US Military Loans: 3 Federal Agencies
US military loans allow all active and veteran servicemen and women to take advantage of various financial relief opportunities that are tailored to their needs. Such loans offer competitive rates and longer repayment periods when compared to other commercial loans. As a result, military loans offer more affordable payment terms. Also, these loans are processed faster than other types of loans. All the added perks of military loans are provided to help the men and women whose role is to fight for the country.
Below are some of the federal agencies that offer loan assistance to military servicemen and women.
US Department of Veterans Affairs
Among the most prominent federal agencies that give out loans exclusively to US military servicemen and women is the Veterans Affairs Office. The loan programs granted by this agency are referred to as VA loans. But it is important to note that the Veterans Affairs does not, by itself, issue the loans. They simply guaranty the entitlement of the servicemen and women to the loan packages being offered. The actual lenders are banks and other lending institutions. The loan programs offered by the agency can help protect the lenders in case of default. Since the loans are backed by the government, interest rates tend to be lower and the repayment period tends to be shorter when compared to more traditional loans.
VA loans are typically used by military borrowers to buy homes. The loan packages are available to both active and veteran military personnel.
US Small Business Administration
The Small Business Administration or SBA provides a big helping hand to countless entrepreneurs in the United States but it also has a number of loan programs designed to meet the needs of the men and women who serve in the military. One of the typical military loan programs offered by the SBA is the Patriot Express Pilot Loan Initiative. This program can be availed by active, disabled, and veteran military personnel. Reservists and members of the National Guard are also included as beneficiaries of this type of loan. Unlike other military loans, the spouses of the active or inactive servicemen and women can also apply for this relief package from the SBA.
Just like other SBA programs, loans granted to the military community under this facility are aimed to help the borrowers in establishing or expanding their own businesses.
Federal Housing Administration
Just like the US Department of Veterans Affairs, the Federal Housing Administration, or FHA, also assists US military servicemen and women when buying homes or properties. But rather than providing just the usual guarantee to loan entitlement, the FHA helps active members of the US military allocate reduced interest rates. Reductions can reach up to 6% annually. This rate reduction program has been authorized by the Service Members Civil Relief Act of 1940 and can be used on FHA mortgage loans.
US military personnel that want to take advantage of this financing relief need only to apply for the interest rate reduction. When granted, such request must be renewed periodically.