The common-bond doctrine is a legal principle that requires members of a credit union to share a common connection, typically through their employment, occupation, or interests. This principle ensures that all members have a shared bond that justifies their membership in the credit union. The term is widely used in the credit union industry but is not explicitly defined in credit union statutes.
The common-bond doctrine is primarily used in the context of credit unions, which are member-owned financial cooperatives. This principle is crucial for establishing eligibility for membership and ensuring that the credit union serves a specific community or group. Users may encounter this doctrine when forming a credit union or when seeking membership in one. Legal templates from US Legal Forms can assist individuals in navigating the necessary documentation and procedures related to credit unions.
Here are a couple of examples of abatement:
Example 1: A group of teachers from a local school district forms a credit union to provide financial services exclusively to educators within that district. This is based on their common employment.
Example 2: A credit union is established for members of a specific professional association, such as engineers, allowing them to share resources and financial products tailored to their needs. (hypothetical example)
Examples of state differences (not exhaustive):
| State | Common-Bond Requirements |
|---|---|
| California | Allows broader definitions of common bonds, including geographic and community ties. |
| New York | Strictly requires employment or association connections for membership. |
| Texas | Permits a mix of occupational and community bonds for credit union membership. |
This is not a complete list. State laws vary, and users should consult local rules for specific guidance.
| Term | Definition | Differences |
|---|---|---|
| Common-Bond Doctrine | Requirement for credit union members to share a common connection. | Focuses specifically on credit unions and their membership criteria. |
| Field of Membership | Criteria defining who can join a credit union. | Broader term that may include various types of common bonds. |
If you're considering forming a credit union or seeking membership, first identify the common bond you share with potential members. Ensure that your group meets the criteria set forth by the common-bond doctrine. You can explore US Legal Forms for templates and resources to assist with the formation process. If your situation is complex, consulting a legal professional may be beneficial.
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It is a principle that requires credit union members to share a common employment, association, or interest.