Allotment Loans for Government Employees: 6 Lenders Listed

Allotment loans for government employees are out there. These include Army Emergency Relief, Air Force Aid Society, BMG Money, Federal Employee Education & Assistance Fund, Kashable, P2P Military Loans, and PostalLending.com. We have what you need to know about allotment loans for government employees and details on available lenders.

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What to Know About Allotment Loans for Federal Employees

There are two different types of allotment loans for federal employees: discretionary and non-discretionary. A discretionary allotment loan is one in which you designate a certain amount of your paycheck to be automatically taken out and used for another purpose (think: a mortgage, retirement account, etc.). You can stop or start this allotment payment at any time. A non-discretionary allotment loan is similar in that a certain amount of your paycheck is automatically designated for another purpose; however, you won’t be able to start or stop the allotment whenever you want. Meaning, if you sign up for a non-discretionary allotment loan, a certain amount of your paycheck will go toward that loan until it’s paid off.

This type of loan is often called an “allotment loan,” but, in actuality, it’s an allotment plan between you and a lender. Allotment plans are easier for federal employees to qualify for — even if you have bad credit — since the lender is guaranteed payment as long as you’re employed by the federal government. The allotment payment will be divided between your paychecks; if you’re paid twice a month and you have a $200 allotment, $100 will be taken out of each paycheck. Keep in mind that if you quit or are fired from your federal job, you will still be required to repay the loan and you’ll need to notify the lender of your change in employment status.

Where to Get Allotment Loans for Government Employees

The following is the list of places that offer allotment loans for federal employees. Some lenders only work with employees in specific federal jobs, such as postal workers. We list the terms and requirements for each lender below.

Army Emergency Relief (AER)

Loan limit: None
Terms: Vary, depending on the individual loan
Rates: There is no APR on AER loans
Requirements: Must be active-duty military or a dependent, retired military, or widow/widower or child of a military member who died on active duty or while retired. Must provide paperwork proving the need for relief.
Credit check required? No
Apply

Air Force Aid Society (AFAS)

Loan limit: No limit for Standard Assistance loans; $1,000 limit on Falcon loans
Terms: The typical term for a Standard Assistance loan is 12 to 24 months; three to 12 months for a Falcon loan
Rates: There is no APR on AFAS loans
Requirements: Must be active-duty military or a dependent, Air Force Reservists or Air National Guard on active duty, or widow/widower or child of a military member who died on active duty or while retired. Must provide paperwork proving the need for relief.
Credit check required? No
Apply

BMG Money

Loan limit: $100 to $35,000
Terms: Vary, depending on the loan amount
Rates: 24 to 32% APR
Requirements: Must be at least 18, not declaring bankruptcy, not in the military, and a current federal government employee employed at least one year
Credit check required?: No
Apply

Federal Employee Education & Assistance Fund (FEEA)

Loan limit: $1,200
Terms: 10-month loan term maximum
Rates: There is no APR on FEEA loans
Requirements: Must be a current federal employee employed at least one year. Must also provide paperwork proving hardship or a copy of the bills for which you need assistance
Credit check required? Yes
Apply

Kashable

Loan limit: $500 to $20,000
Terms: Six- to 24-month loan terms
Rates: APR starts at 6%
Requirements: Must be a federal government employee
Credit check required? Yes
Apply

P2P Military Loans

Loan limit: $1,000 to $40,000
Terms: Vary, depending on the individual loan
Rates: APR ranges from 6 to 35.64%
Requirements: Must be an active-duty military member or dependent, retired military or dependent, or member of the Reserves or National Guard
Credit check required? Yes
Apply

In Summary

There are a number of allotment loans for federal employees. Certain lenders cater to a specific type of worker, such as military or postal employees. An allotment is taken directly from your paycheck, thereby reducing the risk to the lender. This means that if you have bad credit or no credit, you may still be able to qualify for an allotment loan. However, be aware that if the allotment loan is non-discretionary, you won’t be able to start or stop the allotment at any time — and if you lose your federal job, you’ll still be responsible for paying back the loan.

For more loan options, see our list of installment loans for federal employees, list of loans for federal employees with bad credit, and our article on what to do if you keep getting declined for loans.