“student Loans And Military Service: Benefits And Repayment Programs”

“student Loans And Military Service: Benefits And Repayment Programs” – The average student loan debt in 2019 was $1.6 trillion and it continues to grow. However, if you are currently serving or have served in the military, you will receive financial assistance for college education and student loans. These loan options can come from the federal government and nonprofit organizations.

Remember that military student loan options are not only available to active duty personnel and their families, but veterans as well as prospective military personnel are eligible. All branches of the military can benefit including Air Force, Army, Coast Guard, Marines, Navy and Space Force.

“student Loans And Military Service: Benefits And Repayment Programs”

The different types of military student loans and repayment options have varying requirements, so be sure and choose the one that’s right for you and your type of service. These range from military student loan forgiveness programs to programs that allow you to delay paying back student loans.

Scholarships For Active Duty Military Members And Their Dependents

The Attorney General is also pushing for the write-off of all student debt accumulated by disabled veterans, as many are unaware of and do not use the program.

To help reduce overall student loan debt, experts recommend that borrowers search for the best interest rates and compare private student loans and federal student loan rates. 124 of them

‘Just when you think we’ve hit rock bottom when it comes to the total mismanagement of Public Service Debt Relief, you’ll see reports like this’

Nearly 3 million people are employed by the Department of Defense, many of them performing a quintessential form of public service: Serving in the Armed Forces. But as of January last year, only 124 military members had been paid student loans under the Public Service Debt Relief program.

Only 124 Military Members Have Received Public Service Loan Forgiveness

That equates to about 9% of military debt relief applications under the program — and that’s even higher than the nation’s overall success rate of 1%.

That’s according to a report released on Thursday by the Government Accountability Office, which also found that 1,410 members of the military had applied for debt forgiveness under the program.

Public Service Loan forgiveness write off the remaining balance of the Direct Loan after the borrower has made 120 qualifying monthly payments under the qualified repayment plan while working full time for a public service employers listed in the program.

“Furthermore, 11% of the 176,906 active-duty service members who have loans that qualify for forgiveness or loans that can be consolidated to qualify have filled out paperwork.”

What Happens If I Get Deployed While In School?

To qualify for forgiveness, borrowers need to be in the right type of student loan repayment program, not all of them qualify; they need to do the right kind of community service work, some nonprofit work doesn’t qualify; they need monthly payments for 10 years; and they need the right type of federal student loan.

Of the discharged service members, 34 are in the Army, 37 in the Navy, 42 in the Air Force and 11 in the Marines. Overall, only 287 borrowers employed by the Department of Defense had their debt forgiven under the program, out of 5,180 who applied – a rejection rate of 94%.

“Just when you think we’ve bottomed out when it comes to utter mismanagement,” said Seth Frotman, executive director of the Student Borrower Protection Center, a borrower advocacy organization. of the Public Service Loan Forgiveness program, you’ll see reports like these. group.

“Finally receiving confirmation that only 124 service members were pardoned more than a decade after this program was created is truly a national disgrace.”

How Nurses Can Get Their Student Loans Forgiven

Furthermore, the GAO found that only 11% of the 176,906 active-duty service members had loans that qualified for forgiveness or loans that could be consolidated to qualify for forgiveness. Fill out paperwork to put them on the right track for relief.

The GAO’s findings are the latest evidence of the challenges borrowers face when accessing PSLF, an initiative that allows people working for the government and at a number of nonprofit organizations to access pay off their federal student loans after 10 years of payments and public service work.

The show, which launched in 2007, struggled in its early trials to deliver on its promise. After 10 years of existence, when the first group of borrowers qualified for loan disbursement under the program in 2017, 99% of applications were rejected.

Some close followers of the program had hoped that in the years following the initial pool of applicants, the proportion of those approved for benefits under the PSLF would increase.

No, You’re Not Going To Be Drafted Into The Military Just Because You Applied For Federal Student Loans

One of the main reasons for this prognosis: during the first few years of the program, the type of federal student loans most borrowers issued were not eligible for forgiveness under the PSLF unless the borrower consolidate their debt.

“The first group of borrowers that were eligible for loan disbursement under the program in 2017, 99% of applications were denied.”

Borrowers who have taken out student loans from 2010 onwards and are therefore the first to qualify for PSLF loan forgiveness in 2020, are only granted the loan category that is eligible for the program. .

For Frotman, an improvement in numbers is not an excuse for the losses experienced by borrowers. As a student loan inspector at the Consumer Financial Protection Bureau, he warned of potential challenges facing the PSLF before the first cohort was eligible for forgiveness.

Student Loans Relief Explainer

In addition, the GAO report, released on Thursday, indicates that many of the obstacles that applicants in the first group face when accessing forgiveness persist. The Department of Education did not immediately respond to a request for comment on the report.

Responding to the GAO, Mark Brown, a Betsy DeVos appointee who served as executive director of Federal Student Aid under the Department of Education before resigning in March, said the agency concurs with the proposals. of the GAO. He also highlighted steps the agency has taken to simplify the PSLF, including creating a database that borrowers can use to see if they work for an eligible employer. .

During the campaign, President Joe Biden vowed to “make public servants debt-free,” and supporters pushed the administration to do so.

While the idea and promise of Public Service Loan forgiveness is relatively simple — work for 10 years in public service, pay off your student loans during that period, and pay the remaining balance — the reality of getting a loan can be complicated.

Am I Eligible For Public Service Loan Forgiveness?

Only Direct Loans are eligible for PSLF, but borrowers with the Federal Education Loan for Families can consolidate their debt into a Direct Loan to qualify for relief. For years, borrowers and advocates have said that student loan companies – companies paid by the government to manage the student loan repayment process – do not provide give the borrower enough or appropriate information to take advantage of this option.

That means that in some cases, borrowers who are working in public service jobs and paying off their student debt, assuming they will qualify for relief, only to discovered after several years of payments that those efforts were not counted towards the program.

In response to the GAO report, Brown hinted that several Defense Department employees who had asked for forgiveness but were denied were in this situation.

80% of rejected applicants with no Direct Loan, he wrote, have been repaid for at least 10 years, adding that “although some of these borrowers may have been repaid in the program FFEL during that time period. .”

Programs For Military Members & Spouses

It’s a “complete indictment of the larger program,” said Frotman, that borrowers explicitly eligible for Public Service Debt Relief are struggling to access the promised relief.

“It’s clear that if you can’t properly deal with people who are actually serving our country while active, then there’s no doubt that you’re completely incompetent,” he said. when it comes to others.

“’If you can’t properly understand the people who are actually serving our country while in the army, then there’s no doubt you’re completely incompetent when it comes to others.’ “

The GAO recommends that the Department of Education take steps to provide the Department of Defense with more information about eligible employees and who have taken steps to pursue the program. The agency also asked the Department of Defense to provide more information to its staff about the PSLF.

Education & Training

But Frotman and other supporters have called on the Biden administration to go further. A coalition of 97 organizations sent a letter to Education Secretary Miguel Cardona earlier this week calling on the department to cancel the student debt of people who have worked in public service for at least 10 years.

For those currently serving or have served in the military, Frotman said the government should leverage its data on federal student loan holders and those who have served to ensure that that time of service counts toward pardon.

Frotman, who before CFPB’s student loan inspector was a senior advisor to Holly Petraeus, then assistant director of military affairs at the consumer office,

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