USAA Personal Loan Review: High Borrowing Limits with Decent Rates

USAA Personal Loan Review: High Borrowing Limits with Decent Rates

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USAA personal loans are best for those who meet the membership requirements, have excellent credit and want to borrow a large sum of cash quickly. However, these loans aren’t a good option for those who don’t have a connection to the U.S. military or for those who have bad credit.

USAA personal loans review

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Before diving into the application process, it’s important to note that personal loans can't be used to pay for higher education. And in order to qualify for this loan, you’ll have to be a USAA member (more on that below).

USAA personal loans are a good option for:

  • Existing USAA members, as nonmembers do not qualify
  • Those who need to borrow from $2,500 to $50,000 and are willing to sign up for auto-pay for a lower rate
  • Borrowers who want to refinance or consolidate debt, pay for a major purchase or handle an unplanned expense

USAA personal loans are not good for:

  • Nonmembers
  • Borrowers with bad credit
  • Those who need a small loan or a longer loan repayment term

These loans come with a high upper borrowing limit and have an autopay discount as well as repayment terms of up to seven years. But when you look at the current rates, they aren’t as competitive as you might find elsewhere — though they can be lower than you might find with something like a credit card. The terms you’d get would depend on your credit, as well as other factors.

Unfortunately, USAA does not publicly go into great detail about their personal loans fees and requirements. Those who are interested should contact USAA to find out more.

Can you afford a personal loan?

When looking for a personal loan, in addition to considering the rate, it’s important to consider whether or not you could afford the monthly payments. For example, a $5,000 loan with a six-year term and 13.15% fixed APR from USAA would have a $100.75 monthly payment.

To get an idea of what repayment might look like for you, check out the USAA personal loan calculator. It’s also a good idea to shop around to see if you can qualify for better rates elsewhere. In that case, make sure you use prequalification — that way you’ll get an idea of the kind of loans you qualify for without getting dinged on your credit.

Member eligibility criteria

To qualify for a USAA personal loan, you first have to be a USAA member. That means you’re:

  • Actively serving in the U.S. military (Air Force, Army, Coast Guard, Marines or Navy)
  • Former military (retired or parted ways with an honorable discharge)
  • A family member of someone who is a USAA member
  • A cadet or midshipman at a U.S. service academy, in advanced ROTC, or on ROTC scholarship, or an officer candidate within 24 months of commissioning

When applying for membership, you’ll have to provide proof of the following information:

  • U.S. citizenship (*or, for non-citizens, a passport or permanent resident card will also work)
  • Date of birth
  • Contact information
  • Social security number
  • Details about your family member's military service

USAA personal loan terms and requirements

Qualified USAA members can borrow up to $50,000 with a personal loan, with repayment terms up to seven years. The lowest rates, and longest terms, are limited to those with excellent credit. And, in general, your rate will depend on approved credit as well as other factors (though USAA doesn’t go into detail about those factors on its site.)

Loan Amount Range$2,500 - $50,000
APR Range0.0949 (includes 0.25% auto-pay discount)
  • Application fee: None
  • Origination fee: Not specified
  • Late fee: Not specified
  • Prepayment penalty: None
  • Check processing fee: Not specified
  • NSF/returned payment fee: Not specified
Loan Terms1 to 7 years
Repayment OptionsMonthly
DiscountsAuto-pay discount: 0.25%
  • To qualify for the seven-year loan term, you have to borrow at least $20,000. Rates and terms accurate as of July 6, 2019.

Application process

To apply for a loan, USAA members need only fill out an online application, which the lender says should take a few minutes to complete. In general, you’ll find out your rate upon approval, and receive funds in a USAA bank account as fast as the day following that decision (depending on the day of the week that your application is approved.)

Application ProcessOnline
Time to Get FundsWithin 24 hours, Monday through Friday
Credit Check
  • Hard credit check when you apply
Credit ReportingYes
Cosigners/Co-borrowers Allowed?Not specified

When applying for a personal loan, you will likely be asked to provide:

  • Personal information, such as your name, Social Security number and phone number
  • Proof of identity and address
  • Financial information like your credit score, employment status and income
  • Education information
  • How much you need to borrow and why

You should also expect the lender to ask for documents verifying your identity, employer and more.

How does USAA compare to other lenders?

USAA loans have a lot in common with those from Navy Federal Credit Union (NFCU), since both are targeted at members of the military and their families, and come with similar rates — but NFCU personal loans have longer terms available to borrowers, making them a better long-term option.

Discover personal loans, on the other hand, are widely available and can have lower rates than you might find with USAA, but only for those with excellent credit. Otherwise, their rates can be quite high by comparison. So you’ll have to weigh the options carefully and consider your unique circumstances to select the best loan for you.

If you’re looking for a personal loan, it’s always a good idea to look at several lenders in order to snag the best rates and terms. And keep in mind that if you’re denied a USAA personal loan, like if you have bad credit and can’t qualify, there may still be other options out there. But again, always opt for prequalification — that way you can test the waters without doing damage to your score.

USAA vs. Navy Federal Credit Union

The NFCU personal loan is best for NFCU members who have average or fair credit. NFCU casts a wider net when it comes to its membership eligibility requirements, so it’s a bit more accessible than USAA. In addition to welcoming active service members and their families, it’s also open to Department of Defense (DoD) civilians, contractors assigned to DoD installations and Delayed Entry Program personnel.

Compared to USAA loans, NFCU’s unsecured personal loans come with a similar, although slightly higher, rate-cap. But NFCU does offer longer terms (up to 15 years), and it provides more transparency around their fees and requirements than USAA does. That doesn’t necessarily mean it has better terms than USAA, but it can be an indicator of its customer service as well as its willingness to help members understand their options.

NFCU also offers secured personal loans, meaning borrowers would have to put up collateral in order to qualify. So those who prefer that option (in exchange for lower rates) would be better served taking out a secured loan through the NFCU.

USAA vs. Discover

Discover personal loans are good for those with excellent credit who want a personal loan with a lot of flexibility. For example, it comes with a 30-day money-back guarantee, multiple payment options, and it lets you set the due date.

Compared to USAA, Discover is much more widely accessible as it does not require membership to borrow. But with that wider availability comes a wider APR range: Discover personal loans can be quite a bit lower than USAA’s loans (if you have excellent credit), but they can also be significantly higher (for those with bad credit).

Another potential drawback is that Discover limits borrowers to $35,000 loans whereas USAA cuts off at $50,000. And, for those looking for a shorter-term loan, Discover requires a term of at least three years (compared to USAA’s one year) for repayment, so that’s something to consider. Though it’s worth pointing out that there is no prepayment penalty fee, as is the case for USAA loans.

Ultimately, those who don’t qualify for USAA membership, have great credit and want flexibility in their loan could be better off choosing Discover as their lender.

Devon is a San Francisco-based freelance writer covering all things personal finance. Her work has been featured in publications such as the L.A. Times, Marketwatch, CNBC and USA Today, among others.

Editorial Note: The content of this article is based on the author’s opinions and recommendations alone. It has not been previewed, commissioned or otherwise endorsed by any of our network partners.