Rates are current as of October 2016, but are subject to change. Check with each bank, specifically, for their most recent rates.
By Andre Wong and Megan Wells, Police1 Contributors
When we think of auto financing, it’s common to let the dealership find the best rate. But as a police officer, you are entitled to special rates at many financial institutions. Some of the best rates can be found at credit unions.
Credit unions and banks share many of the same functions. Both can make loans, issue checks and credit cards, and offer investment services. The difference? Since credit unions are owned by their members, they can offer lower fees and interest rates.
We measured current starting interest rates at a big bank, Wells Fargo, and compared starting interest rates for nearly 100 credit unions across the country to find the best deals. If you’re on the market for a new or used auto, check these rates out before applying for financing at the dealership.
For reference, here are current starting rates for Wells Fargo:
| New purchase (from dealer) | 3.14 percent |
| Used purchase (from dealer) | 3.60 percent |
| Used purchase (private party) | 6.38 percent |
Why choose a police credit union over a bank?
Since banks are for-profit companies, they are obligated to make money for their shareholders by collecting fees, charging interest on loans, and reinvesting their account holders’ money.
Credit unions are not-for-profit organizations that not everyone can join. Their members, in this case police officers, band together to provide lower interest rates and fees. Because they have lower overhead costs than large banks and also don’t have to pay corporate income taxes, credit unions are able to pass on the savings to their members. Any profit they make is either redistributed to their account holders or reinvested back into the organization.
In general, credit unions act in the interest of their members and focus on affordability. Credit unions may eliminate some services you’d expect from a bank to reduce the amount of required fees. Police credit unions also offer lower interest rates on loans and credit cards than national banks.
The police credit unions below all list lower starting at interest rates for autos than Wells Fargo, depending on your credit score and lease terms. If there’s one near you and you’re comfortable with their terms, switching to a police credit union could cut your auto interest rates by a substantial amount.
Are we missing a credit union? If you’re a member of a local police credit union, please let us know in the comments below so we can add your organization to the list.