Military Student Loans

Military Student Loans Pave the Way for Service Members to Attend College

Military student loans are a form of federal student financial aid that is generally paid for by the United States Department of Education (DOE) or the Department of Defense (DOD).  If you serve in a critical job in the military or are assigned to a unit that’s experiencing personnel shortages, you may qualify to have a portion of your military student loan repaid by the government.

Types of military student loans you may be eligible to receive include:

  • Subsidized Federal Stafford Loan
  • Unsubsidized Federal Stafford Loan
  • Federal Perkins Loan
  • Federal Consolidation Loan

Interest rates for subsidized loans do not have to be paid by you until after you graduate from an accredited college with your degree, drop out of school for personal or military duty reasons or lower the numbers of courses you take to the point you’re no longer attending college or university on at least a half-time basis.  With unsubsidized loans, you must pay interest on the loan while you’re in school.  As of July 2011 and according to the United States Department of Education, interest rate for subsidized and unsubsidized military student loans was at 6.8 percent for student loans acquired prior to 2011.  Interest rates on subsidized loans that became effective July 2011 are at 3.8 percent; unsubsidized student loans are still at the 6.8 percent interest rate. 

If you have taken out more than one federal or military student loan, you can consolidate the loans using the Federal Consolidation Loan program.  Your loans will be combined into one loan; interest rates you pay may not exceed 8.25 percent as of July 2011 if you took out your loans on or after July 1, 2006. 

Additional Financial Aid for Military College Students

Your parents can also take out a federal loan to help finance your education.  The Federal Direct PLUS loan is designed for parents.  Interest rates on these loans are higher, at 7.9 percent.  Federal Direct PLUS loans must be paid back as soon as they are taken out.  You have up to six months after you graduate to start paying back other military student loans.  Of course, if you drop out of college or reduce your classes below a half-time status, you may also be required to start repaying your military student loan within six months of the change.

If your military duties prevent you from attending college or university after you’ve received one or more military student loans, contact your loan provider and request a deferment on the loan.  You may have to complete and submit a deferment application and provide documentation that confirms your inability to continue your classes due to military obligations.  It remains your responsibility to repay the loan; you simply have to repay the loan on a delayed timeframe.

Through programs like the Post 9/11 GI Bill and the Yellow Ribbon Program, the military shows its support for service members like you who demonstrate a commitment to continued learning.  Whether you plan on serving in the military for four years or for 20 plus years, consider using military student loans, scholarships, grants and other financial aid programs to pay for your postsecondary education.  Doing so may save you thousands of dollars.

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