Regardless of the career that a person might be in, the challenge of finding lenders willing to grant loans to them when bad credit is a factor in the application can cause some real frustration. A poor credit history hints that the borrower cannot be trusted to make repayments without a hitch. But other factors can ease lender worries, which is why military loans for bad credit borrowers are less troublesome to secure.
Of course, it is important to understand that even members of the military are required to meet specific criteria. But fast loan approval is more likely because of two key reasons: firstly, the degree of job security; and secondly, income reliability.
However, there is also a third reason why the chances of approval might be improved, namely the purpose of the loan. Just like any other, military loans can be used for a variety of purposes, from paying college fees to financing a family vacation to Hawaii. But the purpose that lenders everywhere like to see is debt consolidation.
Why Military Personnel Get the Breaks
It might seem a little unfair but military personnel are entitled to some of the biggest loan breaks around. It all comes down to the sense of security that lenders feel when granting them loans. For a start, the chances of a member of the military losing their job is practically nil. So, military loans for bad credit borrowers is always likely to be repaid.
The second reason is that the income is never likely to be cut or held back, something that can sometimes occur when companies are trying to cut costs and avoid closure. The US government is safe to bank on, and with the certainty of a good salary every month, lenders are willing to grant fast loan approval.
Overall, a military loan is easier to get than a personal loan by a civilian because of the certainties involved. And when the purpose of the loan is to deal with outstanding debts, and getting finances in order, then lenders are even happier to give the green light.
Being in the military provides some other advantages too. Because the certainty of employment and income reliability are both high, the interest rates charged with the loan are always lower than those charged by regular banks. But the interest on military loans for bad credit are lowered even further when the borrower is on active duty.
This is in line with the terms of the Soldier’s and Sailor’s Relief Act, which states that service members who have availed of personal loans for clearing bad debt, before being called to active duty, should be charged lower interest rates. In some cases, the interest rate reduction can be as much as 6%. This stands for loans sourced from both certified military lenders, and private lenders too.
So, access to fast loan approval is only one advantage, with the chances to lower the amount of debt repayments each month significantly. And with the benefits that come with active duty, military loans seem to be the best possible loan option.
Knowing Your Entitlements
Military personnel are not always told everything they are entitled to straight away, so it is important that before applying for a military loan for bad credit, some matters are checked out.
The Internet provides the best source of information, with numerous message boards offering advice and first-hand accounts. But there is also great access to online lenders who specialize in lending to military applicants.
Besides the promise of fast loan approval, there is also often a list of facts provided in their FAQ page. However, for anything to do with military loans, it is also a good idea to consult your local financial advisor.