Benefits for Military ServicemembersKerry ChildePrivacy and Regulatory CounselTG

Disclaimer

The opinions expressed during this presentation are my own and not necessarily those of TG or any other party. This presentation is not intended, nor should it be construed, to provide legal advice. If you have questions about how these rules apply to your program, please consult your program’s legal counsel.

Agenda

• Servicemembers Civil Relief Act • HEROES Act Waivers• Veterans Disability Discharge• Deferments• Military/Department of Defense (DoD) Repayment

• History of the SSCRA and SCRA• Servicemembers eligible for benefits

- Servicemember- Spouse- HEA endorser

Servicemembers Civil Relief Act (SCRA)

SCRA

• Benefits under SCRA– General servicemember benefits– HEA-specific benefits

• Loans eligible for benefit• Interest rate capped at 6%• Effects on borrower/endorser and lender/servicer

• Proposed Rule/Final Rule

Higher Education Relief Opportunities for Students (HEROES) Act of 2003

• The Higher Education Relief Opportunities for Students Act of 2003 (P.L. 108-76) provided the Secretary of Education with specific waiver authority to respond to war or other military operation, or national emergency.

• Authorized actions

Military extension of the grace period

• Qualifications– Must be in grace or in-school status– Must have been member of a reserve component of the

U.S. Armed Forces called or ordered to active duty on or after October 1, 1998

– Active duty period must be more than 30 days

• Duration– Any one extension cannot exceed three years

Mandatory forbearances

• Servicemember qualifies for partial repayment under the Student Loan Repayment Programs administered by the DoD

• Servicemember is on active military state duty as a member of the National Guard

Veterans disability discharge

• Effective August 14, 2008• Discharge Standards

– Service-connected disability or disabilities that are 100% disabling

– Unemployable due to service-connected condition

Veterans disability discharge

• Required documentation– Veteran Affairs Rating Decision or letter confirming

borrower met one of the discharge standards– Discharge application

• Discharge is immediate

Current deferments

• Military service deferment

• Post-active duty deferment

Military service deferment

• Program: FFELP, FDLP, and Perkins• Service: Active duty in the U.S. Armed Forces• Borrower:

– For borrowers with 10/1/2007 active duty– Deferment is loan-specific for loans disbursed on or after

7/1/2001 (but see also CCRAA)

Military service deferment

• Request: From borrower to lender/servicer– Must provide the lender/servicer with all documentation

required to establish eligibility– May use MIL (Military Deferment) request form

• Length: 12 months without other documentation– Ends 180 days after the end of borrower’s mobilization

(borrower with 10/1/2007 active duty)

Military service deferment

• Important statutory/regulatory provisions– 10 U.S.C. 12301(a) [reserves ordered to active duty]– 10 U.S.C. 12301(g) [Reserve is POW/MIA]– 10 U.S.C. 12302 [Ready Reserve — largest] – 10 U.S.C. 12304 [Selective Reserve/ Inactive Ready Reserve] – 10 U.S.C. 12306 [Standby Reserve]

Military service deferment

• Important statutory/regulatory provisions– 10 U.S.C. 688 [Retirees activated for duty]– 10 U.S.C. 101(a) and (d) [definitions]– 32 U.S.C. 502 [required drills and training exercises]

Military service deferment — borrower orders

Military service deferment — borrower orders

Military service deferment — borrower orders

Military service deferment — borrower orders

Military service deferment — borrower orders

Post-active duty deferment

• Program: FFELP, FDLP, and Perkins• Service: National Guard or other reserve component

on active duty on or after 10/01/2007

• Borrower: Enrolled and called to qualifying active duty

Post-active duty deferment

• Request: From borrower to lender/servicer– Lender requests documentation; may accept

orders/ID• Length: 13 months following completion of qualifying

active duty– Grace period and deferment run concurrently

Old deferments

• Old Armed Forces deferment

• Old public health service deferment

• Old National Oceanic and Atmospheric Administration (NOAA) Corps deferment

Old Armed Forces deferment

• Program: FFELP, FDLP, and Perkins• Service: Active duty in U.S. Armed Forces• Borrower: Prior FFELP or PLUS loans

– Public service deferment

Old Armed Forces deferment

• Request: From borrower to lender/servicer– Letter from commander OR– Copy of orders and copy of military ID– PUB form can be used

Old Armed Forces deferment

• Length: – Originally had maximum three years lifetime benefit– Includes any old deferments– HEROES waivers (time served as affected individual)

Old public health service deferment

• Program: FFELP, FDLP, and Perkins• Service: Commissioned Officer in PHS• Borrower: Prior FFELP or PLUS loans

– Public service deferment

Old public health service deferment

• Request: From borrower to lender/servicer– Written statement from authorized PHS official– Must include service dates– May use PUB deferment request form

• Length: Maximum three years lifetime benefit– Includes any old deferments

Old NOAA Corps deferment

• Program: FFELP, FDLP, and Perkins• Service: Serving in NOAA Corps• Borrower: No pre-1987 outstanding balance

– Public service deferment

Old NOAA Corps deferment

• Request: From borrower to lender/servicer– Written statement from authorized NOAA official– Must include service dates– May use PUB deferment request form

• Length: Maximum three years lifetime benefit– Includes any old deferments

Other military benefits

• Public service loan forgiveness (FDLP only)• College Loan Repayment Program (loans before service)• DoD Loan Repayment Program (civilian employees)

Contact information

Kerry Childe, TG512-219-2921kerry.childe@tgslc.org

Questions?

This presentation is available for download at

www.tgslc.org/tgconference.