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Although military families have special financial resources available to them, many are still struggling to make ends meet. Personal loans may help veteran borrowers fill gaps to cover unexpected expenses, make large one-time purchases and consolidate other debt.
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Personal Loan Lenders That Serve Veterans
Three main organizations cater specifically to veterans' financial needs: Pentagon Federal Credit Union, Navy Federal Credit Union and USAA. Each lender offers personal loans meant for people with average to fair credit, with interest rates capped at 18% and low credit score requirements. In order to take advantage of these loans, you'll typically need to become a member of the credit union.
Pentagon Federal Credit Union (PenFed)
Pentagon Federal Credit Union (PenFed) is best for veterans with fair to average credit scores, which is around mid-600s or higher. The lender offers personal loans up to $50,000 with rates ranging from 17.99% to 5.49%. You can even use a co-signer to improve your chances of approval and to get a lower rate. To get a loan with PenFed, you will need to be a member of the credit union.
Drawbacks: PenFed is not a great lender for borrowers who need a big loan, as it only lends up to $50,000 and may take up to seven days to release funds. If you have good to excellent credit, you should always check to see if you can qualify for a lower interest rate elsewhere.
Navy Federal Credit Union
Navy Federal Credit Union is another lender that caters to veterans, military members and their families. Rates range from 8.19% to 18% with loan amounts up to $50,000 , depending on your loan term. Aim for a credit score at or above 650 to increase your chances of approval. Similar to PenFed, you can use a co-signer to help you qualify for a lower personal loan rate, and you will need to become a member with Navy Federal Credit Union.
Drawbacks: If you have excellent credit, you should shop around, as you will likely qualify for a rate below 8.19%. Navy Federal is also not a great lender if you need fast funding, as it takes three or more days to receive funds. If you have the time, compare your options before settling on this lender.
USAA personal loans are open to veterans, active military, spouses of USAA former or current members, children of USAA former or current members, and former USAA members. Rates with this lender start at 7.24%, which is higher than the other credit unions on our list offer. However, borrowers typically receive funding by the next day, which can benefit those who need money fast and want to work with a credit union.
Drawbacks: Rates from USAA start higher than our other recommended lenders that cater to veterans, so if you have good credit, look at your options before choosing this lender. Co-signers are not allowed on loans, but you can apply with a co-borrower, in which you both have access to the funds and are both responsible for paying off the loan.
Personal Loans for Veterans With Bad Credit
If you've decided to explore personal loan options but you have a poor credit score, multiple online lenders will still consider your application. We evaluated dozens of personal loan companies to help you find and compare lenders that provide personal loans for veterans with bad credit. Keep in mind that these lenders don't specifically cater to veterans, they are available to anyone who meets their requirements.
OneMain Financial is one of our top personal loan choices for borrowers with bad credit, as the company doesn't impose credit score and gross income requirements for personal loan applicants. The lender's interest rates range from 18% to 35.99%, which is high for borrowers with good credit scores but reasonable for those who won't qualify with other lenders. After approval, personal loans are typically funded within the same day.
Drawbacks: Other than the high starting interest rates, the main drawback to getting a loan with OneMain Financial is that you will likely have to visit a branch to verify your information and complete the loan process. There are more than 1,600 branches in 44 states, but the lender is not available in Alaska, Arkansas, Connecticut, D.C., Massachusetts, Rhode Island and Vermont.
Avant is also a good option for those with low credit scores, as it has few requirements and offers repayment flexibility. Unlike OneMain Financial, Avant does impose a minimum credit score of 580, which is still lower than most lenders' requirements. Avant offers personal loan amounts up to $35,000 with APRs ranging from 9.95% to 35.99%. You can manage your payments online or through its mobile app, which allows you to change your payment date up to one day before the payment is due.
Drawbacks: It's important to note that Avant is not available to borrowers in Iowa, Colorado and West Virginia. Also, these personal loans cannot be used to fund your business, which gives you less choice in how you use your loan. In comparison, other lenders don't restrict how you use your loan.
Peerform is a good choice for borrowers with a good payment history in the past year. It offers competitive rates from 5.99% to 29.99%, but the company is different because it's a marketplace lender. Instead of the company funding your loan, it is financed by investors on the site. You'll need a credit score of at least 600, a debt-to-income ratio below 40%, an open bank account and at least one revolving account on your credit history to qualify. Also, make sure you don't have any current delinquencies or recent bankruptcies before applying.
Drawbacks: Since the loans are funded by investors, the funding time can take up to two weeks, meaning it is not the best choice if you need a loan quickly. Also, personal loans from this lender are not available to residents of Connecticut, North Dakota, Vermont, West Virginia and Wyoming.
Personal Loan for Veterans With Good Credit
Borrowers with good credit will have more options because they can qualify for lower rates and better terms. Online lenders generally offer the lowest rates, but you can still check out your options from banks and credit unions. With a good credit score, you should take the time to weigh your options and get the lowest rate possible. Similar to the bad credit lenders, these companies don't specifically cater to veterans and are available to anyone that meets their requirements.
