Using Credit

Give Yourself Some Credit

Credit: noun \ˈkre-dit\ A contractual agreement in which a borrower receives something of value now and agrees to repay the lender at a later date.

Unless you’re independently wealthy, you’ll most likely have to use credit to buy the things you need. (Very few people can buy a home or a car with cash.)

So how do you get credit and what does “good” credit mean? (Read on little grasshopper…)


Getting Started

If you’re thinking about using credit for the first time, we recommend starting with a credit card or a car loan. We have a program for 16 to 22 year olds who are just starting their credit journey. It’s called Plugged In.

Remember these tips to keep you out of financial trouble and help you build a good credit rating:

  1. Make every payment on or before the due date.
  2. On credit cards… Try not to charge more than 30% of the credit limit and always pay more than the minimum payment required. (For the best credit rating… pay the entire balance before the end of the month.)


Credit Cards

It makes us sick when we see how some of our members are getting taken by the credit card companies they use. Check your statement… if you’re currently paying an annual fee, paying an interest rate more than 14% APR (a rip-off that’s more common than you think) or are paying late fees higher than $15, you should look at getting a different credit card. We offer MasterCard and Visa cards with rates as low as 9.9% APR. No fine print, no rip-offs.

You can transfer the balance(s) from higher interest credit cards to your Linn Area Credit Union credit card and save yourself some money. If you don’t have a credit card through LACU, check them out. You can even apply for it online!

The sooner you make a payment to the credit card company, the less you’ll pay in interest.

CREDIT CARD PAYOFF CALCULATOR – Use this calculator to see what it will take to pay off your credit card balance, and what you can change to meet your repayment goals.


Car Loans

The #1 goal of a car dealer is to get you into a sales office before you leave their lot. They’ll try to tell you that they offer attractive financing and they’ll try to get the car sold before you change your mind. That is their job, after all.

It’s best to arrange the financing with your credit union before you go to the dealership. Then you can bargain like you’re writing a check (because you are!) and you can take advantage of dealer rebates.

DEALER FINANCING VS CREDIT UNION FINANCING CALCULATOR – Use this calculator to help you determine whether you should take advantage of low interest dealer financing or credit union financing combined with a manufacturer rebate.

If you get caught up in the moment and buy a car before you’ve called us, ask the dealer if they work with Linn Area Credit Union and, if so, tell them to send the paperwork to us. We have arrangements in place with more than 60 area dealers to allow you to sign the loan paperwork right at the dealer’s office and obtain our best rates. (Subject to normal qualifications.)

We also offer GAP, mechanical breakdown insurance and credit life and disability coverage, at very attractive premiums. You can get these items at any LACU walk-in branch after the sale, if you want it.

LEASE VS BUY CALCULATORNow’s a good time to determine if buying or leasing is the better option for you.

For more great info about this, check out our Buying a Car page.

If a new car isn’t in the picture right now, you can still save money on your car loan by paying a little extra when you can.

AUTO LOAN EARLY PAYOFF CALCULATORFind out how much interest you can save by increasing your monthly auto loan payment.


Home Loans

Even a slightly lower rate might make it worth refinancing.

Many things go into determining whether refinancing will save you money. We’ll take all of these things into account when running the numbers and determining if refinancing is a good idea for you:

  • How long you plan to stay in the home
  • Your current interest rate
  • Your current mortgage loan balance
  • How many years you have remaining on your existing loan
  • How long it would take you to recoup closing costs

Hundreds of members have recently refinanced their home loans to save money. It’s definitely something worth investigating. Contact our mortgage team today or submit an application online and let us run the numbers for you.


If you have questions about using credit, just give us a call. It’s what we’re here for. :)

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