Easing the Burden of Student Debt
If you are like many servicemembers, you may be carrying
the extra financial burden of repaying your old student
loans. If so, then the following article may hold
the answer to relieving that burden until you are
better able to begin repayment.
Many servicemembers are not aware that they qualify
for Student Loan deferment or forbearance.
A deferment means to postpone payments on your principal
loan balance. During a deferment, the interest on
Subsidized loans is covered by the government. Under
the Direct Unsubsidized and Unsubsidized Consolidation
Loans you are responsible for the interest that accrues
during the deferment period. If you have unsubsidized
loans, when you re-enter repayment at the end of the
deferment period, any unpaid interest capitalizes
(is added to the principal balance).
You may be eligible for several types of deferments;
however, most servicemembers only qualify for the
"In-School" deferment which requires you
to go back to school, and why not, you can use your
Bill or Tuition
Assistance to cover the cost while deferring your
student debt and completing your degree!
|Your GI Bill and Tuition Assistance
can get you huge
discounts on college tuition. Find
out how much money you can save while using
the benefits you've earned! More...
Forbearance: You must be in the process of repayment.
Forbearance is an arrangement to postpone or reduce
your monthly payment amount for a limited and specific
period during which you are charged interest.
If you are temporarily unable, but willing to repay
the loan(s), you may ask for a forbearance. The interest
will accrue during a forbearance and it is the your
responsibility. When you reenter repayment at the
end of the forbearance period, any unpaid interest
is added to the principal balance.
Unlike deferment most servicemembers qualify for forbearance.
You must apply and qualify for a forbearance and the
U.S. Department of Education must approve the request
in order for a forbearance to be in effect. The process
is quite simple.
The most common type of forbearance. that servicemembers
are eligible for is the "General Forbearance."
To qualify for general forbearance. you must meet
the following conditions:
You must be willing but unable to pay the scheduled
monthly payment because of a temporary financial hardship.
You must select either: temporarily stopping making
payments for a specific period of time; OR making
a smaller monthly payment (than previously scheduled)
for a specific period of time.
Contact a Federal Student Aid Customer Service Representative
for more information about how to manage your student
loan debt at 1-800-848-0979 or visit the Federal
Student Aid web page.
here if you want more information on how to use
your military benefits to return to school, finish
your degree, and defer your outstanding Student Loans.