Are there laws on interest Loans for military?
I'm US Army, and while i was on leave back home, i bought a car. it was about 8,000 dollars, and I even with 5000 down, and a military paycheck, which is more consistant than any right now, I still had distress getting a loan. i fought for the whole week i was on leave and on the last day, they finally got me the loan. i mostly wanted the loan to start gaining my own credit, but it was nearly impossible. I had a 638 credit score. Not fantastic, but certainly not horrible. I got the loan at 30 percent interest though for 15 months, and that's over double my down payment. I heard there is a law that makes it so that Military cannot be charged more than 6 or 7 percent interest? Is this right?
If it is, or not, what is the best advice for maybe relieving this huge financial burden.
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Tags: 15 months, credit score, financial burden, getting a loan, Military Loans, paycheck, us armyTags: 15 months, credit score, financial burden, getting a loan, paycheck, us army
Yes – "One of the provisions of the FY 2007 Military Authorization Act, makes it illegal for creditors to grant payday loans and car title loans to military members.
The change also prohibits charging more than 36 percent interest to military borrowers. Fees, service charges, renewal charges, credit insurance premiums or any other product sold with the loan must be included when calculating the interest rate. In the past, there have been "horror tales" of military members paying up to 800 percent interest by using such gimmicks."
Unless there were some other fees and things not included in that 30% figure though it looks like the lender knew what they were doing and gave you the crappiest interest rate they could without breaking the law.