Education/Student Loan questions (SCRA, repayment)

[SPiF]

I'd go to the legal aid office, they can probably help give you more direction and advice, esp. being a guardsman on orders. I've found alot of people don't realize that guardsmen go on AD and are treated just like anyone else on AD (the whole Total Force concept). They can help you lay the smack down.

[sledy]

Hey Sleepy

Sorry to hear about the troubles. I used your letter with SLFC and didn't really have any problems. When I talked with them they capped my commerical loans at 6%, but my federal consolidated loans they offered to put them on a Dep. of Defense deferrment. I talked with the legal dept on base and they helped a bit. As the others have said that should be a good bet, good luck.

Sledy

[spectre56]

I was given the student repayment as part of a re-enlistment package while I was enlisted. They fail to tell you that they only make payments once a year on your anniversary date. So they made two payments and then I got my commission.

After commissioning I was told that officers are not eligible for this program and no further payments were made.

Is this common knowledge? Or is student loan repayment for officers definately not going to happen?

[Guest JorryFright21]

Is this common knowledge? Or is student loan repayment for officers definately not going to happen?

Common knowledge among those who ask, so not really. Never happen. Yep, I used the word never.

[Sierra Hotel]

Anyone have a copy of Sleepy's letter for the SCRA?

Thanks,

McLovin

[BONE WSO]

Here is the one I sent good ole Sallie Mae and it worked. 6% on private loans after I got my flight commander to sign some paperwork that they emailed me.

24 Jun 07

To: Sallie Mae Servicing

ATTN: Correspondence

PO Box 9500

Wilkes-Barre, PA 18773-9500

RE:

Dear Sallie Mae Servicing:

On 20 February 2004 I was called to active duty in the United States Air Force,and I have been continually serving on active duty since that date.

Under the Servicemembers' Civil Relief Act (SCRA), 50 United States Code Appendix Section 526, I should receive a maximum interest rate of 6% on all account balances incurred before I came on active duty. Under the SCRA, I understand that any interest due above this 6% rate is forgiven. Please refund my account any excess charges and change my account to reflect the requirements of the SCRA, and adjust all monthly payments to the 6% interest rate.

I have enclosed a copy of my current active duty orders and my active duty orders calling me to service for your reference.

I will notify you as soon as my active duty ends.

Sincerely,

[capt4fans]

Here is the one I sent good ole Sallie Mae and it worked. 6% on private loans after I got my flight commander to sign some paperwork that they emailed me.

24 Jun 07

To: Sallie Mae Servicing

ATTN: Correspondence

PO Box 9500

Wilkes-Barre, PA 18773-9500

RE:

Dear Sallie Mae Servicing:

On 20 February 2004 I was called to active duty in the United States Air Force,and I have been continually serving on active duty since that date.

Under the Servicemembers' Civil Relief Act (SCRA), 50 United States Code Appendix Section 526, I should receive a maximum interest rate of 6% on all account balances incurred before I came on active duty. Under the SCRA, I understand that any interest due above this 6% rate is forgiven. Please refund my account any excess charges and change my account to reflect the requirements of the SCRA, and adjust all monthly payments to the 6% interest rate.

I have enclosed a copy of my current active duty orders and my active duty orders calling me to service for your reference.

I will notify you as soon as my active duty ends.

Sincerely,

Bone,

I have to ask, why did you put Section 526 in the letter. From looking at the SCRA, I came up with a different section that addresses the maximum indebtedness percentage. I think it was 206.

Thanks for the answer, and you can PM me if that's easier.

[BONE WSO]

Bone,

I have to ask, why did you put Section 526 in the letter. From looking at the SCRA, I came up with a different section that addresses the maximum indebtedness percentage. I think it was 206.

Thanks for the answer, and you can PM me if that's easier.

Not sure why. I got that letter from a Chaplain in Pensacola that just handed us the form letter when we checked in and I copied it. I never actually read into the SCRA program.

[Guest pblarson7]

It should refer to section 207:

(a) INTEREST RATE LIMITATION-

(1) LIMITATION TO 6 PERCENT- An obligation or liability bearing interest at a rate in excess of 6 percent per year that is incurred by a servicemember, or the servicemember and the servicemember's spouse jointly, before the servicemember enters military service shall not bear interest at a rate in excess of 6 percent per year during the period of military service.

(2) FORGIVENESS OF INTEREST IN EXCESS OF 6 PERCENT- Interest at a rate in excess of 6 percent per year that would otherwise be incurred but for the prohibition in paragraph (1) is forgiven.

(3) PREVENTION OF ACCELERATION OF PRINCIPAL- The amount of any periodic payment due from a servicemember under the terms of the instrument that created an obligation or liability covered by this section shall be reduced by the amount of the interest forgiven under paragraph (2) that is allocable to the period for which such payment is made.

