Banks vs. Credit Unions failing in recession?

Question

I don't use a bank, I use a credit union and I am wondering if anyone knows if credit unions face the same dilema that banks are at the moment? I know credit unions are member owned but they are also insured by the FDIC.

I am not sure where the problems are coming from and I am not sure how it affects member owned credit unions.

Any help?

Answer 1

Actually Credit Unions are doing ok for now. The problem with most banks is that they invested heavily in sub-prime mortgage lending and because so many of those people have defaulted on their loans the banks are having to foreclose on the houses and sell them at a fraction of the initial loan amount. So they are lossing millions. Credit Unions at least from what I have heard of did not invest in sub-prime lending so they aren't taking a hit.

As long as you are under the $100,000.00 limit in one account per owner or $200,000.00 for joint account your money is covered under FDIC. If you have further questions about FDIC call your credit union. They will be able to explain it to you and give you options if you are over the $100,000.00 limit.