Student Loan Advice for Troops and Their Families

With many National Guard and Ready Reserves being called to active duty and U.S. troops being deployed or reassigned to other duty stations, student loan repayment may be one of the issues on the minds of soldiers and their families.

To avoid becoming delinquent on your student loans, consider the following tips:

  • Make sure you have records on all your student loans. Review your records, contact your school(s), and locate all your student loans.
  • Review relief provisions for your federal student loans.
  • Provide your loan holder with authorization to correspond with your family or representative while you’re away from home.
  • If you are required to continue making payments, consider electronic payment options, such as online payments or electronic debit.
    • Electronic debit is a service that allows your bank to automatically deduct your monthly loan payments from your checking or saving account and forward it to your loan holder for processing.
    • Some loan holders even offer interest rate discounts if you use electronic debit!
  • Will this deployment impact your family budget? Calculate a budget to determine how you will manage your money during this time.
  • Explore reduced interest rates, as well as other options to avoid legal problems and save money under the Servicemembers Civil Relief Act. Reduced interest rates previously applied to mortgage payments and consumer debt. With the reauthorization of the Higher Education Act on August 14, 2008, service members may request the rate on certain Federal Family Education Loan Programs loans be reduced to 6 percent.
  • Military borrower whose service includes August 14, 2008, or begins on or after that date, may be eligible for zero interest accrual. If you have Federal Family Education Loan Programs loans, you must consolidate into the Federal Direct Loan Program to receive this benefit. Contact your loan holder for more information. You may be qualified if you are:
    • serving on active duty during a war or other military operation or national emergency,
    • performing qualifying National Guard duty during a war or other military operation or national emergency; or
    • serving in an area of hostilities in which service qualifies for special pay.

Federal Student Loan Relief

Student loan relief provisions apply to borrowers who:

  • are members of the National Guard or Ready Reserves who are called to active duty for more than 30 days or
  • are active members of the Armed Forces who are reassigned to other duty stations for more than 30 days.

If you have loans in an in-school, grace period, or in-school deferment status, you may have that loan status extended for up to three years during your active duty service. If you have defaulted student loans, your loan holder will cease collection activities during your active duty service.

You may be eligible for an active duty or military service deferment. To qualify, you must be serving on active duty or performing National Guard duty during a war, military operation, or national emergency (or be in the 180-day period following your demobilization date). Your loan holder must grant a deferment based on your request or a request from a family member or other reliable source. They may accept an oral request. Read more about deferments.

Contact your loan holder for more information. Also, you may want to inquire if your military unit has someone designated to assist you with student loan questions.

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