LightStream is one of the best personal loan options for borrowers with excellent credit because of its low rates and range of loan amounts and terms. The lender also has fast funding times, with some loans funded within the same day. Rates range by loan purpose, and LightStream also offers a Rate Beat Program, where the company will beat any interest rate from another lender by 0.10 percentage points as long as you fit their terms and conditions.
Drawbacks: LightStream's personal loans don't have many drawbacks, but the lender isn't the perfect fit for everyone. The loan company generally requires a credit score of at least 680, and personal loans from LightStream cannot be used for educational or business purposes.
SoFi is another great personal loan company for borrowers with strong credit histories. A huge benefit to using this lender is that it offers networking and social events for its members as well as career assistance and unemployment protection. If you lose your job, SoFi will help you find a new one and allows you to pause payments for three months at a time for up to 12 months. You can borrow up to $100,000 with interest rates from 6.99% to 22.28% and terms of three, five or 7 years.
Drawbacks: SoFi doesn't allow co-signers on their personal loans, so you will have to qualify on your own. However, the lender does allow co-applicants if both live at the same address. SoFi personal loans are not available for residents of Mississippi.
If you’re looking to invest in your professional development, relocate or make home improvements, Earnest offers competitive unsecured personal loans. Rates range from 5.99% to 17.24% with loan terms of one to three years, and the lender charges no fees except for a returned payment fee of $8. Although the lender doesn't have a minimum credit score requirement, it does look for financially responsible borrowers with good to excellent credit history.
Drawbacks: In order to check your rate for a personal loan with Earnest, the lender will have to perform a hard pull on your credit history, which can temporarily lower your credit score. So, you should only apply if you're sure you'll be approved and you don't need the credit score you currently have in the near future. On top of this, Earnest is not available in Alabama, Delaware, Kentucky, Mississippi, Nevada or Rhode Island.
Financial Resources for Veterans
Veterans should check out their other financial resources before taking out a personal loan, as many organizations offer grants, programs and job services. If you qualify for free assistance, use those services before taking out money you'll have to pay back later with interest.
Grants and Programs
Veterans looking for grants have options for housing, disability, education and other assistance. Grants can range from hundreds to thousands of dollars and generally require you to submit an application. Here are some grants and programs to look into, depending on your needs.
- Unmet Needs Program: The Veterans of Foreign Wars provides this program for veterans, service members and military families with financial difficulties resulting from deployment or other military-related activities or injuries. Grants are issued up to $1,500 and can be used for basic life needs.
- Rebuild Hope: This nonprofit organization helps families of disabled veterans from the Iraq and Afghanistan wars rebuild their lives through emergency financial assistance grants.
- Troops to Teachers: The U.S. Department of Defense offers this program to help veterans who want to pursue a degree in education.
- Modest Needs Homecoming Heroes Grant: Through this grant, veterans who have recently returned from overseas deployment can receive help with emergency expenses.
- Adaptation Grants: The Veterans Benefits Administration offers these grants to help service members and veterans with permanent and total service-connected disabilities purchase, construct or modify a home to accommodate a disability.
To help veterans transition into careers after service, there are multiple job resources to check out. You can go to the U.S. Department of Veterans Affairs website for programs and counseling. Multiple job boards list jobs geared toward veterans. Some companies, like AT&T, have their own veteran employment programs. Below, we've listed some of the organizations that offer these services.
- Blue Star Families: This organization offers free resources and job assistance, which includes training, networking, mentoring and job placement.
- Hiring Our Heroes: The U.S. Chamber of Commerce launched this initiative in 2011 to assist veterans in finding meaningful employment opportunities through job fairs, fellowships, mentors and free resources.
- RecruitMilitary: This organization offers a list of jobs for military members and veterans to look into. You can post your resume for companies to find you, and RecruitMilitary organizes career fairs nationwide.
- USAJobs: This is the government's official employment website for federal jobs, including jobs for veterans.
- VetJobs: This website lets you search for jobs, upload your resume and connect with potential employers.
How We Arrived at Our Top Personal Loan Picks for Veterans
We evaluated dozens of personal loan providers to find the best loans for different types of borrowers. Overall, the lenders that we included in our list scored well in each of the criteria below. We considered the following criteria in our review:
ValuePenguin's Selection Criteria
Competitive APRs: In most states, the maximum APR allowed on a personal loan is 36%, which is considered the highest APR a lender can charge that a borrower can still reasonably afford. We made sure that lenders on this list fell in that range, with most offering maximum interest rates lower than 36%.
Lender credibility: We looked at each lender’s credibility and reputation based on user and third-party reviews, Better Business Bureau (BBB) ratings and the company itself.
Transparent rate and fee disclosure: A trustworthy lender will present interest rates and fees upfront to make it easy for the borrower to understand the cost of the loan before accepting.
Range of loan amounts and terms: We looked for lenders that offered a wide range of loan amounts (typically up to $25,000 or more) and a variety of repayment terms.
Fair Fees: We chose lenders with reasonable origination fees, late fees and no prepayment penalty. Sometimes lenders will give you a quote for a loan but when the fees are added in, the loan costs a lot more than the initial quote.
Geographic reach: We looked for lenders that were available in multiple states, with most lenders in the list being available in at least 35 to 40 states across the U.S.