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Money Matters

Ten Borrowing Tips for Military Consumers

Mar 14, 2022

When it comes to borrowing money for PCS, deployment, emergency, or other expenses, there are several things to be aware of to protect yourself, ensure your online or in-person financial transaction goes smoothly, and help manage any potential financial stress. Before applying for a loan do your research and confirm your financial partner aligns with these ten responsible borrowing tips.

1: Military Lending Compliant

Ensure the lender adheres to the Military Lending Act (MLA) and Servicemembers Civil Relief Act (SCRA), and provides the federal lending protections military consumers deserve, including no prepayment penalties, no mandatory allotments, written and oral disclosures, and the MAPR rate cap. See Understanding the Military Lending Act for more details.

2: Find a Financial Resource You Trust

Not all lenders are equal—or treat their customers equally well. Make sure the lender you choose is legitimate and has state or federal regulatory oversight, which means they will provide the security, protections, and privacy you deserve. Pioneer, for example, is affiliated with Lead Bank, member FDIC, a respected state-chartered community bank. Both companies are well established, and have a rich history of service, social responsibility, and giving back to the community.

3: No Strings Attached

You shouldn’t have to change your current banking relationship to obtain a personal loan. Be careful of providers that require you to have an existing account relationship with them to apply for a loan or have restrictions on where the proceeds of your loan are deposited. With Pioneer, all active-duty military are eligible to apply, and if approved, your loan can be directly deposited in the bank account of your choice.

4: Fast, Accessible, User-Friendly Process

Make sure your lender has a quick, hassle-free application process and online account self-service functionality that allows you to apply or manage your account 24/7/365. Their website should be easy to navigate on desktop and mobile devices and provide easy-to-understand information about all products and services.

military man applying for military loans on his mobile phone

5: Make Sure Your Security and Privacy are a Priority

In 2020 the Federal Trade Commission noted that active-duty military were 76% more likely than civilians to be a victim of financial-related ID theft. Make sure your lending partner has a secure website that utilizes the latest online financial tools/integrations that protect customer identity and personal information. The company’s privacy policy should be easily found on its website. Take the time to read it and find out how they will use, share, and protect your information before entering into any agreement.

6: Are they Military Friendly?

Not all lenders understand the unique military lifestyle, nor have established long-term relationships in the military community. Many service members still operate outside the financial mainstream, because of their mobile lifestyle, lack of credit history, age, etc. Pioneer has helped nearly 1.5 million military families over the last 30 years, assisting all members of the military regardless of rank or seniority, with a wide range of credit types, while ensuring they are afforded the respect and customer service they deserve.

7: Understand Fees and Loan Terms

Pay attention to the fine print of any loan application. Ask questions up front to ensure you understand loan fees, interest, origination fees, and any other costs you’ll pay for your loan. Structured, closed-ended traditional installment loans, with fixed rates and terms and equal installment payments allow you to know how much your payments are every month, and how long they’ll last. If there’s something you don’t understand, be sure to ask before you sign on the dotted line.

8: Don’t Borrow More than You Can Afford

Using credit wisely can be helpful and provide you with much-needed financial flexibility. But remember, a loan or the use of credit is a transactional agreement, and you don’t want to take on more than you can manage. Be smart, always budget, and plan accordingly. Stay away from companies promising “no credit check loans”.

9: Build Your Credit Profile

When you use credit wisely, you’ll build and improve your credit score—a ranking that can determine your future credit interest rates. Paying off loans, making payments on time, and not using credit excessively will put you on the right path. Make sure whatever company you partner with provides credit bureau reporting, sharing your payment history with rating agencies so you start building your personal credit immediately.

10: Look for a Guarantee

Any company confident in its product will offer some type of satisfaction no-questions-asked guarantee, especially for military who may be traveling or want extra time to review. Lending should be no different, especially when you consider the impact a poor borrowing decision can have on your finances. Learn more about Pioneer’s 15-Day Return Guarantee.

Following these simple tips when looking for a military lending partner are quick and easy and will ensure that you get the best deal while protecting your financial future.

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