Even with bad credit, veterans can qualify for debt consolidation loans
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Are you a veteran who is struggling with debts? Consolidating debts can lower interest rates and simplify payments. There are still options for veterans with bad credit. Here we’ll provide some options for debt consolidation loans for veterans with bad credit.
VA Backed Loan Options
Unfortunately, the VA doesn’t offer debt consolidation loans. Refinancing a mortgage is an option. You can use the money you save to pay down other debts. Home equity reserves can be used to consolidate debts if you have a VA loan.
Home equity reserves grow over time as the home’s value increases and with each mortgage payment. You must meet certain requirements to be eligible, however.Military Credit Unions and BanksFinancial institutions like Navy Federal Credit Union and USAA provide loan options tailored to veterans, often with more flexible credit requirements. According to their website, Navy Federal Credit Union provides debt consolidation loans ranging from $250 up to $50,000 with terms starting at 8,99% APR. According to USAA, it offers personal loan rates as low as
10.04
% APR. No application fees or penalties for early repayment are charged. The loans range from $1,000 up to $100,000. Look into Assistance ProgramsOrganizations like Operation Homefront and the Veterans of Foreign Wars (VFW) offer financial assistance, grants, and loan resources to help veterans consolidate and manage debt. Operation Homefront, for example, has a Critical Financial Assistance Program which addresses financial crises such as mortgage payments, rent, utilities and car repairs. It also covers overdue bills and critical baby items. Financial assistance is in the form of a grant, not a loan, and paid directly to service providers.
Get a Secured Loan
If none of these options work for you, consider applying for a secured loan. Secured loans are when you put up collateral, such as your car or home, to be approved or get a lower rate. Consider adding a cosigner to increase your chances of getting a loan. It may be necessary to reduce your debt-to income ratio first by consolidating smaller debts. Withdraw money from your Thrift Savings Plan
Another way to pay down your debts is to withdraw money from your Thrift Savings Plan. If you are under 59 1/2, there will be penalties and tax implications for an early withdrawal. Before you withdraw money, consider your retirement situation. Research all of your options and pick the one that is best for your situation. Do you have any other questions about debt consolidation and veterans? Please let us know what you think in the comments. Never Quit. Adversity is a gift, not a curse
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