Adam McCann, Financial Writer
There are special loans for veterans, and they are offered through the Department of Veterans Affairs for very specific purposes. For example, you can get a VA loan to buy a home, refinance existing loans, tap into your home equity or borrow against your life insurance. But if these loans aren't good options for you, you will likely want to go with a regular personal loan instead.
Types of Loans for Veterans
- VA Home Loan: The Department of Veterans Affairs offers home loans to veterans and surviving spouses. The VA guarantees a share of the loan, which helps veterans get low interest rates with no private mortgage insurance.
- Interest Rate Reduction Refinance Loan: This loan from the VA lets veterans refinance an existing VA home loan to get a lower interest rate.
- Cash-Out Refinance Loan: The VA offers these home-equity loans, which allow veterans to borrow up to 100% of the value of their home, if they have enough equity. Equity is the home's value minus the mortgage balance.
- Veterans Life Insurance Policy Loans and Cash Surrenders: Veterans who have taken out a life insurance policy through the VA can borrow up to 94% of the cash value of the policy.
- Direct Home Loans for Native Americans: Native American veterans can use these loans to buy, build or improve a home on Federal Trust land, or refinance a previous home loan.
Personal Loans for Veterans
There aren't any personal loans that offer special discounts to veterans, unfortunately. However, there are personal loan providers that have a military affiliation in general, such as USAA, PenFed Credit Union and Navy Federal Credit Union. All three of these lenders require membership before applying for a loan, and veterans can join for free. They offer worthwhile personal loans, as well.
But you should also consider the many lenders without a military association, which may end up fitting your needs better. You can check out WalletHub's editors' picks for the best personal loans for veterans to learn more.
In addition, if you want ongoing borrowing power instead of a one-time loan, you can consider some of the best military credit cards.
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