By offering a suite of services originally designed to help military families make ends meet, Pentagon Federal Credit Union has grown into one of the country’s largest nonprofit financial institutions. Unlike credit unions that require geographic or employer-related eligibility, PenFed extends membership to any citizen with a family connection to our national defenses.
You can also become a PenFed member by paying a one-time membership fee to join the National Military Family Association or Voices for America’s Troops. Having a PenFed membership doesn’t guarantee that you’ll get approved for the PenFed Promise Visa® Card, so make sure your credit score looks great before you apply.
The PenFed Promise Visa Card is one of the best no-frills credit cards on the market. It carries no annual fee, no foreign transaction fee, no fee when you make a balance transfer, not even a fee on a cash advance. It’s a good thing PenFed is already a nonprofit organization, since they’re not making anything from this card other than finance charges from a seriously low variable APR range based on your creditworthiness.
Even that’s something you can score a deal on. PenFed has frequently offered new cardholders limited-time opportunities to transfer balances at a low, fixed rate that’s less than half the card’s prevailing variable APR. With some commercial banks charging upfront balance transfer fees as high as 5 percent on their zero-APR introductory balance transfer deals, PenFed Promise Visa Card can probably save you money if you think it’ll take longer than six months to pay off your transferred debt.
PenFed keeps its APRs and fees below the market average by exercising tougher underwriting standards than typical retail banks. Based on feedback from current and former members, you may need to provide documentation of income, even if you carry an above-average credit score. Applicants who normally have no problem getting a quick-response offer reported having to fax copies of pay stubs for credit union review. You’ll also need to agree to receive PenFed credit card statements electronically.
Should you switch to the PenFed Promise Visa?
If your score is on the bubble or if you have late payments or delinquencies on your credit report, you may want to hold back on applying for this card. Otherwise, your donation might help you qualify for a savings account without scoring you the balance-transfer deal you’re really looking for. In addition, that hard credit pull on your profile could make it harder to qualify for another issuer’s best offers.
Overall, this card offers one of the most consistently low variable APRs among all credit cards, even no-frills accounts. With no annual fee, no late fee and no penalty APR, this card makes a great addition for any family that manages bills well, but needs some occasional flexibility due to travel or illness. Credit unions like Pentagon Federal have been breaking customer satisfaction records over the past few years, and the Promise Visa could give you the perfect opportunity to make the switch.
Updated March 2, 2015 and originally published November 14, 2013. If you enjoyed this article, subscribe to the RSS feed or receive daily emails. Follow @ConsumerismComm on Twitter and visit our Facebook page for more updates.