FORT CAMPBELL, KY, Sept. 16, 2011--In these tough economic times, many Soldiers and their Families not only struggle to pay their regular bills, but also may bear the expense of repaying student loans.

Betty Geren, financial advisor at the Fort Campbell Army Community Service Financial Readiness Office, said counselors there have seen an increase in Soldiers of all ranks swimming in debt from educational loans.

"We're seeing too many of them," she said. "This debt is not going to go away."

Geren and Cathy Owens, education services specialist with the Staff Sgt. Glenn English Army Education Center, are concerned about Soldiers and their Family members being aggressively pursued and misled by some for-profit schools.

Citing a December 2010 report from the U.S. Senate's Health, Education, Labor and Pensions Committee, Owens noted that many service members who receive military education funding through the Department of Defense and the VA are falling prey to "manipulative and misleading marketing campaigns."

"There are some very good for-profit schools and some that aren't. Some that have shady practices and some that don't," she said.

The result is Soldiers and Family members owing thousands of dollars to a higher education institution and many don't have degrees to show for it.

During an Aug. 24 visit to Fort Campbell, Holly Petraeus, director of the Office of Servicemember Affairs, a part of the Consumer Financial Protection Bureau, said her mission is to see that military Families are financially educated and that complaints of fraud are monitored.

"You don't want a service member who is deployed … worried about financial issues at home when they should be focused on the very dangerous tasks they've been given to do overseas," she said.
"Anything we can do to help lift that problem off their shoulders is something all of us feel is something worth working on."

Owens said the best defense against falling victim to these fraudulent practices is to compare the degree programs and tuition costs of other schools before registering with any college or signing any forms.

Community colleges, for example, are very reasonably priced, may offer the same degree as a for-profit school and credits earned usually transfer easily to a state university or other four year college or university, she said.

"Don't sign any contract whatsoever," Owens said. "Bring it into an ed counselor, go to a lawyer, go to [the Army Community Service] office and let somebody see it."

For Soldiers or their Family members who are interested in pursuing a degree, Owens suggests that they watch for "red flags" when selecting a college, university or educational program.

"Think carefully before mak[ing] a decision," she said.

"Don't let a really good salesperson make your decision for you," Owens said. "This is your education. It could be one of the most important decisions you make."
Geren noted that many times ACS counselors deal with the aftermath of the loans a Soldier acquired as a civilian -- before entering the military. Fortunately, help is available to Soldiers, and their Families, through the ACS office located at 5662 Screaming Eagle Blvd.

"If they have this issue, they should make an appointment with one of the financial counselors," Geren said. "Step by step [we'll] see what the counselor or financial planner can do to help."

As their appointment date with an ACS financial counselor approaches, Soldiers should be proactive in preparing for their meeting, Geren said.

Soldiers should gather all of their student loan information together before they meet with ACS counselors. The borrower can go to to get a summary of all their government loans and should contact their private lender or school for the amounts of their private loans.

Then, they should break it down as to how much is government or federal and how much is private loans, Geren added.

"When they come in, they should know [how much they owe]," she said.

Soldiers and the ACS financial counselors will review the Soldier's financial situation and their options.

Among these options are payment relief programs available through lending institutions for federal loans, according to The Federal Student Aid Ombudsman of the U.S. Department of Education.

These payment relief programs include:
• A deferment - a temporary suspension of loan payments for specific situations such as returning to school, unemployment, disability or military service.
• Forbearance - a temporary postponement or reduction of payments for a period of time because you are experiencing financial difficulty.
• Graduated payment plans provide short-term relief through low, interest-only payments followed by standard principal and interest payments.
• Income-sensitive, income based or income-contingent payment plans offer payment relief with payments that are a specific percentage of a person's gross monthly income.

Soldiers with education loans through private lenders may be able to get assistance from the lender.
For civilians with student loans, who are considering entering the military, the Army has some incentives to help with education debt.

The Army's Loan Repayment Program is a special enlistment incentive that the Army offers to highly qualified applicants at the time of enlistment, according to
Under the LRP, the Army will repay up to $65,000 of a Soldier's qualifying federal student loans.

Several qualifications determine the eligibility for this program.
Private loans, equity loans, state-funded loans, institution loans and consolidated loans for someone else, such as a Family member, are not covered under this Act.

The LRP payments will only be authorized toward the remaining original unpaid principal balances as verified at the time the Soldier enters active duty, according to Loans incurred after entering active duty will not be re-paid. Interest that has been re-capitalized into principal will not be re-paid.

Additionally, Geren said they should consider alternate funding through grants or scholarships.
Private student loans should be your last avenue for getting funds for a college education, she said.
For those who have incurred debt through student loans, Soldiers should be aware that they will be expected to pay that money back.

"There's no way out, except to pay it back," Geren said. "When we're talking $50-, $60-, $70,000 for a specialist, think how long that's going to be."
Petraeus pointed service members and their Families to military-friendly counselors to receive financial guidance and assistance before it's too late.

"There is, I think, a reluctance in the military to go forward and ask for help," Petraeus said. "There are some great agencies here on the installation, these states and at [federal] level that would much rather help you when the problem is small than to pick up the pieces when it's all fallen apart."

To get assistance, Soldiers may contact the Fort Campbell Ed Center at (270) 798-3201 and meet with education counselors or Fort Campbell's ACS Financial Readiness Office at (270) 798-5518 and speak with accredited financial counselors. Services are free.

Before getting any student loan, Geren said individuals have to look out for themselves, too.

"Be a smart consumer. Read the fine print. Know what you are signing," Geren said.

Editor's note: This is the first in a series of articles on education finances and the military.

Page last updated Fri September 16th, 2011 at 11:19