Navy Federal vs. American Express: Which Personal Loan Is Right for You?

Navy Federal and American Express are well-known, top-rated institutions that provide financial services. Navy Federal is a not-for-profit, member-owned organization that caters to active and retired personnel from all branches of the U.S. military and their families, whereas American Express is a multinational corporation that ranks fourth globally in terms of payment card services.

Each of these lenders has unique perks that may be highly attractive to consumers. To help you decide which lender is the perfect fit for your needs, MoneyGeek gathered the latest data and performed comparisons on several important criteria.

Use this up-to-date information to check if you meet the eligibility requirements and to gain a deeper understanding of what each lender has to offer.

MoneyGeek provided a comparative analysis of Navy Federal vs. American Express to help you decide which of these lenders is better suited for your financial needs and goals. We’ve outlined the key features of each lender and picked out a winner on several key criteria that we think matter most when selecting a personal loan.

Based on our analysis, Navy Federal is the better option for eligible borrowers who value flexible loan amounts and repayment terms. But if having low APRs is your main consideration, American Express is the ideal choice, particularly for borrowers with excellent credit.

The APR, or annual percentage rate, is the percentage of your personal loan in interest that you must pay back each year. This rate tends to vary greatly by lender. It’s essential to secure a loan with the lowest possible interest rate if you want to keep costs at a minimum.

Whereas Navy Federal charges APRs between 7.49% and 18%, American Express has a wider range of APRs from 4.93% to 19.97%.

Both lenders have creditworthiness-based APRs, which means that the lowest rates are generally reserved for individuals with strong credit. Borrowers with excellent credit profiles can expect lower APRs from American Express than from Navy Federal. In contrast, borrowers with less-than-stellar credit will prefer Navy Federal’s slightly lower maximum APR.

The great news for NFCU members is that its personal loans don’t have a credit score requirement. This suggests that even applicants with bad credit may be approved. In contrast, eligible American Express cardholders who wish to secure an American Express personal loan need to have a credit score of 660 or above to qualify.

A credit score is issued by major credit bureaus, namely, Equifax, Experian and TransUnion, using information from your credit report. It ranges from 300 to 850, and this score is used by creditors to measure the level of risk that they’re taking by giving you a loan. Your assessed creditworthiness not only affects your chances of securing a loan but also has an impact on the APRs, loan amounts and repayment terms that you’ll qualify for.

There are many factors that affect your credit score, including your credit and payment history and outstanding balances on your accounts.

Navy Federal offers personal loans ranging from $250 to $50,000, while American Express offers loans between $3,500 and $40,000.

Keep in mind that the optimal loan amount for you will depend on your intended use of the funds, and this may differ from the actual amount that your lender offers you.

Having said that, a loan with a higher minimum amount and lower maximum cap might not be ideal for certain borrowers who are looking for a smaller or larger loan amount. For instance, individuals who are looking to build or rebuild their credit may prefer to borrow smaller amounts with more manageable monthly payments. Likewise, a loan with a lower maximum cap may not be enough to cover large expenses.

Navy Federal gives its consumers greater flexibility in terms of repayment options. Whereas American Express only offers terms from 24 to 84 months, Navy Federal gives more generous options from 12 to 180 months, which may accommodate the preferences and needs of most borrowers.

Your loan’s repayment term is the amount of time you agree to pay back your loan. Given the same loan amount, a loan with a lengthier repayment term generally has lower monthly payments and higher APRs compared to a loan with a shorter repayment term. Therefore, the ideal scenario is for you to secure a loan that has the shortest repayment with monthly installments that you can easily afford.

When determining your repayment term, lenders will typically consider your credit score, debt-to-income ratio and income.

Navy Federal provides next-day funding in most cases. In contrast, American Express offers same-day funding after you submit your signed personal loan agreement. This difference might be substantial for individuals that need funds urgently.

Both lenders provide their consumers the option of a fully digital loan application process, which speeds up the processing and verification time compared to applying in person or via phone. This allows borrowers to have quicker access to loan funds.

To further facilitate your application, we recommend that you prepare the necessary documents beforehand, such as proof of your identification, address and income.

Navy Federal outshines American Express on most of the criteria that MoneyGeek used in this comparative analysis. It offers a wider range of loan amounts and lacks a credit score requirement.

Note that there are membership requirements for both lenders. Whereas Navy Federal only provides personal loans to NFCU members, American Express grants personal loans only to eligible American Express cardholders.

Based on our analysis, Navy Federal is the better option for:

• Military personnel and their family members who are still building or rebuilding their credit
• NFCU members who have urgent financial needs and prefer fast funding
• NFCU members who want greater flexibility in loan amounts and repayment terms

But American Express is better suited for:

• American Express cardholders who have excellent credit and are looking for low APRs

Keep in mind that these recommendations are not a substitute for your own assessment of your needs and circumstances. Ultimately, you are in the best position to decide how important a factor is given your financial situation.

For more information on these lenders, read MoneyGeek’s Navy Federal personal loan review and American Express personal loan review.

There are many benefits and risks associated with personal loans. To help you understand these, MoneyGeek provided answers to the most common questions about personal loan lenders below.