Military Loans for Those With Bad Credit: Key Benefits that Ensure They Work

Finding lenders willing to grant loans to applicants with poor credit ratings can be something of challenge. It is the same for members of the military, who can fall into a poor financial position as easily as the rest of us. But through military loans for those with bad credit, they can escape the quagmire.This is not to say that members of the military do not have to meet specific criteria. In fact, in keeping with general understanding, getting loan approval is dependent on ticking all of the necessary boxes. What is different, however, is the degree to which job security and income are considered safe.These two factors are key influences when applying for a military loan, as they are for any other loan. But there are additional benefits, with rock bottom interest rates to pay if the borrower is called into active duty.Key Loan BenefitsMilitary personnel provide lenders with real security in two key areas. Firstly, there is practically no chance of military personnel being made redundant suddenly, as can happen to civilians. What this means is that the ability to repay loans, especially military loans for those with bad credit is constant.Secondly, with job security so high, the chances of a monthly paycheck being affected are also nil. The US government is the employer, and there is no chance of payments being delayed or cutbacks meaning incentives suddenly being withdrawn. This effectively means getting loan approval only rests on the debt-to-income ratio.Even with military loans, lenders will use the debt-to-income ratio, which measures the affordability of loan repayments. What is means is that if the existing debts are more than 40% of available income, then the lender will deny the application.Other Benefits to Military BorrowersBut the issue of affordability is greatly helped by the status of the borrower. The job and income security is only part of it, with the fact that such certainties mean the lender will charge lower interest rates than usual. This is makes the ideal loan a military loans for those with bad credit.And there are more benefits available too. For example, when the borrower is sent on active duty, there are further discounts available, like reduced interest rates. This is awarded as part of the terms of the Soldier's and Sailor's Relief Act, which reduces the interest on personal loans that have been taken out to clear bad debt. The reduction can be as high as 6%, so even when getting loan approval at a rate of 10%, by going on active duty, the rate can be cut to just 4%.The effect of both of these factors is to ensure the monthly repayments are kept to a very affordable level. So, military loans are the ideal option for those seeking to recover from a difficult financial situation.Where to Get a LoanThe key to making the most of military loans for those with bad credit is to get the best terms in the first place. The Internet is an excellent resource in this regards, allowing access to a variety of online lenders who specialize in lending to military personnel.But while the online option is worthwhile, it is also a good idea to contact military credit unions. It is the surest way of getting loan approval and being provided with the maximum benefits.Of course, military loans are available to all members of the military, and the best source of information is the credit union of your particular branch of the armed forces - Navy, Air Force, Marine and Army. Then through these loans, the borrower can improve their credit rating and financial situation with the very best terms.