To Defer...Or, Not To Defer...That is The Question

[brf101081]

So, the Army will begin paying off my students loans through the Loan repayment program, $25,000 and $3,000. How it works is, after all the paper work, they make 3 payment over three years. The payment are on your anniversary in the military, mine is this august. They pay 33% of each loan every year, so $25,000 minus$ 8,000 and $3,000 minus $1000, its not a bad deal.

 

Anyways, i have been paying my minimum balance on both loans since august to keep my account in goods standing (a requirment for the program. People were telling me i should defer them and wait 'til i get out and pay what the program wont cover (i/e interest).My question is , Should i defer and have more money in my pocket to spend, or work now and play later and keep paying in between my annual payments?

[brf101081]

No one likes me .................. this is a ploy to get responses

[odudave]

I would consider putting them in deferrment and then pay the interest when the quarterly interest statement comes out. Since you know they are going to get paid, the big chunk of it is covered. Do you currently get a quarterly interest statement? It's probably not too high on that size of a loan and will be less than your current monthly payments combined.

[bhpepper]

If you are going regular army:

 

The pay 33% of the TOTAL of your eligible loans each year. They should pay your loans in full.

 

Also -- I believe (unless things have changed) you can get an interest free deferrment while in the military.

 

 

 

Be careful with the loan repayment program. I left the army early due to faulty enlistment contract. I could have stayed but after 9 months of the army telling me I was wrong, when I proved in fact I was right we took the out. The whole process made me distrustful that they could look after my family if I were to be stuck in combat somewhere.

 

Ask me any questions you like - I will do my best to tell you what i have learned