Military College Loan Repayment Programs

The Military College Loan Repayment Program (CLRP)

In 2017, the Military College Loan Repayment Program (referred to as “CLRP”) remains the single-best Federal Student Loan Forgiveness Program available to anyone, anywhere.

It’s also by far the most powerful Military Student Loan Forgiveness Program in existence, and the only widely available military benefit that helps get rid of existing student loans.

The Military College Loan Repayment Program comes in several iterations, with each service branch offering their own specific benefits, but the reason I think this is such an important benefit is that CLRP benefits may allow you to pay off up to $65,000 in student loans.

But keep in mind that all of this could evaporate over night if President Trump’s Student Loan Reforms change the way the system works, and that if you’re still sitting on the fence over whether or not to use these benefits, it’s time to get moving, because you’ll want to be grandfathered into them if his plan wipes them out for future military personnel.



Military CLRP Benefits

One of the most effective ways to get your student loan debt forgiven is by joining the military (or reenlisting for a longer service contract) and taking part in the Military College Loan Repayment Program, which provides up to $65,000 of repayments on any student loans that were taken out before joining (or reenlisting).

This program is only eligible for enlistees who have no previous military service (unless you join the Army or Navy reserves after serving in active duty), or for those who reenlist, and just like any other enlistment incentive, your participation in the program must be stated on your enlistment contract or you will not be able to receive CLRP benefits.

Before you decide to enlist, or re-up, it’s important to note that not everyone qualifies for CLRP, and that not all loans qualify for CLRP either, so please make sure to read through the entirety of this post before deciding that CLRP will work for you.

I’ll detail exactly what it is, how it works for each branch, and how you can maximize the benefit to destroy your student loan debt as quickly as possible.


But Before I Get Into Details…

If you’re truly struggling with your student loan debt, and are only considering joining the military to get access to CLRP benefits, then I’d advise you to not only seriously reconsider that decision, but also to call the Student Loan Relief Helpline to make sure you don’t have other options that require less drastic measures.

I am all for military service, and think it’s a great, patriotic, and honorable thing to enlist, but I don’t think that people should join the service simply to get access to benefits, especially education benefits, and student loan forgiveness benefits.

If you’re having trouble affording your monthly student loan payments, please call the Student Loan Relief Helpline and ask them about your other options. You can reach them by calling 1-888-906-3065..

Try to get as much free information from them as possible before agreeing to pay for anything. Tell them you want to make sure that you’re eligible for something that will help before you agree to pay them to assist you with the paperwork, and see what they recommend.

Don’t think the call is worth it? I do, because there’s a pretty decent chance that you may already qualify for forgiveness benefits that don’t require military service (like the Public Service Loan Forgiveness Program), or you may even be able to attack the validity of your loans and get them entirely discharged by claiming a Borrowers Defense Against Repayment, filing for a Closed School Student Loan Discharge, or perhaps by leveraging the new Navient Student Loan Forgiveness Program.

If you attended ITT Tech, DeVry, or any of the Corinthian Colleges, then you’ll definitely want to look into their forgiveness program as well (click the names of the schools in this sentence for my pages about their benefits packages).

All of these options require far less of an investment and lifestyle change than joining the military, and are likely to be a much better option for most people looking for student loan relief.



CLRP Benefits by Military Branch

Each branch of the military offers a different amount of money via their College Loan Repayment Program, so if you are enlisting specifically for the student loan relief, it’s important to review which branches give the most financial assistance.

And while you may think that all of the branches offer a similar amount, you’d be entirely wrong, because there’s a massive difference in what you’ll get for enlisting in the Army, vs. what you’ll get form the Air Force.

If you’re thinking of joining the Marines for help with student loans, then think again, because they don’t seem to care too much about getting college graduates to join up.

Think closely about your decision to enlist, and review the following details for how much each branch will offer you in assistance, because picking the wrong service could lead to losing tens of thousands of dollars in CLRP benefits.


The Army Student Loan Repayment Program (LRP)

The Army Student Loan Repayment Program benefits cap out at $65,000 in total loan forgiveness.

Army LRP loan repayments are issued for up to 33.33% of the outstanding principal balance of the Soldier’s student loans paid annually, or $1,500, whichever is greater, after their first year of service has been completed.

Army Reserves members are not eligible for as much repayment in some cases, with only 15% of the outstanding balance being eligible for annual repayments, though the limit of $1,500 is still in place, so for those members with smaller loans, the benefit is virtually the same.


The Navy Student Loan Repayment Program (LRP)

The Navy Student Loan Repayment Program benefits cap out at $65,000 in total loan forgiveness, and it’s available to all active duty enlisted personnel.

Qualifying for this program requires signing up to serve at least four years, but it may be a better option to join for 6 (as I’ll detail below), because doing only 4 means that you can get CLRP, but that you won’t be able to take advantage of the Post 9/11 GI Bill, and that means sacrificing tens of thousands of dollars in financial assistance.