(b) IMPLEMENTATION OF LIMITATION-

(1) WRITTEN NOTICE TO CREDITOR- In order for an obligation or liability of a servicemember to be subject to the interest rate limitation in subsection (a), the servicemember shall provide to the creditor written notice and a copy of the military orders calling the servicemember to military service and any orders further extending military service, not later than 180 days after the date of the servicemember's termination or release from military service.

(2) LIMITATION EFFECTIVE AS OF DATE OF ORDER TO ACTIVE DUTY- Upon receipt of written notice and a copy of orders calling a servicemember to military service, the creditor shall treat the debt in accordance with subsection (a), effective as of the date on which the servicemember is called to military service.

[Guest crank]

Does the AF provide any student loan forgiveness or options? I was not on AF scholarship, only stipend,...but i have hefty school loans. Just looking into options before I consolidate with a particular bank. Basically, if I don't find anything I'm going to check with finance when I get to my base for options if I have any.

[M2]

Does the AF provide any student loan forgiveness or options? I was not on AF scholarship, only stipend,...but i have hefty school loans. Just looking into options before I consolidate with a particular bank. Basically, if I don't find anything I'm going to check with finance when I get to my base for options if I have any.

Yeah, it's called a paycheck. You got the education, now you need to pay whatever institutions were kind enough to lend you the money to get it. If you wanted a free education, you should've gotten a scholarship or gone to the Academy.

That said, I think some states will forgive some or all of the loans they give if you serve a certain amount of time in a combat zone. You'll have to do some homework on that yourself; but otherwise, man up and pay your debts!

Cheers! M2

[Palangi]

Yeah, it's called a paycheck. You got the education, now you need to pay whatever institutions were kind enough to lend you the money to get it. If you wanted a free education, you should've gotten a scholarship or gone to the Academy.

Classic.

That being said. TA is a nice "gift" to have. I still can't believe the number of people who don't use it.

[FLY6584]

Actually if you have any private student loans that are over 6% you can have the rate reduced to 6% for the rest of the term of the loan and the government pays the difference.

In my case I had a Sallie Mae private loan that I used for my flight program and it was at 9.25%. After commissioning and finding out about this program I called up Sallie Mae and told them about this and they immediately reduced my rate to 6.00% and then credited me back the 3.25% of interest that my loan accrued from the time I commissioned to the time I made that phone call. I think I just had to fax them a copy of my orders and that was it.

Unfortunately that doesn't apply to Federal Loans, but Federal Loans should be below 6% anyways. Also I believe that 6% program can be applied to any other debt that you accrued PRIOR to commissioning, but I'm not positive about that.

[Toasty]

Actually if you have any private student loans that are over 6% you can have the rate reduced to 6% for the rest of the term of the loan and the government pays the difference.

In my case I had a Sallie Mae private loan that I used for my flight program and it was at 9.25%. After commissioning and finding out about this program I called up Sallie Mae and told them about this and they immediately reduced my rate to 6.00% and then credited me back the 3.25% of interest that my loan accrued from the time I commissioned to the time I made that phone call. I think I just had to fax them a copy of my orders and that was it.

Unfortunately that doesn't apply to Federal Loans, but Federal Loans should be below 6% anyways. Also I believe that 6% program can be applied to any other debt that you accrued PRIOR to commissioning, but I'm not positive about that.

Got a freakin' phone number for this program?? I'm way, way interested.

[spectre56]

It's the Servicemember's Civil Relief Act.

[FLY6584]

It's the Servicemember's Civil Relief Act.

Yep, what he said. I would just speak with your loan provider about it. Unfortunately you may have to go through a ton of agents until you find one that knows what the heck they are talking about. I was lucky to get a former military guy on the phone with Sallie Mae and he knew exactly what I was talking about and was super helpful.

[Guest crank]

There's a lot of info on the forums about SCRA, do a search. Any loan obtained before commissioning must be reduced to 6%.

Servicemembers Civil Relief Act (SCRA)

Section 207 - Maximum rate of interest on debts incurred before military service

(a) INTEREST RATE LIMITATION-

(1) LIMITATION TO 6 PERCENT- An obligation or liability bearing interest at a rate in excess of 6 percent per year that is incurred by a servicemember, or the servicemember and the servicemember's spouse jointly, before the servicemember enters military service shall not bear interest at a rate in excess of 6 percent per year during the period of military service.

(2) FORGIVENESS OF INTEREST IN EXCESS OF 6 PERCENT- Interest at a rate in excess of 6 percent per year that would otherwise be incurred but for the prohibition in paragraph (1) is forgiven.

