What is USAA?
USAA, one of the largest financial institutions for the military community, serves over 12.4 million members with branches in the U.S. and around the world. The San Antonio-based company was founded in 1922 by 25 Army officers who wanted to insure their vehicles.
If you want to take out a USAA loan, you must become a member. Active or former military members, cadets, midshipmen or eligible family members can join. Once you’re a member, you can access its financial services and products, including personal loans.
We will be reviewing the USAA personal loan, including some of the pros and cons, who it’s best for, and how to apply for one.
USAA personal loan highlights
- Fast access to cash: Once your loan is approved, USAA typically deposits the funds into your USAA account the same day.
- Less fees: USAA doesn’t charge any application, origination or prepayment fees.
- Membership required: Anyone who wants to apply for a USAA loan needs to become a member. Active or former military members, cadets, midshipmen or eligible family members are eligible to join.
- Discount available: USAA offers a 0.25% rate discount for those who opt for autopay.
- APR: Starting at 9.49%
- Minimum credit requirement: 700
- Terms: 12 to 84 months
- Fees: Late fee not specified
USAA Personal Loan Details |
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USAA product details
USAA provides a free service called the Financial Readiness Score, which is available to all members. It gives members insight into their financial well-being and includes a personalized action plan alongside tool and product recommendations to improve your finances.
Once you complete the assessment — it typically takes around 10 to 15 minutes — you’ll receive your score and an action plan. As you take the recommended actions, your score will update automatically.
Members also have access to various discounts such as travel, home security and tax preparation software. There’s also the USAA community, which is an online forum for USAA members. It also includes blogs and a section where you can receive financial advice from USAA staff.
Eligibility requirements
- Minimum credit score: 700
- Minimum credit history: Not specified
- Maximum debt-to-income ratio: Not specified
According to advertised rates on USAA’s website, you may be eligible to apply even if your credit score is less than stellar. A restriction that the company does have is that you can’t use a USAA personal loan for higher education purposes. Additionally, you’ll need excellent credit if you’re looking to qualify for terms greater than 60 months. You’ll also need to borrow at least $20,000 if you want to qualify for a 84-month loan.
Only USAA members can apply for a personal loan. To become a member, you’ll need to be:
- Active or former military: You qualify if you serve in the Army, Coast Guard, Air Force, Marines or Navy. Those who have been honorably discharged or are retired also qualify.
- Cadets and midshipmen: You’re eligible to become a member if you’re a cadet or midshipmen in advanced ROTC or on a ROTC scholarship at U.S. service academies. Officer candidates within 24 months of commissioning also are eligible.
Applying for a personal loan from USAA
You need to first establish membership with USAA before applying for a personal loan. The application form will ask you for information such as your name, address and Social Security number. USAA will also ask for proof of eligibility or your family member’s name if you plan on qualifying for membership that way.
Once you’re a member, you’ll need to create an online login and start the loan application process. You’ll need to provide information such as your income and employer details. USAA mentions that in many cases you’ll know if you’re approved instantly, as well as what your rate and terms will be. You may need to provide additional documentation for USAA.
If you’re approved for a loan, your funds will be deposited into a USAA bank account. If you want other options, contact USAA customer service at 800-531-8722 to find out what they are.
Pros and Cons of a USAA Personal Loan |
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Who’s the best fit for a USAA personal loan?
A USAA personal loan is best for those who want access to quick cash. As long as you have a USAA bank account, you can receive funds as fast as the day your loan is approved — a great choice for existing USAA members or those who intend on opening a deposit account with the bank. USAA loan terms range from 12 to 84 months. But you need excellent credit to qualify for terms higher than 60 months.
Alternative personal loan options
Earnest
- APR: 6.99%–18.24%
- Credit requirements: Minimum 680 credit score
- Terms: 36 to 60 months
- Origination fee: No origination fee
Earnest offers a lower rate than USAA and approves loans using a more holistic approach by looking at factors such as your savings rates, loan history and more. You can borrow between $5,000 and $75,000, except for residents of South Carolina, where you need to borrow a minimum of $7,500. Even though you can borrow a significant amount of money, Earnest doesn’t offer terms as long as USAA.
Marcus by Goldman Sachs®
- APR: 5.99%–28.99%*
- Credit requirements: Varies
- Terms: 36 to 72 months
- Origination fee: No origination fee
Marcus by Goldman Sachs® also offers a low starting APR and terms almost as lengthy as USAA. It’s a good alternative since you don’t need to become a member to take out a personal loan. The major upside is that there are no application, origination, prepayment or late fees with Marcus by Goldman Sachs®. If you need a large chunk of cash, it lets you borrow up to $40,000.
*For New York residents, rates range from 5.99% to 24.99% APR as of February 28, 2019
Avant
- APR: 9.95%–35.99%
- Credit requirements: Varies
- Terms: 24 to 60 months
- Origination fee: Up to 4.75%
Although the APR is higher than USAA — don’t forget there’s also an administrative fee when applying for a loan — you can borrow a lower amount, $2,000. You’re also subject to fees if you’re late or if you miss a payment. Some of the upsides include that Avant does a Soft Pull when determining your loan eligibility, and you could get your funds as quickly as the next business day once your loan is approved. Avant branded credit products are issued by WebBank, member FDIC.