Navy Reserves members are only eligible for up to $10,000 in total repayments, however, and they must also agree to serve for a significantly longer period of time, with the minimum service agreement being at least six years.

The National Guard Student Loan Repayment Program (SLRP)

The National Guard’s Loan Repayment Program benefits cap out at $50,000 in total loan forgiveness, but eligibility is a bit more stringent than that offered by the other military branches, as enlistees must enroll with eligible jobs and a six or eight year initial enlistment agreement.

National Guard SLRP is also available to current members of the Guard who extend their enlistment contract for at least six years, meet eligibility requirements, and score high enough on the Armed Forces Qualifying Test.


The Air Force College Loan Repayment Program (CLRP)

The Air Force College Loan Repayment Program benefits cap out at just $10,000 in total loan forgiveness, and benefits are also capped annually at 33.33% or $1,500 (whichever is greater) for eligible student loans.

Once Airmen have received $10,000 in total loan repayments, their eligibility for continued CLRP forgiveness evaporates, which is extremely unfortunate considering that the Navy and Army provide so much additional assistance.

Think long and hard about joining the Air Force if your main goal from enlisting is to get student loan debt forgiven, because the other branches provide a better deal in this regard.

The Marines College Loan Repayment Program for Officers

For one reason or another, the Marines do not participate in the traditional CLRP programs like the other branches of the military.

Views about why they don’t participate differ, but the Marines did recently make a bit of an about face by providing some re-enlistment CLRP-like incentives for officers who re-up with the Corps.

In 2007, the Marine Corps launched a pilot program to provide up to $30,000 of student loan debt for officers who agree to serve an extra 6 months (in addition to their new enlistment contracts), but this program expired in 2011, and I haven’t heard any stirrings of it ever coming back.

For whatever reason, the Marines just don’t seem all that motivated to send their personnel to school, or help them pay for previous schooling.


The Coast Guard Loan Repayment Program

The Coast Guard provides up to $30,000 in total loan forgiveness, with a maximum of $10,000 provided each year, and a minimum service contract of 3 years to become eligible for benefits.

However, anyone who has received benefits under their repayment program and then is either discharged from the service or who enlists in a different branch of the military will be forced to repay the Federal Government any money that it provided to cover the costs of their student loans.

Which is a big deal, because you could end up with a massive bill if they pay off some of your loans, but you don’t fulfill your side of the service commitment. Be careful about signing up for the benefit, then leaving early, because you’ll really regret the repercussions.


Which Student Loans Qualify for CLRP?

Not all student loan debt is eligible to be forgiven via the Military’s CLRP program, and the first major qualification requirement is that only Federal loans will be forgiven with this benefit. If you’ve got Private student loan debt, then you’ll want to look elsewhere for assistance.

Consider calling the Private Student Loan Relief Helpline (at PHONE NUMBER), or visiting my pages on Private Student Loan Relief, Private Student Loan Forgiveness Benefits, Private Student Loan Bankruptcy Discharges, and Private Student Loan Default Help for details on how to tackle private loans.

Now, assuming you do have a Federal student loan (or loans), here’s a list of the Federal loans that qualify for participation in CLRP.

CLRP Program Qualifying Loans Include:

  • Stafford Student Loans – AKA Guaranteed Student Loans (GSLs)
  • Auxiliary Loan Assistance for Students (ALAS)
  • Consolidated Loan Program loans – Forgiveness only covers the related education expenses, not other costs)
  • Parents Loans for Undergraduate Students (PLUS) – Unfortunately, these must be incurred for the use of the individual contracted to the program, and forgiveness programs cannot be used for military dependents (like spouses or children)
  • Federally Insured Student Loans (FISLs)
  • Supplemental Loans for Students (SLSs)
  • Perkins Loans – AKA National Direct Student Loans (NDSLs)

Which Loans Are NOT Eligible for CLRP?

To qualify for this program, your student loan debt must be via one of the loans included on the list above, which are all loans covered under the Higher Education Act of 1965, Title IV, Part B, D, and E.

Any loan not listed above will not be eligible for CLRP forgiveness benefits, which means that loans like private loans, state-funded loans, equity-loans and institution loans are not eligible for CLRP benefits.

To find out if your student loans qualify for participation in CLRP, please visit the National Council of Higher Education Loan Programs page and download Title IV of the Higher Education Act of 1965 to see if your loan is listed there.

One other thing to consider – any student loans that are in default also are not eligible for CLRP benefits, according to Army Regulation (AR) 621-1 and 621-202, so if you’ve already defaulted on your loans, then you’ll need to look elsewhere for financial assistance.


Who is Eligible to receive CLRP Benefits?

