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Military personnel, like anyone else, can find themselves in situations where they need a small loan. Military loans available in the UK are specifically designed as personal loans, often with additional features tailored for members of the armed forces.
In this article, we will be explaining what a military loan is, the different types of military loans in the UK, and how you can obtain one.
Military loans are a type of personal loan available to individuals in the military. They are well-suited to meet the needs of military personnel, as well as veterans and their families.
These services cater to members of the armed forces, providing loans that can be repaid directly from their military pay, alleviating concerns about how or when to make payments.
If you are looking to apply for a military loan, several reputable lenders are available. You could apply for a loan with First Defence Finance, or Forces Finance - both well-known for military personal loans. With First Defence Finance, the loans are also part of a credit union. A credit union is a financial cooperative which is owned and run by its members, all linked together by a ‘common bond’ or association such as where they work or live.
Applying for a military loan in the UK is straightforward and usually follows the same process as applying for a personal loan (as the base product is often the same).
Before taking any loan, a provider will need to ensure that you are eligible for the loan. For a military loan, this will often require you to either be on active duty, a veteran, or ex-military of some kind. This is to ensure that more favourable conditions are preserved for existing and past members of the armed forces.
You should also assess your own eligibility, ensuring you have the capacity to repay the loan. The benefit of a loan for military personnel is that normally the loan will be paired with your military pay, so as long as you are receiving your income, you will be able to pay back the loan in manageable amounts.
Choosing the right provider for your military loan is essential. There are many options available in the market - the three best options all being under the Joining Forces Credit Union.
The three providers under Joining Forces are:
Serve and Protect Credit Union
First Defence Finance
Forces Finance
Under these three options, applicants can be assured of their loans being protected and catered to their needs.
Military loans will require the same document verification as a personal loan, such as your income and credit history. However, these types of loans will also likely require extra verification including proof of military service.
Your military records can be obtained on Gov.uk, however, this may not always be necessary.
If you don’t meet the criteria for a military loan in the UK, then you can always apply for a Creditspring loan. A personal loan from Creditspring offers many of the same benefits as a military loan, and can be paid back in manageable instalments.
Military loans in the UK are a way of offering personal loans to individuals in the military, and there are a variety of loans available.
The main variant of what is known as a military loan is a personal loan, which is where you will borrow a fixed amount and then pay this back with a rate. As military loans are structured for those serving in the armed forces with fixed income, the interest rates are usually favourably, and unlikely to be higher than 20% APR.
Consolidation loans are another type of military loan available. A debt consolidation loan is a single loan which is comprised of multiple debts. If you are in the armed forces, or a family member of someone in the armed forces, then a consolidation loan can help you to combine multiple sources of debt into one manageable payment.
The new loan, which will be handled by the Joining Forces Credit Union, can take on your existing debts and create one single loan for you to manage. Other Military Loans There are several other types of military loans available, including:
Home Owner Loans
Holiday Loans
Home Improvement Loan
Wedding Loans
Business Lending
Each of these loans is similar, and will follow a similar application process, but will have small changes to the interest rate payments and the prerequisites to acquire the loan.
Military loans apply the same for ex-military and veterans. Loan providers will often give the same benefits to help former members of the armed forces with their finances.
Similarly, military loans are also available to family members of the military, allowing serving members to support their families.
As well as military loans, there is also additional help for housing. The Forces Help to Buy scheme is a government scheme designed to help members of the armed forces onto the property ladder.
Military loans carry many benefits that are intended to help serving personnel with their finances. As people in the military receive a stable rate of income, it is also much easier for lenders to ensure collateral.
Some large organisations will even offer tailored loan policies on their own products. For example, Barclays has a tailored loan policy meaning that you can apply for a loan without an address – you can simply use your British Forces Post Office address.
Here are some of the main benefits of obtaining a military loan:
Lower interest rates
Military loans are personal loans but often with competitive interest rates, making them much more affordable than some other personal loans, or even payday loans, which often have very unsustainable interest rates.
Tailored for the military
Military loan providers will be suited specifically for members of the military, so you can be assured that your payment plan will fit with your income and lifestyle. Military loans work with a payroll deduction, so you can be sure that as long as you’re still serving, you will have the funds to pay back your loan.
Credit leniency
Military loan lenders are typically more lenient regarding credit history, as they may be part of a credit union, and also understand the specific financial challenges that come from military life. Furthermore, if you are a serving member of the armed forces, the lenders will take a deduction from your payroll, so they can be much more assured of the collateral.
Yes, veterans with bad credit can get a loan, however it may be more challenging. Lenders will consider your credit score and income, if both are low, you may face rejection.
Obtaining a secured loan, or improving your credit score with a loan for bad credit could be one way to increase your likelihood of obtaining a loan as a veteran.
Military loans are fundamentally the same as personal loans, but the way they are obtained is different. A military loan will go through a military credit union company, such as the Joining Forces Credit Union, and as a serving or former member of the armed forces, you will receive more favourable rates and features.
Yes, most military loans, like any form of loan, are normally applied for online. However, you can also speak to service personnel within the army who can advise you on personal finance.
In conclusion, military loans are a tailored form of personal loan for members of the armed forces, family members and veterans.
In the UK, three of the leading military loan providers have unified under the Joining Forces credit union, which operates on a payroll deduction scheme, to offer more competitive rates. Under the guidance of the Ministry of Defence, lenders under these schemes are designed to help you save and borrow sustainably alongside or after your military career.
