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Thrift Association


A Thrift Association, also known as a savings and loan association, is a financial institution that specializes in accepting savings deposits and making mortgage and other loans. They aim to provide home loans at low interest rates to their members. They are cooperatively-owned, meaning they’re owned by the depositors who share in profits.


The phonetics of the keyword “Thrift Association” is /θrift əˌsōsēˈāSH(ə)n/.

Key Takeaways

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  1. Thrift Associations primarily operate to promote personal savings and home ownership. They offer a variety of services including mortgages, loans, and savings accounts.
  2. They function similarly to banks but are considered cooperative financial institutions as they are owned and operated by their members.
  3. They are aligned with members’ needs as any profits made are given back to the members in the form of reduced costs and increased savings interest rates.



Thrift Associations, also known as savings and loans associations, are vital entities in the business/finance realm, primarily because they function as one of the key pillars of the financial and banking industry. These associations mainly encourage both savings and homeownership among consumers by accepting savings deposits and offering mortgages and other types of loans. Thrift associations play a significant part in supporting people in purchasing homes, thereby contributing to the growth of the real estate market and the broader economy. They also provide a platform for individuals to save and grow their wealth. Thus, Thrift Associations substantially help in fostering personal finance and the community’s financial stability.


Thrift associations, also commonly known as savings and loan associations (S&L), serve a critical purpose in the realm of finance and business. Their primary function is to promote savings and homeownership for individuals and businesses alike. They work by encouraging their members to save money, which the association then pools together to provide mortgage loans to those wishing to purchase property. This largely community-oriented approach allows individuals to invest in their local economies and provides a means of home ownership for those who may not qualify for traditional bank lending.Moreover, through the provision of residential mortgages, thrift associations contribute significantly to facilitating real estate investments, which in turn drive economic growth and stability. Borrowers can utilize the loans to buy, improve, or even construct residential properties. The payment terms and interest rates of such lending are generally more accommodating, making it an attractive option for many individuals. By stimulating local property markets, these associations play a crucial role in overall economic dynamism and contribute to community development and prosperity.


1. Navy Federal Credit Union: Navy Federal is considered a thrift association and it is one of the largest saving and loan associations globally. While initially serving only Navy personnel, it has significantly expanded its membership to include all forces in the Department of Defense. It provides a wide collection of financial services like credit cards, loans, saving accounts, checking accounts, and certificates.2. TIAA Bank: This is another example of a thrift association. Formerly known as EverBank, TIAA Bank offers a full range of banking and lending services to its customers, focusing largely on retail savings customers and home mortgages.3. Third Federal Savings and Loan: Founded in 1938, this Cleveland-based company is a large thrift association that offers deposit and lending services in several U.S. states, offering competitive rates on mortgages, home equity loans, and savings accounts.

Frequently Asked Questions(FAQ)

What is a Thrift Association?

A Thrift Association, also known as a savings and loan association, is a financial institution that specializes in accepting savings deposits and making mortgage and other loans to its members.

What is the main objective of a Thrift Association?

The main purpose of a Thrift Association is to channel the savings of individuals into mortgage loans for homebuyers.

Are Thrift Associations a type of bank?

Yes, they are somewhat similar to banks. However, by law they are obliged to have at least 65% of their lending in residential mortgages, so they primarily focus on home loans.

Can anyone become a member of a Thrift Association?

Membership eligibility for Thrift Associations vary, however, typically these institutions require that you live, work or attend school within a certain radius from the local branch to become a member.

How safe is my money in a Thrift Association?

Funds deposited in a Thrift Association are insured up to a certain amount by the Federal Deposit Insurance Corporation (FDIC), providing a similar level of protection as funds deposited in traditional banks.

How can I benefit from being a member of a Thrift Association?

Members of Thrift Associations can benefit by receiving better interest rates and less fees compared to many banks. Because they are community-based and focus on helping their members, the overall borrowing costs can be lower.

How does a Thrift Association contribute to the economy?

By providing loans to homebuyers, Thrift Associations stimulate the housing market and contribute to overall economic growth. In addition, they often keep money localized, which can stimulate community development.

Where can I find a Thrift Association near me?

You can search online or check the Yellow Pages for the nearest Thrift Associations in your area. Make sure to read reviews and do comprehensive research before choosing.

What are the drawbacks of a Thrift Association?

The main drawback to a Thrift Association is that they have fewer branches and ATMs compared to larger banks. This can sometimes make access to funds slightly less convenient.

Related Finance Terms

  • Savings and Loan Association
  • Mutual Savings Banks
  • Accrual Accounting
  • Mortgage Lending
  • Financial Intermediaries

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