Military benefits for investing?

10 Replies

Here’s a strategy that I haven’t seen many (if anyone) talk about and I’m curious to see how the BP family would do it.

Below are the benefits (I know of) that I can use:

Please let me know if I’m missing anything.

4% interest on credit cards

No annual fee on AMEX charge cards

USAA and NavyFed banking

VA home loan

6% max interest on any other lines of credit (home depot, etc.)

10% Military discount from Home Depot and Lowe’s

How would you use these programs to benefit your REI journey?

@David Pere

I think these 'benefits' are highly marginal at their absolute best.

4% interest credit cards - not sure what this means? Plenty of high interest cards for military members

no annual fee on Amex - I guess it's a benefit?

USAA - average bank when it was good, below average now

VA home loan - more of a trap than a benefit for investors

6% Max interest on lines of credit - false

10% discount at lowes - this is the best one! 


To me this thread just makes it obvious how easily the country will send it's poor to war and how little it cares about them afterwards. 

@Alexander Felice I guess I should’ve added a little bit more context. But I do appreciate the response. When I say 4% interest on credit cards I was thinking it from a cash advance point of view for a down payment.

Per the servicemembers civil relief act any lines of credit that I had before entering the military, including credit cards, are capped at 6% interest by law. granted, not a lot of people use this.

I will agree with you that the VA loan has been somewhat of a trap for me. I can refinance out of it anytime I want and use it on a four unit place and house hack though.

Personally, I am just a working stiff looking for creative ideas about how to use some of these benefits to my advantage.

@Alexander Felice

The benefits are actually borderline obnoxious, just not explained very well by the OP, or perhaps he wasn't aware of some of the ways to take advantage of the situation.  Let me try to break it down a little better.

4% interest on credit cards: This is part of the Servicemembers Relief Act or SCRA. By law any PRE-existing debt obtained prior to joining the military is capped at 6% interest rate. This applies to any debt. So if your mortgage was at 7% interest rate and you joined the military, you simply call your mortgage company and they will be forced to lower your interest rate to 6%. This applies for mortgages, credit card debt, student loans, car loans, you name it. Some credit card companies go one step further for our vets and offer 4% interest on PRE-existing debt, while others yet (I think it's Citibank and Barclays issued cards) offer an eye popping 0% interest on pre-existing credit card debt. New charges you make AFTER you join will still be at the regular APR rate, however if you plan on joining the military soon and plan accordingly, you can turn that 0% APR into a free loan for up to 20 years while you serve.


No annual fee on AMEX charge cards:  This is done by both Chase and AMEX issued cards (AMEX also applies this to their business credit cards) as they have taken the MLA (military lending act) requirements and have gone above and beyond.  They essentially remove all fees from their cards, to include late fees, foreign transaction, annual fees, etc including on cards opened AFTER joining the military (several other CC companies offer the same thing but only if you open the account prior to joining the military).  While this doesn't sound impressive, it actually is.  There are 'premium' credit cards that offer some benefits, in exchange for a ridiculously high annual fee.  The AMEX Platinum card has a massive $550 annual fee, but is completely free for military.  The AMEX Platinum offers $200 in free travel reimbursement per year, $200 worth of UBER credits per year (I use them on UBER eats), a $100 in hotel credit, and $100 in Saks Fifth Avenue credit per year.  (I use all of the credits to buy gift cards online and then use them as I please, the Saks gift cards I resell online at 85% face value since I have no interest in buying a $400 T-Shirt).  Essentially you get multiple hundreds of dollars worth of stuff completely free.  There are many different credit cards like this and if you collect them all it can turn into a fantastic annual benefit.  I currently get roughly $4,000 worth of airline gift cards for free every single year and have an email box stuffed full of virtual gift card codes that never expire.  You can upgrade cards like the green and gold card to additional platinum cards so currently I have 6 AMEX Platinum cards, which translates into $1200 worth of free UBER eats food every year, 1200 travel credit and $510 in cash after I liquidate 600 bucks worth of Saks gift cards online.  All told I get probably 12k worth of free stuff from my cards every year.  Several of these cards I've never actually opened the card and taken it out of the envelope they were mailed to me in, yet I still get the benefits of 'owning' one of these cards.


USAA and NavyFed banking: Nice in the fact that they are very service oriented. They are very easy to work with during deployments or other situations where you don't have the luxury of walking into your local Wells Fargo bank and talking to someone. They will lower your credit card APR every time you PCS for 1 year after you move, which in the military can be very often. They also both offer a real estate referral network where if you are either buying or selling a home, you can use one of their agents and USAA will write you a check after you close on the home. The last house I bought on the MLS was for 215k, and a week after I closed USAA wrote me a check for roughly 1k because I used an agent that they recommended.



VA home loan - more of a trap than a benefit for investors: I'm not sure how the only 100% down payment assistance program in the nation (currently) is a trap? Since it is backed by the government, interest rates are about the best you will likely find. While it does have a funding fee, this is easily offset by the fact that you will never pay PMI. I would 10x rather wrap a funding fee into the loan price than pay PMI for the next 30 years with an FHA loan. Additionally the funding fee is waived if you are receiving at least a 10% service disability (which is extremely easy to get).

6% Max interest on lines of credit - false:  It's actually semi true.  The 6% is part of the SCRA benefits and only applies to loans obtained prior to joining the military.  If you are in the guard or reserve, this also applies to any loan obtained prior to being drawn up to full time duty on Title X orders during a deployment etc.



