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Loan Options for Military Families

Loan Options for Military Families

One of the good things about being a military family is the availability of loans specifically designated for people serving or who have served in the military and their spouses. These loans often have less strict regulations such as no down payments or lower interest rates. Learn more about the personal financing options available to you before you start looking for your next loan.

VA Loans

VA loans are home loans specifically for veterans and those currently serving in the military. The loans are administered by The United States Department of Veteran Affairs and are considered by many to be one of the most powerful benefits available to military families. Under the program, the VA itself doesn’t actually grant loans to homebuyers. Instead, it guarantees VA home loans taken out by those currently serving and veterans. Because of this VA loans come with a few added perks including:

  • The option to purchase a house with no down payment
  • No private mortgage requirement
  • Easier qualifications for servicemembers and veterans
  • Better interest rates than normal home loans

There are several eligibility requirements that need to be met in order for someone to qualify for a VA loan, including income, credit, and minimum service requirements. Additionally, VA loans can only be used to purchase a primary residence, refinance the mortgage on a primary residence, or to purchase a nonprofit shelter used to house disabled and homeless veterans.

Peer-to-Peer Financing

If your credit isn’t quite good enough to qualify for a non-secured personal loan from a bank, you should consider peer-to-peer financing. The great thing about peer-to-peer financing is that it does allow military families with less-than-stellar credit to obtain money they need to consolidate bills, buy a house, buy a car, and even start a business. However, peer-to-peer funding isn’t for everyone. They aren’t bad credit loans. Typically, to get an unsecured personal loan from a bank, you need to have a credit score in the high 600s. Peer-to-peer funding options allow people with lower credit scores to obtain loans, but most options still require the borrower to have at least a credit score of at least 600.

Military Spouse and Dependent Loans

Military spouses and dependents can also qualify for personal loans, which are simply called Military Spouse and Dependent Loans. These can be used to pay off credit card debt or high-interest loans or to consolidate large amounts of debt. The good thing about these types of loans is that there aren't restrictions on the way you use the money. This means it can be used in emergency situations as well such as unexpected car repairs or to keep your family afloat if you have to take time off work due to an injury or illness.

Credit Cards for Military Spouses

In addition to home, car, and personal loans, military spouses can qualify for specific credit cards, which are designed just for military families. These military spouse credit cards can be used to finance everyday purchases such as gasoline, food, household needs, and clothing. These cards typically have lower interest rates than other credit cards, making it easier for families to pay off what they charge.

If you're an active member of the military or a veteran, it's important to know what type of financial help is available to you. This way, if you need a loan or credit card for any reason, you can apply for one with extra benefits for military servicemembers and/or their spouses and dependents.

Peer to Peer Lending and Private Lending Info