How to Pay Off Student Loans for Veterans

About 18 million Americans, or about 7% of the adult population, have served in the armed forces. This group of veterans has done more for our country than merely hanging up their uniforms. Many of them continue their education with the help of the G.I. Bill and other veteran-specific educational incentives.

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However, once students enter college or soon after graduation, they face new issues, including how to repay their student loan debt.

Veterans are fortunate in that they have access to various loan forgiveness and repayment schemes. Veterans can seek aid paying off their student loans through initiatives like the Public Service Loan Forgiveness (PSLF) and the Department of Veterans Affairs Education Debt Reduction Program (EDRP).

7 Loan Repayment and Forgiveness Programs for Veterans Air Force Judge Advocate General's Corps

JD-holding officers interested in joining the Air Force will find this training very beneficial. The Air Force will forgive up to $65,000 in student loan debt for those who qualify for the program.

Paying Back Student Loans in the Army

Those highly qualified who enter the Army service may be eligible for the Army College Loan Repayment Program. For up to three years, the Army will pay back either $1,500 or 33.3% of the outstanding principal balance, whichever is greater. The highest possible prize is $65,000.

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Up to $40,000 per year is available for student loan payback for active-duty medical personnel and new accessions to the Navy, less around 25% for taxes.

Loan Repayment Assistance for Members of the National Guard

A maximum of $7,500 per year is available to those who enlist for a minimum of six years of service. You could receive up to $50,000 in debt repayment assistance over six years. However, only loans from the federal government qualify.

Repayment Waiver for People Who Have Served the Public

PSLF is available to both veterans and current service members. The loan is forgiven when a borrower works for a qualifying organization or government agency for ten years and makes 120 qualifying payments against their federal loan.

The path to PSLF used to be very challenging for military veterans. The Government Accountability Office reported that 94% of Defense Department program applicants were turned down.

Military Personnel Actively Serving In The Armed Forces.

Due to this, the program has undergone several improvements that are helpful to both veterans and active-duty service members. If you were in deferment or forbearance on your student loans during active service, the Department of Education would still include that time toward PSLF.

The Department of Education will allow you to become eligible for PSLF if you consolidate your debt using a Direct Consolidation Loan by October 31, 2022, even if you have federal loans that aren't eligible for PSLF (such as FFEL loans) or had periods of deferment or forbearance that weren't counted.

Dismissal Due to Total and Permanent Disability (TPDD)

Suppose a veteran of the United States military has a service-connected disability that prevents them from ever working again. In that case, they may be eligible to have all their federal student debts forgiven. Military veterans may be eligible for a streamlined TPDD, making the process simpler.

The VA periodically transmits information to Nelnet — the loan servicer that handles TPDD applications — concerning veterans that may be eligible for loan discharge. Nelnet will notify you through a letter that you are eligible for release and what steps you need to follow if you have a 100% debilitating service-related disability or are entirely handicapped based on your specific unemployability rating.

Even if the VA has yet to contact you, you can still apply for TPDD if you believe you meet the requirements.

VA Education Debt Reduction Program

Veterans who chose employment in healthcare with the Veterans Health Administration are eligible to receive up to $200,000 in loan repayment aid under the Educational Loan Repayment Program (EDRP) (VHA). Some examples of jobs that qualify for the EDRP are:

Taxes will not be taken out of the EDRP money you get, and they can be used to pay back any type of student loan, federal or private. The money you've already received can be paid, too, if you leave the VHA before the five-year limit has been reached.

Loan Repayment for College

Veterans may be eligible for special assistance in managing the financial burden of student loan debt. The Public Service Loan Forgiveness (PSLF) and the Federal Direct Consolidation Loan programs can help you pay down your student loans. The VA or your local VA institution can help you determine your eligibility and guide you through the application process if you need clarification.