How to Fix Your Credit to Qualify for Military Service - dummies

How to Fix Your Credit to Qualify for Military Service

By Steve Bucci

Joining the military includes a review of your credit history. America owes a tremendous debt of gratitude to those who volunteer to defend this country and way of life. Not surprisingly, Americans take a dim view of those who take advantage of soldiers and sailors during their term of service. Here are some of the rules of engagement between the military and the financial-services sector.

Enlisting with credit issues

In addition to meeting rigorous moral character standards, those seeking to join the military undergo a background check that includes a review of their credit history. Uncle Sam doesn’t want to give you a loan; he wants to make sure that you don’t have existing financial problems, because you’re not likely to overcome those difficulties on junior enlisted pay.

Serving with credit issues

Credit problems happen in the military as well as in civilian life. Military personnel have extra protections under the law known as the Servicemembers Civil Relief Act. They’re entitled to enhanced protection from eviction, auto lease cancellation penalties, high interest rates, and being summoned to a court hearing while serving.

A program sponsored by the U.S. Department of Defense, Military One Source offers financial counseling if you’re having financial difficulties. Military One Source also offers confidential resources and support for service members and their families on a wide range of topics.

Twelve financial counseling sessions are available at no cost to active duty, Guard, and Reserve members and family members, as well as deployed Department of Defense civilians and their families. Financial counseling is available in person and over the phone in partnership with a vetted nonprofit organization (currently the National Foundation for Credit Counseling, or NFCC).

Counseling includes education and coaching in the areas of

  • Budgeting

  • The creation of a realistic action plan using specific, manageable steps

  • Housing (prepurchase, foreclosure prevention, and reverse mortgage)

  • Credit and active-duty alerts

  • Debt management

  • Debt collections

  • Financial-related deployment issues

  • The Servicemembers Civil Relief Act (SCRA)

  • Payday loans, title loans, and rent-to-own

To reach Military One Source, call 800-342-9647 from inside the U.S., 800-342-6477 from outside the U.S., or 484-530-5747 for an international collect call, or go to their website.