Military servicemembers are protected through interest rate caps

Rewards for serving and protecting our country

By Ken Swarner on December 11, 2020

Service members have special protections to ward off predatory lenders trying to impose high interest rates.

"The Military Lending Act honors our military by helping them stay financially safe," said Eric Zittel, Vice President of Consumer Lending at Harborstone Credit Union.

The Military Lending Act (MLA) protects military and their families from wrongful loan practices, Zittel added. 

According to Zittel, the act was developed in 2006 after a rash of payday loan companies set up shop near military bases charging exorbitant interest fees. The act was amended in 2015 to expand protections in all lending situations, including credit cards.

"It ensures that there isn't a negative impact on our military," Zittel said.

Of course, places like Harborstone aren't impacted because they don't have loan programs that exceed the MAPR anyway. With military roots, the goal is always to help military members get the right lending products to help them thrive.

Still, acquiring a mortgage or car loan from a reputable lending institution like Harborstone will naturally protect military members because of their commitment to a member's good financial health. In fact, before paying a high interest rate, working with Money Management Coaches at Harborstone will help put your affairs in better order to secure lower interest rates.

"We are here to help our members prepare for expected and unexpected purchases before they have to pay high interest rates in an emergency," Zittel added.

For more information, or help with loan questions, contact Harborstone at 1-800-523-3641 or (253) 584-2260.

Military Onesource contributed to this article.