Military Debt Relief

InCharge Debt Solutions recognizes that service members from all branches of the US military face unique financial challenges related to frequent relocation, deployment, disability and PTSD. InCharge offers credit counseling 100% free of charge. We’re here to help.

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Five Military Debt Relief Programs

Members of the military have plenty to worry about when they are serving our country. The last thing they should have to worry about is if they paid the mortgage and credit card bills off this month. The good news is laws protect them from many civilian credit worries. The bad news is a lot of military personnel still suffer severe financial difficulties and have a hard time finding veteran debt-relief options.

Here are five programs designed to help active duty military and veterans with debt relief:

  1. Servicemembers Civil Relief Act – Regulates interest rates for credit cards, auto loans and other financial services for active duty military. Also requires landlords to let you out of your lease, without penalty, for deployment.
  2. Military Lending Act – Servicemembers cannot be charged more than 36% interest for credit products.
  3. Veteran’s Housing Benefit Program – offers loans to veterans at very low rates.
  4. Nonprofit Credit Counseling – Free financial counseling provided by nonprofit companies like InCharge Debt Solutions.
  5. Debt Consolidation – There are a few options in this category, any one of which could provide the debt-relief solution best suited for your problem.

If you are an infantryman in Afghanistan or a civilian in Denver, debt consolidation – whether it’s a debt management program, a debt consolidation loan, debt settlement or in the most severe instances, bankruptcy – can ease the strain. Debt can feel unending, but there is a way to seek military financial help through the following options.

Military & Veteran Debt Consolidation Loan Options

If you are looking for a debt reduction plan, a good place to start would be examining the interest rates you pay on your current bills, especially credit card debt and compare those against the interest rate charges for a debt consolidation loan. Debt consolidation is taking out one loan to pay off several smaller loans. It is most often used to eliminate credit card debt because debt consolidation loans have far lower interest rates and agreeable terms. For example, depending on your credit history, you could get a debt consolidation loan of 8%-10% interest rate to wipe out credit card debt that probably has reached 25%-30%. There are several types of debt consolidation loans – personal loan, home equity loan, balance transfer loan, loan from family or friends – and each has its advantages and disadvantages.

  • Personal loan: This is the most common form of debt consolidation. You go to a bank, credit union or online lender, ask for the amount you need to pay off credit card debt, they check your credit score and payment history and approve or disapprove your loan. Personal loans accounted for $305 billion in borrowing in 2019, an astounding 121% increase over 2018. Online lenders are doing most of the new business in this area.
  • Home equity loan: This loan has the lowest interest rates for one very important reason: You are putting your home up as collateral. If you miss payments, you could lose your house. In return, you get interest rates as low as 6% compared to the national average of 17% for credit cards.
  • Balance transfer cards: The attraction here is that you pay 0% interest for an introductory period (usually 6-18 months), giving you time to pay off credit card bills at no interest. However, it’s very difficult for people already in trouble with credit cards to qualify for a 0% interest card. If you do qualify for one, you must pay off your debts in the allotted time or your rate soars to 18%-20% or higher.
  • Family or friends: This could be the place to get the lowest rates and best repayment terms IF both sides trust each other and act responsibly. IF they don’t, this can ruin relationships and be a really bad idea.

If you’re not happy with any of these choices, you could consolidate your debt without a loan through a nonprofit credit counseling agency. Credit counselors walk you through the steps of setting up a monthly budget and then recommend debt-relief options. One of those is a debt management program, which doesn’t require a loan and doesn’t consider credit score as part of the qualifying process. Debt management programs are a good way to eliminate debt, eventually increase your credit score and relieve stress from financial problems. Counselors work with lenders to reduce the interest rate you’re paying and the amount of your monthly payment so that all debt is eliminated in a 3-5 year time frame.

Military Debt Relief Programs and Services by InCharge Debt Solutions

From free budget and credit counseling to personal finance books and podcasts, InCharge Debt Solutions is dedicated to serving those who serve our country. Financial readiness keeps our troops and our nation strong.

Debt and Your Military Security Clearance

Service members are held to a higher standard than civilians. They can’t abuse alcohol, drugs or even credit. Article 134 of the Uniform Code of Military Justice spells it out: Service members who don’t pay their bills “bring discredit upon the armed forces.” They can lose their security clearances, promotions and even face court martial if they fail to live up to their financial obligations. Despite such consequences, 36% of military service members have trouble paying monthly bills, according to a study by the Financial Industry Regulatory Authority (FINRA). That’s also why you see so many payday lender storefronts outside the gates of military bases. The payday lenders won’t tell you that making only one monthly payment on a debt management program or debt consolidation loan with lower interest rates might be the best route to solvency. Instead, they will offer the quick solution of taking out a payday or auto title loan where the average interest rate is 400% and could be as high as 1,000%. If you’re even slightly tempted by the flashing signs, please take a deep breath and start exploring other debt-relief options. The Servicemembers Civil Relief Act is your friend.

