Military Loans are funds made available to assist military members, although there are different types of military loan programs; this article discusses 10 tips and what you need to know when applying for a loan.
Purpose Of The Loan: As simple as it might sound, loans are monies that you would have to pay back with interest, and some lenders have been known to take serious liberties with their interest rates. Loans should not be your first resort; rather it should be the last. You do not need a loan to buy the latest electronic gadgets or rims for your car, you can put aside a few bucks on pay day for these; it would help you to avoid paying interest fees. And if you feel like you really need a loan, you should first look to see what is available to you on base. You might want look to sources such as military base assistance offices and other organizations that offer assistance and financial help to service members and their families. However small these loans might be, you should seek them before attempting to seek out a personal loan.
Look For A Lender: There are many lenders out there that are able to offer you a loan, however, you need to keep in mind that there bad lenders out there and you as a borrower must make sure that your loan comes from the right lender. You may begin your initial search at your credit union, majority of military bases have credit unions that are dedicated to serving the military community, and they are particularly familiar with the needs of military personnel. You can also inquire with your base assistance office, or other organizations, e.g. , the Navy-Marine Corps Relief Society. When you lend from sources recommended by service organizations, it is highly likely that they are reliable and are not greedy lenders. So take your time to find the right lender and make the best use of sources that are readily available to you; it will help simplify the whole process
Pick A Loan That Fits Your Needs: If your loans are not home or auto related then you should be able to narrow your choices among the types of personal loans available (see below). On the other hand, if your loan will be used to buy a car or house, then you need to make sure that your home and auto loans are at the proper rates, it should be better than rates you would get in a non-military lending condition. For your auto loans you should look to lenders that are specialized in such lending, Navy Federal is a good example, it serves the DoD, Army, Navy, Marines and Air force. For a mortgage loan, VA offers loans that are available to active military members and veterans and these loans are offered through different kinds of lenders and it allows service men and women to buy a house. However, the home must be used as your primary residence. You need to avoid cash advances and pay day loans by all means possible, although they make it easy for you to borrow without good credit or collateral, the rates on these cash advances are very high, and if you make a late payment the balance can grow significantly.
Investigate the Lender: In order to be offered the best loan rates, you must have the right lender, for this reason; you must investigate your lender. You need to check for three things, they are: Lender qualifications, references and finally with the better business bureau. The qualification of your lender should include being able to deal with military benefits and pay, and all other issues as relevant to military members. In checking references, your base financial office should be able to confirm whether or not your lender is known to have engaged in predatory lending. The last and most important check point is to check with the Better Business Bureau to make sure your lender does not have a bad reputation outside the military community (non-military lending), because if your lender has a bad reputation with non-military members; it is unlikely that they would change their bad tactics with you.
Know The Types Of Personal Loans Available: To pick the loan that suits your needs you need to know what kinds of loans there are, the many different military personal loans include:
The Disaster Relief Loan: Pioneer Military Lending, for instance, makes available funds of up to $1000 for military members and their families in times of disaster (simply choose the option of Red Cross Emergency beneath the application’s space).
The Bereavement Loan: This loan is for military members that have family emergencies, it is a personal loan that is interest free for 90 days.
The Career Service Loan: Is a personal loan for military service members; it makes available maximum loan amounts of $6500 for career service men and second-enlistment.
The Leadership VIP Loan: This loan offers a maximum loan amount of $5000 with competitive rates of interest to military officers.
The Premier Loan: This personal loan makes available the maximum amount of $7500; it is also at competitive rates for service members.
The Senior Leadership VIP Loan: This personal makes available the maximum of $10000 at competitive interest rates to senior service military members. All loans listed above are all personal loans, you may also look into a Military Loan, however; you must meet the required criteria.
Make Sure You Have A Lender That’s Always There: The nature of your job means that anything can happen while you are on active duty. You could get injured, killed, wounded or captured. You need a lender that is able to deal with your family in the worst of situations. You should be able to tell by a lenders track record, as to whether or not they are what they claim to be.
Pay Attention To The Interest Rates: You need to find a lender that has low, fixed interest rates. While you might have to consider other factors, your decision to choose a lender should be based on interest rates. Make sure you get all your questions answered by the loan officer. Personal loan companies also have mortgage plans; however, you must keep in mind that mortgage loans would differ according to the interest rates, the down payment or the deposit, the insurance your lender would require, the loan repayment term and all related costs.
Make Sure There Is Online Access To All Services: You would also need to consider being able to pay back your loan electronically. Generally, military members can be called to duty at any time, though away, your loan must be paid on time, you need to make sure all of the services offered to you by your lender is available online, especially, being able to make payments and get online help if necessary.
Examine All Your Choices: The Veterans Association’s active duty military loans offer many benefits. These loans may be taken out by the spouse of the active personnel without his/her presence being required. This option is particularly helpful for families of military personnel to able to secure finances while their partner is deployed. Additionally, loans made available by the VA are unsecured loans, in other words, no security is needed to procure the loan.
Check For Clauses: Before finalizing your loans, make sure you understand all of the clauses that come as part of the loan. A lot of service members frequently make the mistake of not reading through all the clauses and fine print; this makes you as a borrower vulnerable to predatory lenders. You need to study the tenure and interest rates of the loan; you also need to look out to see if there is a clause for prepaying the loan. This is particularly important because you might end up paying interest if pre-closing a loan which you were unaware had a prepayment clause attached to it. There is no need to rush the process; take your time to understand all clauses, when unsure ask the loan officer.
There are many types of loans and lenders available to military members that are in need of a loan. Though not a complicated process, you as a borrower need to find the right lender, the amount you need might play a role in the type of loan you select, and you need to make sure that your lender has good credibility. Furthermore, you need to make sure that your lender would be there when you need them. Like any other loan, interest rates are equally important, and you need to be certain that your lender has online services that you may use to manage and make payments. While seeking a lender, you need to keep in mind that the VA makes available loans to active qualified service members and most important of all; study and understand the clauses. These 10 tips will assist you in obtaining a military loan that matches your predicament.