Navy Fed Ends a Backdoor Way To Qualify for Membership

Last December I reported on a little-known way to qualify for Navy Federal Credit Union (Navy Fed) membership. This backdoor to Navy Fed membership has been closed. The backdoor involved joining the Navy League, San Diego Council and then going through a special Navy Fed membership application process. This weekend I confirmed the closure of this backdoor with a Navy Fed membership service rep in an online chat session:

Ken: Can one join navy league of San Diego and become eligible to join NFCU?

Rep: Unfortunately, no. We had a membership change.

In December, I had speculated that this backdoor may not last. As the largest credit union in the nation, Navy Fed probably doesn’t see the need to aggressively pursue new members. There’s little to gain with promoting a backdoor to membership, and there’s a lot of potential bad publicity if the backdoor makes news.

Another Backdoor, But It Doesn’t Allow Everyone In

If you’re not yet a Navy Fed member, you may still be able to join even though you’re not in the military. In February, Navy Fed announced an expansion of its field of membership to include veterans and their families. If you have an immediate family member who has ever been in the military, you are eligible to join. Immediate family members include grandparents, parents, spouses, siblings, grandchildren, and children. Veterans and their family members can join via all channels; however, if your veteran family member is not already a Navy Federal member, you have to apply by phone or at a branch. It can’t be done online.

I have more details in this February blog post.

Once a Member, Always a Member

Navy Fed members who have already joined using this backdoor should not be concerned about losing their membership. One fundamental principle of credit unions is that “once a member, always a member”. The qualification to join doesn’t have to be maintained to continue to be a member of the credit union. You just have to maintain the minimum balance in the share savings account to keep the membership active. This principle is stated in the Federal Credit Union Act:

1759 e (2) Retention of membership.—Except as provided in section 1764 of this title, once a person becomes a member of a credit union in accordance with this subchapter, that person or organization may remain a member of that credit union until the person or organization chooses to withdraw from the membership of the credit union

It should also be noted that the Navy League backdoor used to be a legitimate method of gaining Navy Fed membership. The backdoor rules were disclosed by Navy Fed representatives. Thus, everyone who had joined by following these rules should feel that they’re legitimate members.

Thanks to the DA readers who posted in the forum and comments of these changes, and thanks to DA reader, Kaight, who posted the excerpt of the Federal Credit Union Act.

Credit Unions Anyone Can Join

Due to this change, we removed Navy Fed from the "big list" of credit unions anyone can join. You can use this "big list" to find other credit unions that have easy membership requirements.

Update 5/16/17: Edits made in the "another backdoor" section to improve accuracy and clarity.