Servicemembers Civil Relief Act

It’s been around since 1940 and was initially called the Soldiers’ and Sailors’ Civil Relief Act, though its origin dates back to the Civil War. Congress passed legislation that gave relief to soldiers who could not pay their debts while at war. Union privates made all of $13 a month in the Civil War, which was actually $2 more than their Confederate counterparts. That wasn’t a lot, but at least they didn’t have to deal with collection agencies threatening to ruin their credit score. The Servicemembers Civil Relief Act limits those hassles and provides other protections for active duty personnel. The law bans creditors from proceeding with foreclosures, evictions, garnishments and repossessions and other actions until 60 days after a service member returns from active duty. When service members are called to active duty, lenders are required to set a maximum interest rate no higher than 6%. Despite such protection, studies show that more than one in four military families carry $10,000 or more in credit card debt, and 10% of families owe $20,000 or more. More than half of enlisted and junior non-commissioned officers reported they often make only minimum payments on their credit cards.

Homeowners Assistance Program (HAP)

Homeownership is practically a given in the military – 51% of millennials in the military are homeowners – but with that comes another given: There is likely to be problems keeping up with payments. The Department of Defense recognized that and set up the Homeowner Assistance Program (HAP), which provides financial assistance to qualified candidates facing a crisis concerning their housing. HAP covers active service members, veterans, surviving spouses and civilians working in the Department of defense. It provides financial assistance for those facing foreclosure, having to sell their home at a loss or being unable to sell their home. Members of the Armed Forces who incur a wound, injury or illness in the line of duty during deployment (30% or greater disability) also qualify for assistance. Applicants who qualify receive financial assistance under one of three scenarios:

  1. Private Sale: Benefit amount is the difference between 95% of the home’s prior fair market value and the selling price. HAP may also reimburse the applicant for normal and customary seller’s closing costs;
  2. Government Acquisition: Benefit amount is the greater of 90% of the home’s prior fair market value OR the mortgage(s) payoff amount;
  3. Foreclosure: Benefit is paid to the lien holder for legally enforceable liabilities.

The Military Lending Act of 2006

The Military Lending Act in 2006 limits such predatory practices. More relief is offered through the Veterans Administration. The VA home loan program usually looks at only the previous 12 months of credit history unless bankruptcies, tax liens or collections are involved. It also doesn’t require a down payment, and interest rates are typically lower than those offered with conventional loans. Military service members can also get a loan by refinancing their house through the VA. Qualified veterans can use the Interest Rate Reduction Refinancing Loan to obtain a lower interest rate or change from a variable rate loan to a fixed rate. If you want to take cash out of your home equity, the Cash-Out Refinance Home Loans programs lets you replace your current loan with one that has new terms. The danger is your house is collateral and can be foreclosed if you don’t make the payments. Such decisions require careful consideration.

Free Credit Counseling for the Military and Veterans

InCharge Debt Solutions offers free credit counseling to the military and veterans.  If you qualify, you may join a Debt Management Plan, which could help you pay off your debt over three to five years. Instead of having an array of bills to keep track of, debt consolidation or a Debt Management Plan would mean writing one check per month. Whether that’s the answer or not, there are far better solutions than the quick fixes offered by payday lenders outside of military bases. The last thing a member of the military needs is for bad credit to make them a discredit to the armed forces.

Military Debt Consolidation

If you are looking for a military debt consolidation program, InCharge’s debt management program may be a good fit for you. With this program, you can consolidate your debts without taking out a new loan. Our online credit counseling tool will help you determine if you qualify. If you do, you will be able to see an estimate of your monthly payment after your individual monthly payments are consolidated. We also will provide you with an estimate of how much you will save in interest and time on our program.

InCharge Debt Solutions Military Debt Relief Programs

As a way of honoring military service and showing appreciation for the sacrifice of military families, InCharge offers these tailored resources:

  • Military Money Articles. InCharge is proud to publish Military Money articles on a comprehensive personal finance portal for service members and their families. Find informative articles, videos and podcasts about the GI Bill, VA loans, Thrift Savings plans and much more.
  • Free military and veteran eBooks. Recent publications include Defending Your Home, a guide to military housing issues, and Transitions: Where Do I Go from Here? How to transition from military to civilian life.
  • Daily tips-oriented Military Money Minutes broadcast on Armed Forces Radio.

Defend Your Home Ebook

Defending Your Home – eBook

Defending Your Home is designed for service members, veterans and their families to help with navigating the special housing challenges faced by those who serve. May this book help you establish and maintain your own personal and financial security through sustained homeownership.

