USAA pre-commission loan rate hike warning

[EM1toNFO]

UPDATE:

I just got off phone with both banks.

USAA: 4.99% fixed APR for 60 months. Up to $25,000. Eligible for all officer candidates within 18 months of graduation. Must have your full pay direct deposited into an account there and have the payment auto-debited. If default on loan (i.e. not commission or > 60 days late payment) rate goes to 18.99%. You can apply over the phone and then have to have a document signed by CO verifying your commissioning status.

NFCU: 1.25% fixed APR for 60 months. Up to $32,000. Eligible for all officer candidates within in their junior or senior year of school. Must have your full pay direct deposited into an account there. Auto-debit isn't required. I don't know/didn't ask the rate after default. Application is mailed or faxed to you and again you have to have a document verified by your CO. you can either snail mail the application back OR fax it back.


So, all of you guys that have the USAA at 4.99% might want to look into swapping to a interest rate 1/4th of what you're paying.

 

[Treetop Flyer]

The USAA loan was basically free money when I did it. Three years ago you could easily get over 4% on something with no risk like a CD. It's just them giving you 25,000 to make interest on. CD's are a lot lower now that the economy shit the bed but the Navy Fed one still seems like a good deal.

 

[beaverslayer]

UPDATE:

I just got off phone with both banks.

USAA: 4.99% fixed APR for 60 months. Up to $25,000. Eligible for all officer candidates within 18 months of graduation. Must have your full pay direct deposited into an account there and have the payment auto-debited. If default on loan (i.e. not commission or > 60 days late payment) rate goes to 18.99%. You can apply over the phone and then have to have a document signed by CO verifying your commissioning status.

NFCU: 1.25% fixed APR for 60 months. Up to $32,000. Eligible for all officer candidates within in their junior or senior year of school. Must have your full pay direct deposited into an account there. Auto-debit isn't required. I don't know/didn't ask the rate after default. Application is mailed or faxed to you and again you have to have a document verified by your CO. you can either snail mail the application back OR fax it back.


So, all of you guys that have the USAA at 4.99% might want to look into swapping to a interest rate 1/4th of what you're paying.

When I spoke to NFCU they said that their loan was only available through the Coast Guard Academy branch of the bank, so applicants would have to actually be in that area to get the loan.

 

[EM1toNFO]

When I spoke to NFCU they said that their loan was only available through the Coast Guard Academy branch of the bank, so applicants would have to actually be in that area to get the loan.

Nope, I have the loan application in my hand.

 

[beaverslayer]

Touche'. Apparently I was misinformed.

EDIT: I just got off the phone again with NFCU, and was told they don't handle loan applications over the phone--did you go to a branch to apply for it? That APR is definitely way better looking than USAA's, I just can't seem to talk to anyone there that knows how to help me!

 

[EM1toNFO]

1 800 914 9494

Listen for the "Apply for a loan" option.
Tell them you want to apply for the "Pre-Commissioning/Career Starter Loan."
Have a fax number handy for them to fax the application to you OR wait to have it mailed via postmaster to you.
Ask for their fax back number so you can fax the application back to them OR send it back snail mail.

Those are the steps I did. Didn't have any issues, going to send off the application via the fax tomorrow or next day.

 

[Picaroon]

USAA told me that the best they can do is give me their loan 4 months from my expected commission date as a BDCP guy. However, I'm not sure if it's worth it to go to Navy Federal if I have to send all my pay there. The USAA loan at 4.99% wouldn't really help me unfortunately because that's not much lower than my car loan and you can't make money on that in CDs right now.

 

[scoolbubba]

cant you just set up direct deposit to NFCU and then set up an automatic debit to a usaa account if you wanted to use USAA but take the loan with NFCU?

 

[beaverslayer]

1 800 914 9494

Listen for the "Apply for a loan" option.
Tell them you want to apply for the "Pre-Commissioning/Career Starter Loan."
Have a fax number handy for them to fax the application to you OR wait to have it mailed via postmaster to you.
Ask for their fax back number so you can fax the application back to them OR send it back snail mail.

Those are the steps I did. Didn't have any issues, going to send off the application via the fax tomorrow or next day.

Thanks for the information! You would think after talking to three different people at NFCU they would have been able to tell me that themselves...

cant you just set up direct deposit to NFCU and then set up an automatic debit to a usaa account if you wanted to use USAA but take the loan with NFCU?

Now there's an idea worth looking in to. Although, even though I already have a USAA account it seems like it would be way easier just to switch over to NFCU completely and be done with it.

 

[m26]

Can you take the pre-commissioning loan and then the career starter loan once you commission, or is it either or?

 

[desertoasis]

Can you take the pre-commissioning loan and then the career starter loan once you commission, or is it either or?

They're the same thing.

 

[beaverslayer]

One more update from my end, hopefully relevant information that will clear things up. I just spoke to NFCU again, after re-reading the conditions of their career kickoff loan (which is what they're calling it now). To avoid defaulting on this loan, you have to have a direct deposit set up with them within 90 days of receiving the loan. And if that is available any junior or senior is eligible for the loan. No big deal for a prior enlisted, ROTC, USNA or even BDCP type, but in my case (Direct Ascension to OCS) I will not be on the Navy payroll until I hit OCS, and would therefore default on the loan if I were to take it out right now. So I guess I'm just going to have to wait until I head to OCS.

 

[squeeze]

cant you just set up direct deposit to NFCU and then set up an automatic debit to a usaa account if you wanted to use USAA but take the loan with NFCU?

That's basically what I did when I got mine. I didn't have to choose "either/or" - I took both! I used direct deposit to USAA for my pay, and setup an auto-transfer to NFCU every month for like $5 more than the loan payment was. Sure, some may say taking on $38k of debt right out of college may be irresponsible already having having student loan debt and all, but I counter with 2 new vehicles, not working my last semester, and living like a rockstar. What a shame they make you deposit the "full amount" of your pay now.

I wouldn't go full retard with USAA or NFCU. Keep accounts with both. Both offer free checking/savings, so just keep a small amount in one or the other. I use USAA for everything but my mortgage, but NFCU has branches on/around most bases, so it's handy for some face-to-face stuff.

 

[acwildcat]

Has anyone in BDCP gotten this loan? I am a junior in BDCP and it would be nice to pay off motorcycle and credit cards and get that nice low interest rate but from talking to them it sounds like it is basically just for people in the military academies. Any help would be greatly appreciated. Thanks guys

 

[beaverslayer]

That's basically what I did when I got mine. I didn't have to choose "either/or" - I took both! I used direct deposit to USAA for my pay, and setup an auto-transfer to NFCU every month for like $5 more than the loan payment was.

Did they charge you a fee to transfer that money every time? NFCU is requiring a deposit of the full salary to qualify for the loan, but USAA has been way easier to deal with so I'd like to keep using them for my checking/savings. But if each transfer costs some kind of fee it hardly seems worth it.