Banks, Credit Unions Offer 0% Loans to Military in Case Shutdown Delays Pay
Financial institutions for military members have plans to help keep customers paid in the event of a government shutdown.
Congress passed a bill earlier today to extend spending bill negotiations through May 5 — and keep the government running until then. But beyond that, the threat of a government shutdown still looms.
In preparation for any interruption in pay for active-duty military, several banks are stepping up to lend a hand — and in some cases, a loan.
Navy Federal Credit Union, USAA and First Command Financial Services have announced programs to support military members who may see an interruption in pay.
These Banks Will Help Military Get Paid if the Government Shuts Down
Heard of other banks that will provide special services to military members if the government shuts down? Let us know so we can add them to this post!
Navy Federal Credit Union
Navy Federal Credit Union will offer 0% interest loans to active-duty military members and civilian Department of Defense employees who have their paychecks direct deposited into their NFCU accounts and miss a check due to a shutdown.
You can register for this loan online. To get your loan on your usual payday, make sure you register by the day before your next scheduled direct deposit. If you miss that day, you can still register up to three days after your scheduled payday and get access to your funds on the same day or the first business day after you complete the registration, according to the NFCU site.
NFCU will calculate your loan amount based on your last paycheck before the shutdown — the bank will cap these loans at $6,000. The loan scale shows that members who register will get advances covering 50-99% of their most recent direct deposit.
The loans don’t require a credit check, and they will not show up on your credit report.
When your regular direct deposit resumes, NFCU will automatically withdraw the amount you received from your account as payment.
New credit union members are eligible for this benefit so long as they had their most recent paycheck direct deposited into their NFCU account. If you’re a member who hasn’t yet established a direct deposit link, you’re not eligible for this offer.
First Command Financial Services
If a shutdown occurs, First Command Financial Services will email all account holders who are federal employees or active-duty military who have their federal paychecks direct deposited to inform them of their eligibility for payroll advance loans.
“Payroll advances will only be made to clients who send us an affirmative response,” the program website states.
First Command says there are no fees or interest on these payday advances, which will cover the amount of the employee’s delayed direct deposit. The bank will also provide penalty-free early certificate of deposit withdrawals and waive cash advance fees on credit card accounts during a shutdown.
The bank intends to be able to cover the client’s normal net pay, said Mark Leach, vice president of media relations, by email. When normal direct deposit starts again, the amount provided as a payday advance will be deducted from the account.
“During the previous shutdown in October 2013 we stepped up to help our clients with payroll advances and other financial offerings,” Scott Spiker, chairman and CEO, said in a statement. “As we face the prospect of another government shutdown later this month, we again commit to help our clients and ensure their family finances are squared away.”
United Services Automobile Association
USAA will offer no-interest payroll advance loans to military members in the event of a shutdown.
“If a funding agreement is not reached and a disruption in military pay seems likely, USAA will email eligible members with information about how to sign up,” a blog post explains.
Active-duty USAA members will be eligible for payday loans if they have their federal paychecks direct deposited into their USAA account and have made two consecutive deposits in the past 60 days. Like NFCU, USAA will cap loans at $6,000 and automatically debit the loan amount once normal direct deposits resume.
Your Turn: Are you a member of the military? Do you have a financial plan ready in case a government shutdown delays your paychecks?
Lisa Rowan is a writer and producer at The Penny Hoarder.