Your Credit Union Deposits Are Safe!

By Julie Moore, City County Federal Credit Union Business Development Representative

It seems like it was only yesterday that home values were bringing smiles to the faces of everyone! But now declining real estate values, higher mortgage payments due to adjustable rate loans re-pricing, and the resulting increases in loan delinquencies and foreclosures have turned those smiles upside down. The sad truth is that we've all been affected by what's been termed the "Sub-Prime Mess" or the "Credit Crunch," even those who have never borrowed against the value of their property.

What's more, no financial institution has gone unscathed. But overall, credit unions have weathered this storm better than most. To the extent that credit unions have been impacted by the sub-prime debacle, it's primarily as "collateral damage" - members having trouble making payments on other loans because of a sub-prime mortgage they've gotten elsewhere, or because some members are losing their jobs in the current troubled economy.

This acute economic environment has caused some folks to be concerned about the safety of the funds they have on deposit in their credit union. However, there's no need to fear. Credit unions are member-owned and not-for-profit cooperatives existing to serve their members, not to profit from them, and just as the federal government insures bank deposits through the Federal Deposit Insurance Corporation (FDIC) your credit union deposits are also federally insured to the same levels—up to at least $250,000 per account by the National Credit Union Share Insurance Fund (NCUSIF). This is a direct result of the enactment of the Emergency Economic Stabilization Act, signed into law October 3, 2008. Higher coverage is available for members who have a combination of individual, joint, trust, payable-on-death, and other accounts.

Individual Retirement Accounts (IRAs) are insured separately with coverage of up to $250,000. Those few credit unions that have opted for private insurance (there are none in Minnesota) are required to disclose this fact to their members. If you have questions or concerns regarding the safety of your deposits, please stop by any City-County Federal Credit Union branch office to pick up a copy of "Are You Covered?" an informational brochure provided by the National Credit Union Administration. Branch locations can be found on our website at www.ccfcu.org.