10% discount at Lowes and Home Depot - this is the best one!  Of all of the options this is actually my least favorite perk listed.  The discount only applies to product, and not other options such as delivery and installation services.  In addition the discount does not stack with any other specials the store may be running during various holidays or sales specials.  

Not mentioned are other items such as the GI Bill, which now pays a housing allowance in addition to paying for the school itself.  If you live in CA or other expensive areas, the GI bill could pay you as much as $3000-4000 per month in cash to pay for rent for a few years while you knock out your schooling.


Retirement: With the new retirement system that rolled out, members will only receive 40% of their base salary per year in benefits if they retire at 20 years (as opposed to the previous 50%). However all members in this system will automatically get a 1% contribution to their TSP retirement account, and a matching contribution up to 5%. This is given to everyone and not just those that stick around long enough to retire which means you can have a decent 401k style nest egg set up due to the 5% match if you decide to get out after your first tour.

Downpayment Assistance: Many states will offer additional downpayment assistance programs for service members which can be used in conjunction with the VA loan. Some states offer a 5-6% assistance which can save many thousands of dollars off the purchase price.



Originally posted by @Christopher Lane :

Here’s a strategy that I haven’t seen many (if anyone) talk about and I’m curious to see how the BP family would do it.

Below are the benefits (I know of) that I can use:

Please let me know if I’m missing anything.

4% interest on credit cards

No annual fee on AMEX charge cards

USAA and NavyFed banking

VA home loan

6% max interest on any other lines of credit (home depot, etc.)

10% Military discount from Home Depot and Lowe’s

How would you use these programs to benefit your REI journey?

Definitely worth clarifying that the 4% and 6% claims for the SMCRA are only applicable to pre-existing debts when joining the military.

USAA is alright, but I only use them for checking and car insurance at this point. They won't cover investment properties for home insurance so I moved elsewhere. Navy Federal isn't too bad, and I like their business account(s)!

Military discount(s) are great!

The VA loan isn't a trap @Alexander Felice ...People/consumerism is! The VA loan can be great (if you buy right)...but people definitely overleverage on non-investment worthy properties...definitely need to be careful, but it is a good way to get started...better than not getting started at least...IF YOU BUY AS AN INVESTMENT!!! NOT A HOME!!!

@Ben Zimmerman Thank you so much for being able to help me understand these benefits a lot better. You definitely were able to speak to these more eloquently than I could. Thank you very much.

@Ben Zimmerman i've got a following question, since you seem to be the subject matter expert, I figured I would get your input as well. Like every good Marine, I have a TSP. I'm curious about pulling it all out and converting it to a self-directed IRA, or self-directed something so that way I can use it to purchase my first rental property. Do you have any idea how I would go about doing that?

Let's not forget one of the best and most underutilized VA loan programs. The VA IRRRL refinance loan. My wife and I bought 4 homes in under 3 year's by using this strategy with no down payment and no funding fees on 2 because I'm 100%.

House #1 bought it with numbers that would cash flow as a rental with my VA eligibility. Moved in house.

After 1 year did a VA IRRRL refinance loan and reduced our rate.

House #2 bought it with numbers that would cash flow as a rental with my VA eligibility. Moved in and lived there 1year.

After wife PCS

House #3 bought it with numbers that would cash flow as a rental with my wife's eligibility. Moved in and lived in about 66 days.

After 30 days did a VA IRRRL refinance loan and reduced our rate.

House #4 the house I still live in bought with my wife's eligibility.  We had to write a letter stating why we wanted to buy another house after only being in house #3 for only a short time. We simply told the truth that it would cut 24 miles each day from my wife's commute.

* the great thing about the VA IRRRL refinance loan is you only have to certify that you lived in the house. This releases you from the one year occupancy requirement. *

I think that's a pretty good military benefit buying 4 house,  3 becoming rentals in under 3 years with no down payments. 

Home Depot and Lowe's discount.  

Although it is policy that you are not supposed to receive sale items and your military discount it's not a 100% no.  I have gotten both by simply asking.  I actually did this today when buying appliances for a new rental. All the kitchen appliances were on sale and I simply ask the clerk if I can still get the military discount.  He said let's see if it will take it.  Typed it in and boom $238.73 discount. Oh an as an extra bonus I always use my 5% back credit card when shopping at Home Depot and Lowe's.  

USAA rental property insurance. 

Not sure who said above that USAA doesn't do rental property insurance but that's wrong.  We currently have 5 of our rentals, 1 primary and 2 secondary homes with USAA and the rest with State Farm. I did see someone in another thread on BP say that USAA will only allow 7 rental properties but I don't know if that's true.  Maybe I will call and find out.

SCRA benefits:

Don't forget if you deploy you can terminate any lease.  I used it to terminate a lease on a truck.  The finance company tried to not let me out of the lease but one phone call from legal and they apologized for being dumb and even sent me a prorated check for part of the month. They also paid to pick the truck up as I was down range and could not deliver it.  

Food and other service related businesses: 

Don't forget a lot of restaurants and other service companies give a 10% discount.  When I meet with another investor I take them to lunch and utilize my discount.  Most restaurants discount the entire ticket.  If you live in a military community there's more available discounts.  Here's a short list where I get discounts:

Carpet cleaning 

Pest control 

Plummer 

Electrician 

Roofing company 

Air conditioning and heating company 

House cleaner 

Pool service 

Lawn care 

Flooring and carpet store 

Fencing company 

And a few handyman companies 

There's a bunch more but not really investor related so I won't list them. 

@Clifford, sorry for the confusion, I meant that USAA doesn't cover commercial investment properties, so when I bought my 10-unit I transferred everything under one hat...but I will say that State Farm was significantly cheaper for me.