• How to Get Military Auto Loans with Bad Credit

    Military auto loans are normally considered good credit risks because of the steady nature of the employment. Military personnel can be seen by normal lending institutions as having bad credit because the normal means of building credit aren’t available to military personnel deployed overseas for extended periods of time. There are lenders that specialize in military car loans.


    There are some benefits to obtaining a military auto loan. It is recognized that you’re in the armed forces, and as such, you don’t have control over where you work. If you have this type of loan, you are authorized to drive your car anywhere in the US or overseas, as long as you have proper insurance for the location. Another big benefit is that there is no prepayment penalty for paying off the interest on your loan early. Loan lengths on military car loans are usually longer than for civilian auto loans. Approval is usually much quicker also.

    Obtaining military auto loans is a much quicker and easier process than it is for civilians. This process can often be completed over the Internet with many lenders. There are 5 things you need to do or provide in order to qualify:

    • Satisfy terms of service
    • Prove active duty service
    • Provide thorough contact information
    • Your email address
    • Contact details of a family member or responsible contact

    1. Meet Terms of Service

    This means length of service, not length or interest rate on any loans. As long as you are a serving active duty member of the armed forces, you qualify for a military auto loan, even with bad credit. Some lenders specify that you have a certain amount of time in service, while others say that as long as you are serving on active duty, you meet the criteria. Research various lenders that provide guaranteed military loans to find one with terms that are right for you.

    2. Prove Service

    Provide the lender with a copy of your orders or your active duty military identification card.

    3. Provide Contact Information

    Military lenders, such as Armed Forces Bank, require extensive contact information. This information includes:

    • Your local address and phone number while on active duty.
    • The name and address of the base you’re assigned to. (i.e. Fort Hood, Texas)
    • The name, address and phone number of the actual command you’re assigned to. (i.e. 5th Armored)
    • An American Post Office number for when you’re deployed.

    4. Provide Family or responsible contact

    In case the lender needs to contact you while you are deployed, you will need to supply the following information of someone the lender can contact and convey information to.

    • Name of a responsible contact or family member.
    • Address of the same responsible contact or family member.

    Most lenders who offer military auto loans also extend the same terms to retired members of the armed forces. Sometimes these loans will actually have better terms than for people actively serving.

    It is important to note that some lending institutions, such as Armed Forces bank require a 10 percent down payment on new cars and 20 percent on used cars.

    As long as you do your research, and don’t settle for the first loan offered, you can find the bad credit military auto loan to fit your situation and finances.