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In the military with student loans? Check this out.

Home Student Loan Management In the military with student loans? Check this out.

  • The White Coat Investor The White Coat Investor 
    Keymaster
    Status: Physician
    Posts: 4260
    Joined: 05/13/2011

    I received an email I’m going to post here:

    I want to pass on a benefit of which I recently came aware and can verify as a great option. It is referred to as the military-based student loan deferral option. If you accrued Federal Loans for academic purposes, you can utilize this benefit to defer your loans interest-free while on active duty. Although you will ultimately be responsible for the principle loan amount, unlike many deferral programs which cause your loan to accrue interest during deferral periods, the military deferment does not accrue interest. This alone is a great option for those of you who have not started paying back loans and would like to do so interest-free or need a break from paying back loans due to financial issues. 

    The hidden benefit, which is of equal value, is for those of you, like myself, who have been paying back loans while on active duty for several years. With proof of military service during your loan repayment, you can retroactively claim this benefit for your entire active duty service time period. This means that any interest that you paid during active duty time will be refunded to you and immediately be put towards the principle amount of your loan. 

    Although I was skeptical of this benefit, I called my loan servicing company (Navient) earlier this week to find out about the benefit, sent them a copy of my SURF later that day and today (3 days later) was informed that my request was approved and 30% of my principle was wiped away immediately. 

    I am not a financial expert nor can I confirm that all loan servicing companies utilize this same benefit (although I think it is a federal benefit) but I would certainly look into it if you have student loans. By doing this, you can pay back your loans interest free or possibly recoup money that you had previously paid in interest for student loans while you were on active duty.

    Site/Forum Owner, Emergency Physician, Blogger, and author of The White Coat Investor: A Doctor's Guide to Personal Finance and Investing
    Helping Those Who Wear The White Coat Get A "Fair Shake" on Wall Street since 2011

    #131086 Reply
    Liked by cgossage
    jfoxcpacfp jfoxcpacfp 
    Moderator
    Status: Financial Advisor, Accountant, Small Business Owner
    Posts: 7315
    Joined: 01/09/2016

    This is awesome. I think we may have some clients it will help. Please thank whoever sent this.

    Johanna Fox Turner, CPA, CFP, Fox Wealth Mgmt & Fox CPAs ~ 270-247-0555
    https://fox-cpas.com/for-doctors-only/

    #131089 Reply
    ENT Doc ENT Doc 
    Participant
    Status: Physician
    Posts: 3019
    Joined: 01/14/2017

    Wow.  Great catch.  You can also do PSLF too, which may provide more benefit.

    #131091 Reply
    Avatar HikingDO 
    Participant
    Status: Physician
    Posts: 289
    Joined: 03/09/2017

    [Post deleted for violation of forum policy # 1.]

    #131099 Reply
    Liked by Anne
    Avatar nutty08 
    Participant
    Status: Physician
    Posts: 24
    Joined: 09/05/2017

    Cool. Any idea of where I’d get more details on how to apply for this? Mine are with fedloan servicing. Couldn’t find much on the website. Is this a new feature? I doubt I would have missed this when I was AD.

    #131175 Reply
    Avatar nutty08 
    Participant
    Status: Physician
    Posts: 24
    Joined: 09/05/2017

    Ok. I did find this. Looks like my loans are too old. (Darn!)

    https://www.navient.com/loan-customers/for-military-personnel/more-military-benefits/

     

    0% Interest / Military No-Interest Accrual Benefit

    You may be eligible for the Military No-Interest Accrual (MNIA) benefit while you are serving active duty or performing National Guard duty, during a war, other military operation, or national emergency and are serving in a hostile area that qualifies you for special pay under 37 U.S.C. § 310(“MNIA Qualifying Duty”). During MNIA Qualifying Duty, you’re eligible for 0% interest on your Direct Loans for up to 60 months.

    This benefit is only available for Direct Loans, disbursed on or after October 1, 2008. For Direct Consolidation Loans, this benefit applies to the portion of the consolidation loan that repaid loans first disbursed on or after October 1, 2008.

    To request the MNIA benefit:

    • Provide your written request, along with a copy of your military orders showing you’re on MNIA Qualifying Duty to

      Navient
      P.O. Box 9500
      Wilkes-Barre, PA 18773-9500
      Fax: 800-848-1949

    #131176 Reply
    Avatar arecidoro 
    Participant
    Status: Student
    Posts: 3
    Joined: 03/14/2019
    Disability Insurance

    I am HPSP student and will becoming to Active Duty in June. I received a 3 year scholarship so I have loans for the first year with a principle close to 70k which has since grown to 85k with interest. In regards to PSLF, I just wanted to hear thoughts about staying on PAYE the entire time during my time in the military to try to get as much of this forgiven.

    #198465 Reply
    Avatar ActiveDuty 
    Participant
    Status: Physician
    Posts: 22
    Joined: 01/13/2016
    AND are serving in a hostile area that qualifies you for special pay under 37 U.S.C. § 310(“MNIA Qualifying Duty”). During MNIA Qualifying Duty, you’re eligible for 0% interest on your Direct Loans for up to 60 months.

    Click to expand…

    That may be the sticking point.   Looks like you have to qualify for hostile pay to receive the deferral option.

    #198580 Reply

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