Biden Administration To Cancel Student Loan Interest Retroactively For 47,000 Military Service Members

This article has been updated. 

The Biden administration announced on Friday that it will retroactively waive student loan interest for thousands of current and former active-duty military service members.

Federal law provides that military service members deployed on missions that qualify them for special pay can have their interest waived on certain federal student loans. However, service members have to affirmatively request this relief; it is not provided automatically. The documentation requirements for the request can be onerous and must include a formal application along with a certifying official’s statement and signature, a copy of military orders showing the service member is serving in a hostile area, or a Leave and Earnings Statement demonstrating hostile or imminent danger pay. As a result, many military service members are unaware of the benefit or do not apply for it, resulting in ongoing interest accrual and balance growth while they are deployed.

Today’s announcement by the U.S. Department of Education will provide for an automatic, retroactive waiver of interest for qualifying military service members. The relief will apply to interest that was not waived during a service member’s time serving in a hostile area, for federal student loans that were first disbursed on or after October 1, 2008. The Department will be using data-matching tools in coordination with the U.S. Department of Defense to grant the relief automatically. Approximately 47,000 service members with federal student loans are expected to benefit, according to the Department of Education.