As the public health crisis posed by COVID-19 worsens, many Americans across the country are experiencing significant financial shock. Servicemembers, veterans, and military families are no exception.
Although veterans will continue to receive their benefits and active-duty servicemembers will continue to receive their pay, some military personnel and their families are facing financial strain due to lost employment or changes in military orders. If you need financial assistance as a result of the pandemic, there is help.
A financial shock or loss of income can feel overwhelming. You may have a number of decisions to make, but remember that you’re still in control of your money. Take stock of your finances and then make a short-term plan for the way forward. Learn three steps to take when money is tight.
While you can take steps to help protect yourself or loved ones from the financial impact of the coronavirus, members of the military also have access to special programs for financial relief.
Military aid societies can help
Emergency grants and zero-interest loans may be available to help cover lost pay, childcare costs, rent/mortgage assistance, quarantine expenses, or other financial emergencies. Servicemembers and military families experiencing coronavirus-related hardship can apply for help through their respective military aid society: , , , or .
The aid societies will also consider applications for assistance from activated (Title 10) National Guard and Reserve members on a case-by-case basis. Activated National Guard and Reserve members may qualify if they are experiencing financial hardship due to a cancelled deployment, the travel ban, or other relief society stipulations. Army Emergency Relief will also consider applications from non-Title 10 Guard and Reserve soldiers with the same stipulations.
All military aid societies, except the Navy-Marine Corps Relief Society, have an online application. All members of the Armed Services can also apply by phone for financial assistance – routed to their service branch relief society – through the .
Pay and allowances
The DoD has authorized specific in a variety of situations. Those include people who have been ordered to self-isolate or monitor for COVID-19 but are unable to do so at home or at government facilities. Military families affected by the , which halts Permanent Change of Station (PCS) moves and other military travel until May 11, 2020, may also be provided specific travel allowances. Check with your command to see if you’re eligible for Hardship Duty Pay or other additional allowances such as Basic Allowance for Subsistence (BAS), Family Separation Allowance (FSA-Restricted or FSA-Temporary), or per diem travel allowances that can provide you with additional financial support.
Contact your command and service branch shipping office immediately if you’re experiencing financial hardship because you’re separated from your personal and household belongings due to the Stop Movement Order.
Some servicemembers may have trouble managing their mortgage payments because of financial hardships associated with COVID-19. A new federal law, the Coronavirus Aid, Relief, and Economy Security (CARES) Act, establishes protection for homeowners with federally backed mortgages —which includes loans guaranteed by , , the or . If you have a mortgage that isn’t backed by the federal government and can’t make your payments, your mortgage servicer or your state may be offering additional options.
If you rent, you may have protection under the CARES Act, especially if you’re renting from a property owner with a federally backed mortgage. Some states have also acted to prohibit landlords from evicting residents if they can’t pay rent. Check the websites of your state government, , or for details and updates.
If you’re a servicemember with federally-held student loans, the CARES Act also automatically suspends principal and interest payments on federally-held loans through September 30, 2020. However, if you have private student loans or a federally-backed loan owned by a commercial lender or the institution or school you attended, contact your servicer if you can’t make your loan payments. They may have some options to help. If your federal student loan is in default, please be aware that involuntary collection activities like wage and benefits garnishments have been suspended during this period. No one should be contacting you to collect or taking collection action. However, you can continue to make payments to bring your loan up-to-date if you have the means.
If you’re a servicemember or military family in need of financial advice, whether it’s navigating COVID-19-related financial hardships or handling other money matters, you can also get one-on-one financial counseling remotely, by phone and video, from .
Military consumer protections
There are two important consumer protection laws specific to servicemembers. The and the provide legal and financial protections for active-duty servicemembers, military spouses and National Guard personnel and reservists on active duty for more than 30 consecutive days. Some protections apply to some dependents as well.
The SCRA gives you the ability to terminate contracts like vehicle leases, cell phone plans, and residential leases under certain conditions without having to pay early termination charges. It provides protections against default legal judgments and in some circumstances prohibits repossession, foreclosure, and eviction without a court order. The MLA provides servicemembers and certain dependents with legal protections for many types of consumer credit and loans. It also prohibits lenders from requiring servicemembers to create military allotments to get a loan. And, both the SCRA and MLA provide interest rate benefits: the SCRA entitles you to reduce the interest rate to 6% on certain pre-service loans, and the MLA means that you can’t be charged more than 36% for many loans you take out during your service. The MLA also prohibits lenders from requiring servicemembers to waive certain consumer rights.
Be aware of an increase in coronavirus-related scams that target consumers who are afraid, confused, or financially impacted by the pandemic. As a servicemember, if you’re concerned about scams, you can take the proactive step of placing an Active Duty Alert on your credit report. This alert lets a business know that you're probably out of the country, and the business is then required to take reasonable steps to verify your identity before issuing credit in your name.
Even though the VA has adjusted its operations during the COVID-19 outbreak, benefits and services for servicemembers, veterans, their families, and survivors will continue to be provided. However, there are some changes being made to existing programs in light of the challenges presented by COVID-19.
For the safety and security of veterans, especially those with underlying health conditions, the VA is changing how it administers and processes veteran benefits. Regional offices continue to operate but will be closed to the public for in-person services. However, the agency is .
GI Bill benefits
A enables the VA to continue providing students with full GI Bill benefits, even as their academic programs move online. It permits the GI Bill program to continue paying benefits, including monthly housing allowances and living stipends, at existing rates for full-time students rather than reverting to lower rates for distance learning. The benefits for students already taking online classes remains unchanged.
During these challenging times, servicemembers and military families are continuing to make important financial decisions like buying homes and cars, using credit, and paying for college and everyday purchases. It can be easy – even tempting – to spend money more freely when you have extra time on your hands, but consider using this time instead to strengthen your financial skills and well-being.
These online educational resources can help you improve your money management skills, navigate purchases, and make more informed decisions about your everyday money choices:
- CFPB tools and resources – get answers to your financial questions and find step-by-step guides and resources on a variety of key financial topics, including mortgages, auto loans, credit and savings. You can also use our resources to help you navigate the military financial lifecycle.
- – a cutting edge graphic novel where you can choose your own financial adventure.
- – Military OneSource offers five online courses to help teach you the fundamentals of money management.
- – a free resource also provided by Military OneSource with e-books and audiobooks on a range of topics.
Staying informed, engaged and proactive is the best way for you and your finances to weather this crisis and maintain your financial health during the pandemic. If you have a problem with a financial product or service, try reaching out to the company first. Companies can usually answer questions unique to your situation and more specific to the products and services they offer.
We can also help you connect with the company if you have a complaint. Submitting a complaint and tracking your status is simple and secure. Curious how the complaint process works? Follow the steps your complaint goes through to help you get a response about your issue.
Find more information regarding COVID-19 from CFPB
We’re working to continuously update information for consumers during this rapidly evolving situation.
We will publish all COVID-19-related information and blogs to our resource page. Information should be considered accurate as of the blog publish date.