Tuesday, March 29, 2011

Military Members Qualify for Student Loan Forgiveness

The College Cost Reduction and Access Act of 2007 created a new public service loan forgiveness program for military members with federal student loans. The servicemembers must have made 120 payments over 10 years while in the service in order to have the loans discharged. Since the program was only enacted in 2007 all payments must have been made after Oct. 1, 2007 and the earliest date to have your loans discharged will be Oct. 2017.

Military service is one of the qualifying jobs and the service must have been full time as defined by the College Cost Reduction and Access Act which for National Guard members means that they must be “full time” National Guard as defined by section 101(d)(1) and (d)(5) of title 10, United States Code. In order to have the loans discharged the student must be working in a qualifying occupation at the time of discharge and there other jobs that count towards the requirement.

Public service jobs other than the military that qualify for the program are jobs with federal, state, and local government organizations, teachers, first responders (police, fire, EMT), public librarians, social workers, public defenders, and those employed at public schools and colleges.

The program covers federal Stafford, Grad PLUS, or consolidation loans as long as they are in the Direct Loan program however it does not cover Parent PLUS loans or private student loans. The federal Direct Loan program is a federal program where the college becomes the lending agency and manages the funds directly, with the federal government providing the funds. To determine if your loans are in the Direct Loan program and for questions please call the Direct Student Loan program at 1-800-848-0979. If the federal student loans are NOT in the Direct Student Loan program than they would have to be consolidated into the program in order to be eligible for forgiveness and this can be done at the federal website for consolidation at http://loanconsolidation.ed.gov.

Qualifying payments are payments made through Direct Loan Program in any of the following payment plans, the Income Contingent Repayment plan, Standard Repayment plan and the Income-Based Repayment (IBR) plan.

Because this is a new program students should keep W-2’s for the ten year proving qualifying work experience for the ten year time period as well as a record of student loan payments that can be verified. More information will be available as the Oct. 2017 date approaches, for updates please visit the Direct Loan Center at https://www.dl.ed.gov.


1. http://www.finaid.org/loans/forgiveness.phtml

2. http://www.ibrinfo.org/what.vp.html

3. https://www.dl.ed.gov/borrower/BorrowerWelcomePage.jsp

4. https://www.dl.ed.gov/borrower/contactUs.do?BORROWER=1

5. http://edocket.access.gpo.gov/2008/pdf/E8-24922.pdf

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