USAA Personal Loans Review | the ascent
No application fees or prepayment: USAA does not charge personal loan application fees or prepayment fees. Some banks charge loan origination fees which generally vary between 1% and 8%. The absence of prepayment charges means that borrowers can repay their loan faster at any time without being penalized.
Interest rate reduction for automatic payment: Borrowers who sign up for autopay will get a 0.25% discount on their interest rate.
Co-borrower option: USAA offers borrowers the option of adding a co-borrower to a personal loan. If you have bad credit, it can be difficult to qualify or get a competitive interest rate. Adding a co-borrower with a better credit score can help you qualify and potentially get a better interest rate.
Get funds quickly: The online application process takes minutes and if approved, borrowers can receive their funds as soon as 24 hours after closing.
What could be improved
Only military, veterans and family members are eligible. Eligibility for USAA Personal Loans is limited to:
- Those on active duty, national guard or reserve
- Veterans who served honorably
- Cadets or Midshipmen
- Spouses and Children of USAA Members
Longer payment terms require higher personal loan amounts. Loan repayment terms range from 12 months to 84 months. The length of the term depends on the amount borrowed. Loans with terms longer than 60 months (five years) must meet higher credit score requirements.
- A term of 12 to 36 months requires a personal loan of $2,500 or more
- A 48-month term requires a personal loan of $5,000 or more
- A 60-month term requires a personal loan of $10,000 or more
- A 72 month term requires a personal loan of $15,000 or more
- A term of 84 months requires a personal loan of $20,000 or more
Cannot be used for higher education. USAA imposes certain restrictions on how the personal loan can be used. USAA personal loans cannot be used to cover higher education costs.
No loan prequalification. Borrowers are unable to verify what they would be prequalified for without applying for a loan. This results in a difficult credit score inquiry, which can lower your score. The website only offers a loan calculator. Make sure you have shopped around and want a USAA personal loan before applying. Lowering your credit score just to check what your rate may be is a mistake when taking out a loan.