Download From iTunes

Kindle & Other Formats

Grants for Active Military and Veterans

The VA has a number of grant programs designed to help veterans and military families deal with everything from finding a permanent residence to gaining access to cultural community events to hiring legal aid to receiving financial aid for a college education. The grant money is generally awarded to local civic and religious groups who then disburse it to veterans and active military. To find the list of available grants for the military service members and veterans, visit these sites:

  • – This site is part of the Veteran Administration and offers grant information on locations for applying for grants.
  • – Lists grants from all over the country for nonprofits, faith-based organizations and 501 (c)(3) to help veterans with everything from finding a home to technical training for a job.
  • – This website focuses on grants for veterans and their dependents.
  • – This site, like Finaid, has a long list of places for veterans, service members, their spouses and dependents to check for grants to attend college.
  • – Features a page on 10 benefits that veterans might not know about, including information on long-term care, certification programs and unused GI Bill benefits.

Veterans Administration Debt-Relief Options

The VA offers vets in financial trouble several options, depending on the source of their problem. For example, the Loan Guaranty Service may work with mortgage companies and banks to ask forbearance for those Veterans having difficulty paying or work out a reasonable payment plan to keep the Veteran in his or her home rather than go to foreclosure. If you are a borrower and want to contact the VA Loan Guaranty Office regarding any aspect of your mortgage, please call 1-877-827-3702, with hours of operation from 8 am to 6 pm, EST. Please visit the trouble making payments web page if you have financial trouble or some other circumstance regarding your VA home loan. VA also makes financial planning and online will preparation services available at no cost to beneficiaries of:

  • SGLI (Servicemembers’ Group Life Insurance)
  • TSGLI (Traumatic Injury Protection)
  • FSGLI (Family Servicemembers’ Group Life Insurance)
  • VGLI (Veterans’ Group Life Insurance)

The financial counseling and online will preparation services offered here are only for SGLI, VGLI, and FSGLI beneficiaries and Servicemembers who have received TSGLI benefits. Servicemembers who are interested in financial counseling, but have not received a TSGLI payment may contact their Command Financial Specialists or Financial Readiness Counselor. For Veterans who are not a beneficiary of one of the benefits listed above and is not able to access this free financial counseling service provided by VA, they may find free or low-cost financial counseling options through various nonprofit organizations, including:

  • Credit unions
  • Extension offices
  • Religious organizations
  • Nonprofit agencies

It’s important that the Veteran’s credit counseling service be accredited by either of these organizations:

Furthermore, Veterans may seek advice and support through VSO’s and MSO’s who provide financial readiness and planning training for those during transition. For example, the USO’s Pathfinder Program provides no-cost financial literacy resources to transitioning Servicemembers and their families up to one year after they separate from the military. The Supportive Services for Veteran Families (SSVF) program awards grants to non-profit organizations to help very low-income Veteran families that are homeless or at risk of homelessness. SSVF grantees provide a range of supportive services to eligible Veteran families that are designed to promote housing stability.

Additional Online Resources for Military Families

The Department of Defense and Military Services offer service members and families military debt relief through networks of financial literacy and preparedness resources, including one-on-one financial counseling. Navigating through the internet to find these programs isn’t easy, but that is why we are here to help. To find more information on financial readiness resources, education and support, please go to:

  • Military OneSource – This service is provided by the Department of Defense at no cost to active, Guard and Reserve (regardless of activation status) and their families.  The program provides service members with a connection to an NFCC Member Agency, like InCharge Debt Solutions, and offers funding for up to 12 counseling sessions per family.
  • Explore VA Health Care Benefits – Explore VA provides a fast way to learn about VA benefits, find out which ones you may be eligible for, share information with friends and family, and apply for benefits.
  • Military INSTALLATIONS – This is the official DoD source for installation and state resources available to active duty, guard and reserve service and family members.
  • S. Military Personnel and Veterans page of – Here, you’ll find resources and official information for active duty military personnel, including history, support for families, benefits, career assistance, education and much more.
  • Servicemembers HomePage, Consumer Financial Protection Bureau – This government website has sections on Planning Your Future and Protecting Your Finances and much more.
  • Veteran’s Affairs Website – The U.S. Department of Veterans Affairs provides detailed information on health care benefits, life insurance, pensions, home loans, survivor benefits, education and much more.
  • – This is a good resource, which explains in plain language the many benefits available to active duty personnel, reserves, National Guard, retirees, veterans and their families.

Military personnel, especially those trying to live on a budget for the first time, face a lot of economic pressure. Fortunately, there are government agencies and nonprofit credit counseling services to ease you through the trouble. If you’re a servicemember who recognizes that you’ve overextended yourself financially, take advantage of the free counseling services offered by InCharge or go online and research what is available to help you successfully eliminate debt.

About The Author

Joey Johnston

Joey Johnston has more than 30 years of experience as a journalist with the Tampa Tribune and St. Petersburg Times. He has won a dozen national writing awards and his work has appeared in the New York Times, Washington Post, Sports Illustrated and People Magazine. He started writing for InCharge Debt Solutions in 2016.


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