: We gave more weight to credit unions with large memberships or easy requirements to join, as well as broad nationwide availability.
Credit score: Most lenders require a 620 FICO score to secure a conventional mortgage. We noted if a credit union had options for borrowers with poor credit.
Closing times: We gave more weight to lenders with shorter-than-average closing times or that guaranteed an on-time closing.
Fees: The mortgage process includes origination, application and underwriting fees, as well as charges for appraisals, title insurance, attorneys and other closing costs. When possible, we noted if a lender had lower fees, discounts or waived certain fees.
Application process: We considered whether lenders offered an online preapproval and application process and if there were physical branches for an in-person experience.Â
Customer service: We gave more weight to lenders that scored highly on J.D. Power’s mortgage origination and servicing surveys. We also noted if they had robust customer service phone hours and a website with an online chat feature and educational resources.
We also considered CNBC Select audience data when available, such as general demographics and engagement with our content and tools.
Based on that criteria, our picks for best credit unions for mortgages are:
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Editorial Note: Opinions, analyses, reviews or recommendations expressed in this article are those of the Select editorial staff’s alone, and have not been reviewed, approved or otherwise endorsed by any third party.
