You’ve done your duty. You’ve served our country and done your part to protect our freedom. And now, you find yourself in debt.
You’re not alone. Debt amassed while in the military makes transitioning back into civilian life difficult for many veterans. Don’t worry, though. Help is available.
Debt relief is a solution that will allow you to find financial peace and security during this time of transition, by giving you debt management tools designed specifically for your needs. This blog post will explain the benefits of debt relief for veterans and help you understand how debt relief could help military members and their families.
What is debt relief?
“Debt relief” is the process of restructuring or refinancing debt to ease stress and improve your financial situation. There are a number of different debt relief paths available, including debt management plans, debt settlement, or debt consolidation.
Where do I start?
The best way to get started with debt relief is to meet with an experienced debt consultant, who will review your debt and help you determine the best possible solution for your specific needs. Reputable debt relief companies offer free debt consultations to help determine whether they’re the best fit for your situation.
Benefits of Debt Relief for Veterans
The main benefits of any debt relief option is that it can help make paying off your debt easier and assist you in strengthening your finances. With Debt Settlement in particular, you may also benefit from a reduction in the amount you must pay back. This means you’ll have more money in your budget for savings and living costs. This reduced debt can also help relieve stress and allow you to obtain the financial freedom you deserve. Furthermore, debt relief can in some cases protect your assets, preventing debt collection lawsuits from being filed against you. Lastly, debt relief could help boost your credit rating, which can give you more options and flexibility for future purchases and loans.
Debt Help for Military Spouses
If you’re a military spouse struggling with debt, you too may qualify for debt relief programs. Some debt relief programs are offered exclusively to military families, thanks to the Servicemember Civil Relief Act.
Types of Programs Available to Veterans
Many debt relief programs are available to veterans. One type of program best known for reducing debt is known as “debt settlement.” With this option, a trusted advocate (like CreditAssociates) will negotiate with your creditors to lower the total amount of your debt, putting you on an affordable payment plan and a path to financial freedom. With debt settlement, you could be debt-free in as little as 24 months. The best way to begin this process is to check out our debt calculator, to see how much you could save.
Before choosing a debt relief path, it’s important to weigh the pros and cons to see what will work best for your needs and lifestyle. Some debt relief options vary for active duty vs. retired military personnel, so this is another element to research and consider. Some other potential options for vets:
Servicemembers Civil Relief Act
The Servicemembers Civil Relief Act (SCRA) is a debt relief law that offers protections to military members. The SCRA provides benefits such as suspending interest charges on debt incurred before service begins, limiting debt collection activities, and setting minimum payments for certain debts during periods of active duty. It also limits interest rates on credit cards and mortgages to as low as 6% while active-duty service members are deployed.
The Military Lending Act
Active duty service members and their families are protected from predatory lending practices by the Military Lending Act. The law does this by creating a Military Annual Percentage Rate (MAPR), which applies to certain types of loans. It also bans penalties for paying back part or all of your loan before it’s due, and it keeps lenders from forcing service members to give up legal rights when it comes to debt arbitration (the process of resolving unpaid debt that is long overdue or tied up in bureaucratic red tape).
Why is debt relief important for veterans?
Owing large sums can make it difficult to sleep at night. In this sense, veterans are just like any other person who is dealing with the stress of debt. Debt relief can also be crucial for a veteran’s family. Financial stress in one household member can cause an emotional toll on the rest of the family, as others try to pick up the slack or provide support during tumultuous periods (such as deployment).
In some circumstances, debt relief can also be a good tool for boosting your credit score, which unlocks greater buying power and financing options for large purchases like a home or car.
Military & Veteran Debt Statistics
- About one-third of military families struggle to pay their bills on time.
- 1 in 10 service members have debts in collection.
- 27% of service members have more than $10,000 in credit card debt (compared to 16% among civilians)
CreditAssociates Can Help.
We appreciate your service and we’re here to help. Through our debt relief program, we’ll negotiate with your creditors to reduce the amount of debt you’re required to pay back. Then, we’ll provide you with an affordable repayment plan to help tackle the remaining amount. Plus, our Customer Success Team will be available every step of the way. Want to learn more? Our expert debt consultants offer free, no-commitment debt consultations to help you decide if we’re the best fit for you. Call or fill out our form to get started on your free debt consultation.
More Common Debt Relief Questions for Veterans:
Does the military offer debt relief?
The military will not bail you out of debt, but there are many options for military families. These include the Servicemembers Civil Relief Act, the Military Lending Act, VA Loan Modification, special forbearance, and a Military Debt Consolidation Loan (MDCL), also known as a VA Consolidation Loan.
What is a VA hardship?
VA hardship is an option if your current VA copay debts are creating a financial problem for you or your dependents. You’re eligible for VA hardship if your VA payments are keeping you from affording basic living needs such as food, medical care, housing, and/or transportation.
How do I get my VA debt forgiven?
To get your VA debt forgiven, you’ll need to prove that debt payment would cause financial hardship. To do this, your finances must fall below the federal poverty guidelines, and you will be required to submit evidence of income and expenses for review. If you don’t think you qualify for debt forgiveness and you cannot afford to make your current payments or feel like you have too much debt, debt settlement could be a good option for you.
How do I get a VA debt waiver for my student loans?
As a veteran, one way to get debt relief on student loans is through a VA debt waiver, which allows you to apply for one-time debt forgiveness on your federal student loans, including direct loans and Federal Family Education Loan (or FFEL) Program loans. Debt settlement is an additional debt relief option that could also help with private student loans. Read about additional student loan relief options in this blog post.
Are there personal loans for veterans?
Veterans are eligible to get debt relief through personal loans. If you have credit card debt, personal loans can be an option to get rid of your debt and put it all in one place with a lower interest rate. However, this strategy is typically harder to qualify for if you don’t have good credit.
Will debt relief ruin my credit?
The impact of debt relief on your credit score will vary depending on which path you choose. Some solutions can have an initial negative impact on your score after you start the program, but will ultimately have a positive effect as your debt is resolved. Overall, debt relief can be a great option for strengthening your finances if you can follow and commit to the plan or program. Debt relief is designed to bring down the balance of debt you owe, which can improve your credit score over time.
Is debt settlement really worth it?
In most cases, yes. Debt settlement can be a great option to reduce debt, especially if you’re struggling to make your monthly payments or you feel like you owe too much. With debt settlement, you could reduce the overall amount you owe and pay off your debt in as little as 24 to 36 months.