People join the armed services for reasons that vary and are often complex and multi-faceted. Your service can secure a better financial future as you contribute to a noble cause.
But despite best laid plans, many veterans find themselves in need of a financial leg-up. Check out our list of the best personal loans for veterans to get cash in your pocket now.
Best Personal Loans for Veterans
Returning from service can present financial hardship for many veterans. It can be difficult to go from a controlled, high-stress environment to finding your own work. Some flourish here, and some falter.
And if you were physically injured or suffer from negative mental consequences from your time in the armed services, working and staying afloat can become understandably difficult. Medical bills and debt may pile up faster than you can manage.
For these reasons, many lenders offer veteran-specific loans or loans that have characteristics that make them a perfect match for a veteran. You may also benefit from your veteran status with veteran-only perks like better rates or less rigid credit standards.
Types of Personal Loans for Veterans
A personal loan is really a 1-size-fits-all financial solution. Maybe you didn’t have the chance to build your credit during your military career and want to work on it with low-risk installment loans. BadCreditLoans.com lends small chunks of cash up to $10,000 to borrowers with imperfect credit with their personal loan.
Or maybe you just need a cash infusion to jumpstart your life as a retired serviceperson. A personal loan can help you finance a car or pay for improvements on a fixer-upper home.
There are several kinds of personal loans you can take out depending on your unique financial situation and credit history. Common differences between personal loans are secured vs. unsecured and fixed-rate vs. variable-rate loans. There’s something for almost every situation.
If you’re unsure of what type of loan is best for you, a loan comparison service like Credible can help you shop lenders without risk to your credit score. It can connect you with personal loans that can be used for anything from starting your own business post-service to career advancement.
A secured loan is backed by some type of collateral like your bank account balance or a vehicle. You may be asked to secure your loan with collateral if you’re requesting a higher loan amount.
If something on your credit report gives a lender pause when considering your request, you may also be asked to secure the loan. Adding collateral means the lender faces less risk associated with the repayment of the loan.
An unsecured loan is exactly like it sounds. Your creditworthiness is the only thing securing the loan for the lender.
Unsecured loans are typically smaller or offered to those with stellar credit. Many of us don’t outright own assets that can be used to secure a loan or keep enough money in savings to use as backing for a line of credit. Unsecured loans can make ends meet for those of us who fall into these categories.
Be careful — just because your loan isn’t secured doesn’t mean it’s a less serious obligation. Even missing 1 payment can mess up your credit score, so be sure you can meet the repayment terms before signing on.
Fixed vs Variable Rate Loans
Many lenders offer both fixed and variable rate loans. You’ll mostly want to look for fixed-rate loans. These provide a solid view of how much the loan will cost you overall. These rates may be higher or come with larger monthly payment plans.
This reduces risk to the lender and ensures the lending business is profitable. Your rate will stay the same, even if interest rates fall overall.
However, as with unsecured loans, you may be offered a variable rate loan in certain instances. While your rate may be lower initially or allow you to make lower monthly payments, it may end up costing you more than it’s worth.
Personal Loan Requirements and Criteria
Although these criteria vary by lender, most personal loans approval decisions depend on the following:
- Your FICO credit score
- Debt-to-income ratio
- Deliquicies or negative remarks on your credit report
- Credit utilization (your credit balance vs. your credit limit)
- Open accounts with a positive standing (payments being made on time and so forth)
Some veteran-specific loans (like loans offered by Navy Federal Credit Union or Omni Financial) may waive some of these requirements or offer features that make it easier for a veteran to secure a personal loan.
Personal Loan Considerations
A personal loan is your solution if you’re a veteran who needs 1 lump sum payment with quick funding you can repay over time. It’s important to understand the terms of your loan. Adhering to them during the course of repayment is important to maintain the integrity of your credit.
Look out for sketchy lenders online or at nondescript payday lenders. Some try to prey on the most vulnerable in our society, including veterans.
Try to go through trusted financial institutions. Use a loan comparison service such as Even to connect with vetted lenders and avoid trouble.
Personal Loans vs. Credit Cards
Personal loans and credit cards are both lines of credits, but the differences make them each more beneficial in certain situations.
Personal loans are best when you need 1 lump sum of cash and can meet rigid repayment terms. They allow you to pay for a large purchase or consolidate debt at lower rates.
For example, personal loans through Payoff specialize in debt consolidation and lend you enough to pay off your current credit balances. You’ll receive any remaining funds. And Payoff has transparent criteria and clear-cut terms.
Personal loans make it easy to calculate the exact amount you’ll pay in interest with a fixed-rate loan and be able to budget with monthly installment payments. When the loan is paid off, the account is closed. It’s not a revolving line of credit that you can re-use when you pay it off.
A credit card also allows you to make purchases on credit, but there are several differences. Credit cards often have lower credit limits than personal loans with variable but sometimes come with high interest rates.
Credit cards are better to cover smaller purchases that you’ll repay off in a short period of time. You usually have a minimum payment, but these don’t necessarily cover your monthly balance. This means you’ll need to manually adjust your payments to keep your balance low so your credit isn’t adversely affected.
Get Fast Funding with a Personal Loan
Whether you’ve fallen on hard times or need some extra cash to pay for a large or out of the ordinary purchase, a personal loan can be your solution.
Personal loans can be used for many things, including consolidating debt from medical bills or credit cards. Use a loan comparison service or connect with 1 of the lenders mentioned above to find a loan to fit your needs as a veteran.