Navy Federal Credit Union auto loans review: Available only to military and their families

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In a Nutshell

Navy Federal auto loans come with competitive loan rates, interest rate discounts for military members and flexible repayment terms. But to reap these benefits, you must be eligible to become a member of Navy Federal Credit Union.
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Pros Cons
Competitive interest rates and rate discounts for military members Must be eligible active-duty or retired military member, veteran or immediate family to become a Navy Federal member and apply for a loan
Preapproval good for 60 days Limited auto loan options
Flexible loan terms including 100% financing and term lengths of up to 96 months for new cars  

What you need to know about Navy Federal auto loans

Here are some notable features of Navy Federal Credit Union auto loans.

Limited auto loan options

When it comes to cars and trucks, Navy Federal offers new, used and auto refinance loans. If you’re planning to buy a motorcycle, boat or other leisure vehicle, Navy Federal offers loans for those, too.

But if you want a lease-buyout loan or plan to buy a used car from a private seller, you’ll need to apply for a loan from a different lender.

Limited eligibility for Navy Federal auto loans

To get a Navy Federal Credit Union auto loan, you must be a member. Membership eligibility, as with all credit unions, is limited to a specific group of people. To be eligible to join Navy Federal Credit Union, you must be one of the following:

  • A member of the military — Army, Marine Corps, Navy, Air Force, Coast Guard or Air National Guard — on active duty
  • A retired service member
  • A veteran
  • An individual in the Delayed Entry Program
  • An ROTC participant
  • A reservist
  • A Department of Defense officer candidate
  • A Department of Defense civilian employee
  • A Department of Defense contractor assigned to government installations
  • A Department of Defense civilian retiree
  • A U.S. government employee assigned to DoD installations

Immediate family members of somebody listed above, including parents, spouses, siblings, grandparents, children, grandchildren and other household members, can also join Navy Federal. 

Competitive auto loan rates and rate discounts

Navy Federal offers competitive interest rates on auto loans, and active duty and retired military members may qualify for an interest rate discount. To score the rate discount, you must have direct deposit and contact the credit union by phone or visit a branch.

Rates are lowest for new-vehicle loans, but Navy Federal also offers low rates on late-model used-car loans. Navy Federal considers cars with a certain number of miles and with a model year of 2019 to 2021 to be late-model vehicles. Navy Federal’s rates on older used vehicles or those with more than 30,000 miles are similar to what some other banks offer.

A closer look at Navy Federal auto loans

Here are some other important details about Navy Federal Credit Union auto loans.

  • Navy Federal offers 100% financing, which means you might not need to make a down payment. This makes buying a vehicle easier if you don’t have cash on hand, but it puts you at risk of becoming upside down on your car loan.
  • You can choose a loan term of up to 96 months for new vehicles and 72 months for used-car loans. Keep in mind that a longer loan term will stretch out your payments and may make your monthly payments more affordable, but you’ll pay more in interest over the length of the loan.
  • Navy Federal offers the ability to apply for preapproval. Your preapproval and interest rates are good for 60 days after the check is issued, giving you ample time to shop for a car.
  • Navy Federal offers several car-buying programs. The Auto Buying program offers savings on cars purchased through its dealer network, and the Overseas Auto Buying program provides vehicle delivery overseas or in the U.S.
  • Navy Federal also offers guaranteed asset protection insurance for a flat rate of $299, which can be financed as part of your auto loan. If your car is totaled or stolen and you owe more on your auto loan than your car’s current market value, gap insurance can help cover the difference.

Is a Navy Federal auto loan the right fit for you?

A Navy Federal Credit Union auto loan may be a good fit if you’re a member or qualify to become a member, and you want the ability to apply for preapproval and shop with a check in hand.

A Navy Federal auto loan could also be ideal if you want flexible loan terms, like a longer loan term or a low down payment — or no down payment at all. Just remember that opting for a shorter loan term and making a down payment can help prevent you from owing more on your car than it’s worth. A down payment might also increase your odds of loan approval.

Apart from membership, Navy Federal Credit Union doesn’t specify any requirements, like minimum credit scores. It does note that you can still get a loan if you have limited credit history — though you may need a co-applicant, depending on the amount you want to borrow.

If you have excellent credit and plan to finance a new car for no more than 36 months, Navy Federal may offer you a low starting annual percentage rate. But if you need a longer loan term, you might be able to qualify for a lower interest rate with another lender. Be sure to shop around and compare your loan options.

How to apply for a loan from Navy Federal Credit Union

Credit union members interested in applying for a Navy Federal auto loan can apply for preapproval online. The application process is quick, and you can receive a decision within five minutes via email or text.

To apply for preapproval, you’ll want to have some info handy, including your contact information, housing, employment and income information, details on your trade-in (if you have one), and your desired loan amount and loan term. If you have a co-applicant, you’ll need to enter their information as well. For a refinance loan, you’ll also need to provide the car’s VIN and exact mileage along with your current lender’s information and loan payoff amount.

If you’re preapproved, you’ll be able to see the loan amount and interest rate Navy Federal is willing to offer you. You can then pick up your check at a Navy Federal Credit Union branch or have it mailed to you.

Before you apply for an auto loan with Navy Federal, it’s a good idea to check your credit and compare loan offers. Understanding your credit will help set expectations, including whether you’ll qualify for Navy Federal’s best rates. Shopping around can help you find the best loan rate and terms for your needs. Learn more about how to get a car loan.

Auto loan alternatives to consider

If you aren’t sure whether a Navy Federal auto loan is right for you, here are two other options.

About the author: Christy Rakoczy Bieber is a full-time personal finance and legal writer. She is a graduate of UCLA School of Law and the University of Rochester. Christy was previously a college teacher… Read more.