About Military Personal Loans
Loan offices servicing military personnel can be found outside many bases in the U.S. and abroad. They offer convenience and are less likely to turn down an application than an ordinary financial institution. In return, the loan company receives their payments directly from the military finance office, and any problems with payments can simply be addressed with the loan recipient's superior.
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Requirements
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Most military loan companies do not offer loans to civilians. In order to qualify for a loan, the applicant must be either Active Duty military (Army, Air Force, Navy, Marines or Coast Guard); retired with at least 20 years of service or Full Time Active Reserve. In order to apply for the loan, the applicant will need to supply her military ID card and most recent Leave and Earnings Statement (LES).
Advantages of a Military Loan
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One of the major advantages of a military personal loan is that military personnel can apply for the loan regardless of where they are currently stationed or even if they are deployed. Most military loan companies have offices worldwide as well as online applications. The funds can be electronically transferred to the servicemember's account, and an allotment is set up so that payments are automatically deducted. Allotments also help a servicemember to continue making payments while deployed or on temporary duty and prevents late fees.
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Warnings
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While most military loan companies claim to offer highly competitive interest rates, these companies will still check credit reports. An applicant with bad credit can see his interest rate skyrocket to as high as 34.95 percent APR, leading to considerably higher payments. Additionally, some companies offering personal loans to military are more predatory and will encourage applicants to stretch out their payments, taking a year to pay something back that should only take six months and resulting in the loan recipient paying more money in the long run.
Applying for a Loan
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Two of the most popular military loan companies, OMNI and Patriot, both have offices worldwide as well as convenient websites. You will need to fill out an application in which you will be asked how much you want to borrow, what you will be using the loan for and you may also be asked to list collateral. If you get the loan and change your mind, most military loan companies give you 15 days, at no additional costs.
Considerations
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A spouse of an Active Duty, deployed servicemember may apply for a military loan, but he must have a Power of Attorney in addition to the LES and his dependent ID card in order to apply. Before getting a military personal loan, applicants should investigate interest rates at their own bank to see if they qualify for a better rate, particularly since many banks also offer the convenience of online loan applications and automatic payments.
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