Editor's Note: For the latest developments regarding federal student loan debt repayment, check out our student debt guide.
Serving the country could serve your bottom line. The Army, Navy, Air Force, Coast Guard, and National Guard offer programs for repaying part or all of your student loans, if you qualify.
Does the Military Pay Off Your Student Loans?
It might, but you must choose to work in specific military specialties, score at least 50 on the Armed Services Vocational Aptitude Battery, and commit to years of duty.
Key Points
• Military branches offer student loan repayment assistance programs that can cover significant portions of student loans for eligible members who commit to specific service terms.
• The Army, Navy, Air Force, Coast Guard, and National Guard have distinct programs, with potential repayments reaching up to $65,000 depending on the branch and commitment length.
• Various programs exist specifically for health professionals and certain military roles, providing substantial repayment assistance, sometimes exceeding $40,000 annually.
• Additional benefits for service members include interest rate caps and waivers on student loans while deployed in hazardous areas, enhancing financial relief during active duty.
• While military forgiveness options exist, some programs require careful navigation of eligibility criteria, and refinancing may impact access to federal repayment benefits.
Military College Loan Repayment Program
Military enlistees, and some already enrolled members, can receive student loan repayment assistance of up to $65,000 for a three- or six-year commitment. Federal student loans and even some private student loans may be forgiven.
To qualify for the LRP programs, you cannot have previous military experience. You must choose to work in one of the military occupational specialties that the military branch is seeking. And many of the programs will require withdrawal from the GI Bill program.
Army Student Loan Repayment: Active Duty
The Army’s Loan Repayment Program is offered to highly qualified applicants enlisting for at least three years. If you meet the eligibility requirements, the Army will pay up to 33.33% of your current principal balance, or $1,500, whichever is greater, per year served. The maximum in loan assistance is $65,000.
Army Reserve College Loan Repayment Program
For this Reserve repayment program, you must enlist for at least six years. The Army will repay 15% of your outstanding principal balance or $1,500, whichever is greater, after each year of service. The total can’t exceed $20,000.
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National Guard Student Loan Repayment Program
To qualify for the National Guard Student Loan Repayment Program, you must enlist for at least six years. You could earn up to $7,500 each year of the incentive term, or up to $50,000 in total student loan repayment.
Navy Student Loan Repayment Program
The Navy will pay 33.33% of the principal balance of a borrower’s federal student loans or $1,500, whichever is higher, for each year of service, up to three years.
The Navy Loan Repayment Program may pay up to $65,000 toward a service member’s student loans.
Coast Guard Loan Repayment Program
The Coast Guard offers new members who commit to three years of service up to $10,000 in loan repayment each year after the first year of active service. The maximum assistance is $60,000.
Health Professions Student Loan Repayment Program
This Army program eases the student debt of doctors, dentists, and other health care professionals who are on active duty or in the Army Reserve. Borrowers can get up to $40,000 of their student loans repaid annually. The maximum assistance is $120,000.
Then there’s the Air Force Financial Assistance Program, for medical and dental residencies. You may receive more than $45,000 for every year you participate in the program plus a stipend of more than $2,000 per month to cover living expenses. Upon completion of your residency, you will have a one-year obligation for each year of participation, plus one extra year.
Prior Service Soldier Loan Repayment Program
Members of the Army Reserve with prior military service may receive up to $50,000 for student loan repayment.
Air Force Judge Advocate General’s Corps Loan Repayment Program
Eligible judge advocate generals (JAGs) can apply for up to $65,000 in student loan repayment. After you have completed the first year as a JAG officer, payments are made directly to lenders for three years.
Other Loan Forgiveness Programs for Military Personnel
National Defense Student Loan Discharge
Active-duty soldiers who have served in hostile fire or imminent danger pay areas for at least one year are eligible for cancellation of their federal Perkins Loans.
A borrower may see 100% of their loan principal, plus interest, canceled for a five-year term of service that began on or after Aug. 14, 2008.
Veterans Total and Permanent Disability Discharge
If you are totally and permanently disabled, you may qualify for discharge of your federal student loans or TEACH Grant service obligation.
In 2021, eligible borrowers identified as totally and permanently disabled based on data matching with the Social Security Administration began automatically having their federal student loans discharged.
Public Service Loan Forgiveness
In the Public Service Loan Forgiveness program, borrowers who serve full time in the military or who have gone on to other types of public service, including in government agencies, many nonprofits, police departments, and public health organizations, may have any federal student loan balance discharged after making 120 payments (not necessarily in a row).
To qualify, you must sign up for an income-driven repayment plan, meet the job criteria, and make 10 years’ worth of on-time payments.
Other Student Loan Benefits for People in the Military
Interest Rate Cap
Under the Servicemembers Civil Relief Act, the interest rate on any debt incurred before enlisting in the military, including both federal and private student loans, is capped at 6% while you’re on active duty.
Interest Waiver for Those at Dangerous Posts
The Department of Education announced in late 2021 that Under the Higher Education Act, service members deployed to areas that qualify them for imminent danger or hostile fire pay would have no interest accrual on certain federal student loans that were first disbursed on or after Oct. 1, 2008.
The Takeaway
Military student loan forgiveness is possible if you clear a number of hurdles. But you might still need to pay at least a portion of your loans while you’re enlisted and after you resume civilian life.
For many people, refinancing student loans can be a way to get a lower interest rate or a lower monthly payment, especially with a solid credit and employment history. (Note: You may pay more interest over the life of the loan if you refinance with an extended term.)
Refinancing allows you to take out a new loan, with new terms, and use it to pay off your existing federal or private student loans. While doing so can have advantages, you’d be giving up federal programs like Public Service Loan Forgiveness and income-driven repayment plans, and some of the military-specific loan repayment assistance.
Looking to lower your monthly student loan payment? Refinancing may be one way to do it — by extending your loan term, getting a lower interest rate than what you currently have, or both. (Please note that refinancing federal loans makes them ineligible for federal forgiveness and protections. Also, lengthening your loan term may mean paying more in interest over the life of the loan.) SoFi student loan refinancing offers flexible terms that fit your budget.
FAQ
Does the VA forgive student loans?
The Department of Veterans Affairs has a student loan repayment program for employees in certain occupations. You may be eligible to receive up to $10,000 per year, with a maximum of $60,000, toward the debt.
The VA also offers the Education Debt Reduction Program for health care providers who serve veterans. Up to $200,000 in student loan repayment is offered.
How much student loan debt will the military pay?
Generally up to $65,000, depending on the military branch.
Do 100% disabled veterans pay student loans?
A borrower who is declared totally and permanently disabled is typically not required to repay federal student loans.
SoFi Student Loan Refinance
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