More than 47,000 troops and vets will see some of their federal student loan debt erased. This news comes as the new policies announced by the US Department of Education on last Friday.
“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,” Federal Student Aid Chief Operating Officer Richard Cordray said in a statement announcing the change.
“We will seek to reduce red tape for service members wherever possible.”
Under previously passed legislation, any troops who deployed to overseas combat zones and hostile fire areas could have interest on many federal student loans waived. The rules include student loans first paid out after Oct. 1, 2008.
For some individuals, that extra interest can range from a few hundred to several thousand dollars. But until now, getting those additional fees waived required lengthy paperwork proving past military service and deployments.
Government officials said fewer than 5,000 service members and vets requested the interest fees be waived in recent years.
The new policy change shifts the burden from student veterans and troops to federal officials. Under a new data sharing agreement announced by the Departments of Defense and Education, federal processors can identify federal student loan borrowers who serve on active duty by matching records to DOD’s personnel files.
“As a result, the department can automatically provide the student loan interest benefit to eligible service members, and vets” education officials said in a statement. “Today’s announcement means that service members are not required to take any action to receive the interest rate benefit.”
Loan recipients should see the changes appear automatically in their accounts. Individuals with questions can contact Department of Education officials with questions regarding the benefit. (continue reading)