Automatic Student Loan Interest Benefit for Veterans & Military
The U.S. Department of Education Grants Interest Rate Benefit to 47,000 Veterans and Service Members
A recent press release from the U.S. Department of Education grants an interest rate benefit to more than 47,000 current and former active duty service members. The Office of Federal Student Aid (FSA) has retroactively waived student loan interest rates for these veterans and military service members.
This was made possible by a data-matching agreement with the DoD that has improved access to a student loan interest waiver for these service members.
Interest Now Accrues and Benefit Applied Automatically
Before this announcement, service members who were deployed to areas that qualified them for imminent danger or hostile fire pay wouldn’t have any interest accrue on certain student loans that were first distributed on or after 10/01/2008. However, only a small number of those who were eligible even accessed this benefit, even if they qualified to do so.
Now, the DoD can easily identify the service members who qualify by matching the correct records. Once they do that, the benefit can be applied automatically.
“Brave men and women in uniform serving our country can now focus on doing their jobs and coming home safely, not filling out more paperwork to access their hard-earned benefits,” said FSA Chief Operating Officer Richard Cordray. “Federal Student Aid is grateful for our strong partnership with the Department of Defense, and we will seek to reduce red tape for service members wherever possible.”
Automatic Student Loan Discharges for Those with Total and Permanent Disability Ratings
In another August press release from the U.S. Department of Education, those with a total and permanent disability (TPD) will receive automatic student loan discharges, including veterans. These borrowers will be identified through an existing data match with the SSA. This will apply to over 323,000 borrowers.
These changes are going to be good for service members and veterans. Anytime a benefit can be applied automatically, it eliminates the need for extra paperwork on the service member’s part.
- Veterans’ Other-Than-Honorable Discharge Lawsuit
- Service-Disabled Veterans Insurance (S-DVI) Overview