Zero Percent Student Loan Interest-Relief
Receive relief from student loan interest.
It’s important to know what benefits are available to you so you can make the most of your money. One important benefit you may have overlooked is a zero percent student loan interest benefit. Yes, you read that right! Check out the details below to see if you qualify and to learn how to apply.
What is this benefit?
Federal law exempts some members of the military from paying interest for up to 60 months on certain student loans. This applies to federal Direct Loans, or a portion of a Direct Consolidation Loan, issued on or after Oct. 1, 2008, if you served or are serving in an area that qualifies you to receive hostile fire or imminent danger pay.
Let’s do some quick math to see the impact this benefit may have and then walk through the details in a few simple steps.
For example, if you are a Service member with $40,000 in federal student debt at 6% annual interest, six months of qualifying service would result in reduced interest payments totaling $1,200. That’s $1,200 you could use to further pay down the principal on student debt and further reduce future interest costs, pay down other loans, invest in your retirement, or help meet other day-to-day expenses.
How do I apply?
You can apply for this important benefit by following these easy steps:
1. Learn your loan type and loan servicer by clicking the login button in the upper right-hand corner of https://studentaid.ed.gov/sa. Log in or create an account to view your loan information.
2. Provide your loan servicer with any of the following forms of proof:
· A leave and earnings statement showing receipt of hostile fire or imminent danger pay
· A certifying official’s statement and signature
· Military orders showing service in a hostile area
Many loan servicer websites have a dedicated information page and customer service numbers dedicated to helping you.
What’s next?
Veterans who meet the above qualifications and overpaid student loan interest can take the same steps to apply for reimbursement.
Follow the Office of Financial Readiness on social media for more information and resources on this benefit as they become available: Facebook @DoDFINRED, Twitter @DoDFINRED and Instagram @dodfinred.
