Military Lending Act: Understanding Costs & Regulations

Since 2007, the armed forces have tried to regulate military costs with bills like the military lending act. A soldier's loan was sometimes managed by specialist companies who would charge high interest rates. The new military lending act was designed to prevent high rates and fees.

Military Lending Costs

The law of 2007 put into motion regulations that established caps that limited lending amounts. The cap is usually placed at 36%, some states have lower caps. However, all states have a maximum rate of 36% rate. Despite these precautions, soldiers are still vulnerable to other offers, such as payday loans. These types of loans are still charging somewhere around 350% for loans. Payday loan companies will not publish their interest rates. Also, they will not ask you for a credit check before they offer you a loan.

Special Lending Programs

Getting VA loans is one way to ensure that you receive a loan within the correct interest rate. Review the VA website to find an approved list of lenders that can help you with your lending needs. Also, research and compare a few rates in your area so that you can be certain that you are getting a competitive and fair loan.