(3) PREVENTION OF ACCELERATION OF PRINCIPAL- The amount of any periodic payment due from a servicemember under the terms of the instrument that created an obligation or liability covered by this section shall be reduced by the amount of the interest forgiven under paragraph (2) that is allocable to the period for which such payment is made.

(b) IMPLEMENTATION OF LIMITATION-

(1) WRITTEN NOTICE TO CREDITOR- In order for an obligation or liability of a servicemember to be subject to the interest rate limitation in subsection (a), the servicemember shall provide to the creditor written notice and a copy of the military orders calling the servicemember to military service and any orders further extending military service, not later than 180 days after the date of the servicemember's termination or release from military service.

(2) LIMITATION EFFECTIVE AS OF DATE OF ORDER TO ACTIVE DUTY- Upon receipt of written notice and a copy of orders calling a servicemember to military service, the creditor shall treat the debt in accordance with subsection (a), effective as of the date on which the servicemember is called to military service.

Didn't want to turn this into a SCRA discussion...just trying to see if the AF has any debt relief for people who paid they're way through college instead of the AF paying their way.

[Guest XJT-FO]

Search didnt turn up much but, does anybody know if the soldiers and sailors act applies to deferment of student loans while at OTS and UPT? It would be nice to have a break from those bad boys for a while. haha.

[Butters]

Search didnt turn up much but, does anybody know if the soldiers and sailors act applies to deferment of student loans while at OTS and UPT? It would be nice to have a break from those bad boys for a while. haha.

No, for a lot of reasons.

You were not in the military when you acquired the debt and OTS and UPT do not meet the intent of the SSRA which is primarily meant for those who are deployed ISO combat operations.

[Guest XJT-FO]

No, for a lot of reasons.

You were not in the military when you acquired the debt and OTS and UPT do not meet the intent of the SSRA which is primarily meant for those who are deployed ISO combat operations.

Ok. Sounds right. Thanks for the info.

[BADFNZ]

No, for a lot of reasons.

You were not in the military when you acquired the debt and OTS and UPT do not meet the intent of the SSRA which is primarily meant for those who are deployed ISO combat operations.

Although I'm not sure if student loans can be deferred under the SCRA, your two reasons are incorrect. The whole point of the SSRA is to relieve those of loans acquired BEFORE entering active duty service. It does not apply to loans acquired AFTER entering active duty. I got my mortgage and two car loans lowered to 6%, and both of those were acquired well before I had even applied to OTS. Also, OTS and UPT do meet the intent of the SCRA, which is meant for all those who are active duty (not sure if it applies to Guard or Reserve).

To the OP, I doubt you can defer student loans according to the SCRA during OTS because to them, AD is AD. You might be able to talk to your loan provider and see if they'll do it out of the kindness of their heart.

https://usmilitary.about.com/od/sscra/l/blscramenu.htm

[D-ron]

Search didnt turn up much but, does anybody know if the soldiers and sailors act applies to deferment of student loans while at OTS and UPT? It would be nice to have a break from those bad boys for a while. haha.

My student loan website says that being active duty military qualifies one for a loan deferment and there is currently no time limit on the length of the deferment due to the College Cost Reduction and Access act of 2007. However, it has the disclaimer that it excludes members in training, which probably means you can't get it at OTS or UPT. This may only apply to certain types of loans. I would call your loan provider and find out.

[SPiF]

I know I've gotten a military service deferment (currently on it, actually) and I'm a UPT stud. There's a deferment form you have to find out (for federal student loans, or federal student loan consolidations) and you send in a copy of your most recent EAD or PCS orders, or have your commander sign the form. I sent it in, checked back 2 weeks later, and I was deferred for a year to begin with.

[Butters]

Although I'm not sure if student loans can be deferred under the SCRA, your two reasons are incorrect. The whole point of the SSRA is to relieve those of loans acquired BEFORE entering active duty service. It does not apply to loans acquired AFTER entering active duty. I got my mortgage and two car loans lowered to 6%, and both of those were acquired well before I had even applied to OTS. Also, OTS and UPT do meet the intent of the SCRA, which is meant for all those who are active duty (not sure if it applies to Guard or Reserve).

To the OP, I doubt you can defer student loans according to the SCRA during OTS because to them, AD is AD. You might be able to talk to your loan provider and see if they'll do it out of the kindness of their heart.

https://usmilitary.about.com/od/sscra/l/blscramenu.htm

Crap, you are right, I always get that part wrong. But I thought it only apllied if you were being deployed, not just joining the military and going to UPT. Anyway, it is really up to your provider so asking never hurts. I just paid mine off during UPT, i was not spending a lot of money studying all the time.

[VFR800]

It's called a military forbearance, and some lenders offer them. Usually it's only for a year, and you can renew it for up to 3. Ask your lender if they offer this. I know the Dept of Ed does.