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Debt Relief for Members of the Military and Veterans

Debt Relief for Members of the Military and Veterans

Debt relief isn’t really different for different occupations except for members of the military and anyone that requires security clearance. Security clearance is often something you’ll need to ask your manager about. If you are enrolling in a debt relief program, you'll want to be a little cautious that it doesn’t jeopardize your employment or have any other implications on your employment.
Veterans should also be mindful of a few things, as we'll discuss next.
Active Military and Veteran Benefits
Consumers with an USAA account, Military Star account, Navy Federal CU or any similar account with a governmental/military backed organization. It’s mindful to be aware of the fact that if consumers do have accounts with one of these institutions they could potentially lose benefits with their account provider if you end up settling debts with these creditors. For example, some military member could lose USAA insurance benefits if they settle account balances for a USAA credit card. Moreover, the consumers who have FCU accounts could potentially have accounts that are tied to one another via cross collateralization.
Cross Collaterialization
Cross collateralization occurs when you have one account with Navy FCU that is an auto loan and one account that is a credit card. In this scenario, debt settlement companies should refrain from including these accounts in the program. Credit Unions have this process called cross-collateralization, so if you stop making payments on your credit card account, Navy FCU does technically have the right to apply your auto loan payment to the credit card in case you default on your auto loan. In this scenario, you do not want to default on your auto loan since this could lead to repossession of your car after a number of missed payments and would make your credit card account essentially illegible for settlement. This is why debt relief companies should avoid enrolling these accounts to prevent problems down the line.
Whatever the case is if you are a military member, there are some valid concerns you should have with enrolling in a debt relief program. First make sure you are okay with losing any benefits from the cards you enroll in the program. As an active military member and a veteran there are certain benefits you get that you may want to hold onto. Some of these benefits can be multi-generational and so it’s worth considering removing them from the equation since these might be something you want to keep.
Unaffected Items
There should not be any impact to anything that is outside the debt relief program and that isn’t related to accounts you enroll in the program. Now, if you have a VHA loan on your home or anything similar this will not be impacted by the debt relief program. It's best not to assume with these types of things and make sure you speak with a manager regarding the option, if it's something you decide to move forward with.
Be Aware of The Consequences
There are definitely some reasons you should be skeptical.
Members of the military should be cautious about unforeseen consequences when signing up for debt relief. However, barring any security clearance issues and loss of other military benefits, there really isn’t anything that would otherwise prevent you from enrolling in a program. You will save a good deal of money!
Moreover, although there are consequences this strategy still reams extremely effective at helping consumers get out of debt in a very short time frame. This often is the best way out of debt with the least associated side effects and consequences.
This is why it’s important consumers have all knowledge at their disposal so they are able to make the best-informed decision possible given their circumstances. Consumers who make decisions based on limited information can be at a loss. The more information you have the better it’s going to be for you and your financial future.
The best way to get out of debt is to stick to your plan and perform a monthly budget. Without a budget, consumer cannot reliably expect to understand their financial standing. Members of the military can especially feel this way due to their occupation. Feel free to use our budget calculator tool in order to achieve this.
If you’ve been carrying high interest credit card debt for an extended length of time you should consider now as good a time as ever to eliminate your debt and try to launch your life into a better direction.
Debt Isn’t Fun
Debt isn’t fun by any means but as we progress through our financial lives and things change we need to try our best to adapt. Debt relief is a viable way for everyone, not just members of the military to regain their financial footing. It’s a very reliable path to debt freedom.
Debt relief really can be a great option for members of the military but you just need to be mindful of any potential loss of benefits from settling with some of these creditors.