In addition to the loan type restrictions for CLRP, there are also restrictions on what service members are eligible to receive the benefit.

Unfortunately, just joining the military doesn’t provide automatic access to the College Loan Repayment Program, as you’ll have to be joining for the first time, extending your service contract for a set period of time, or joining the Reserves after having served in an Active Duty role, and you’ll also need to meet the eligibility requirements listed below:

CLRP Program Eligibility Criteria:

  • Those joining the military on active duty and choosing to enroll in CLRP must have no prior military experience.
  • Those joining (or reenlisting) in the Air Force or the Navy on active duty must agree to enlist for at least four years of service.
  • Those joining (or reenlisting) in the Army on active duty must agree to enlist for at least three years of service.
  • Those joining (or reenlisting) in the Army and Navy reserves, and for the Army and Air National Guard must enlist for at least six years of service.
  • For members of the Army (active duty, reserves, etc.), you must have a high school diploma (GEDs and equivalencies will not count for this program) and you must have received an overall score of at least 50 on the Armed Forces Vocational Aptitude Battery (ASVAB).
  • For members of the Army on active duty, the Army Reserves, the Army National Guard and the Air National Guard, you must enlist (or reenlist) in a shortage military occupational specialty (MOS)  or air force specialty code (AFSC) that qualifies for the loan forgiveness and repayment program. Please note that eligible MOS’s and AFSC’s change day-by-day, so make sure to speak with your local Recruiter to be certain that your chosen MOS/AFSC will be eligible for CLRP student loan forgiveness benefits.
  • For members of the Army Reserves, the Army National Guard or the Air National Guard, the maximum amount that you can have discharged varies depending on your MOS/AFSC, and on the unit that you’re assigned to. Ask your recruiter for specific information regarding these limits.
  • For members of the Army and Navy Reserves, prior service within the military will not disqualify you for participating in the CLRP forgiveness program.
  • Your participation in the College Loan Repayment Program (CLRP) must be annotated on your enlistment (or reenlistment) contract. DO NOT DISREGARD THIS! Do not trust any Recruiter who won’t specifically include it on your enlistment (or reenlistment) contract, because if they fail to include this line, you will not be eligible for any CLRP benefits. To satisfy this eligibility requirement, you will need to have your loans consolidated and have the promissory notes sent to your Recruiter before finalizing your enlistment contract.

Now, the good news is that if you do meet all the eligibility conditions above, you should be able to claim CLRP benefits, and you’ll be all set to receive tens of thousands of dollars in student loan forgiveness.

How Are CLRP Benefits Issued?

CLRP loan forgiveness payments don’t actually come to you directly, but are instead issued in your name to your lender. Basically, instead of getting a check (or cash or a direct deposit), the Federal Government issues the funds to whoever services your student loans.

The way it works is that after you enlist, and have CLRP written into your service contract, your lender will start receiving their payments directly from the Federal Government after you complete each year of service stipulated in the contract.

But keep in mind that before your first forgiveness payment is sent out, you must also have completed all of your initial entry training, including both basic training and your specific MOS/AFSC (job) training. Until this is accomplished, your lender won’t get paid, and you’ll basically not be receiving any CLRP.


How Much of my Debt Will CLRP Repay?

CLRP benefits forgive different amounts of debt, depending on whether you are an active duty servicemember, or a member of the reserves, but also depending on which branch of the military you join.

Here is the specific breakdown for how much of your debt will be forgiven each year, based on your service commitment:

CLRP for Active Duty Members

Active duty members will have 33.33% of the outstanding balance of their loan (or $1,500, whichever is greater) forgiven annually, for each year that they continue to serve in the military.

If you leave the military at any time, or even if your MOS/AFSC changes to a role that is no longer eligible for CLRP benefits, then you will lose all access to these benefits.

I recommend that you plan on closely monitoring changes to the CLRP program to ensure that you continue to remain eligible for these benefits, especially if losing them will lead you to face a financial disaster.

Along those lines, it’s a good idea to bookmark this page and return to it regularly, as I update it whenever new changes are announced.

CLRP for Reserves Members

Members of the Army and Navy Reserves will have 15% of the outstanding balance of their loan (or $1,500, whichever is greater) forgiven annually, for each year that they continue to serve in the military.

The Air National Guard offers significantly better CLRP program benefits, with 15% of the outsanding balance (or up to $5,000, whichever is greater) forgiven annually after the first year of service.

If you have significant student loan debt, and your plan to get out from under it is to join the military, then make sure to take a good long look at the Air National Guard’s forgiveness program. $5,000 of loan forgiveness each year is a substantial benefit to joining up.


Will I have to Pay Taxes on CLRP Benefits?

Unfortunately, CLRP benefits are defined by the IRS as taxable income, so even though the money is never sent to you, it will add to your annual tax liability.

Fortunately, instead of taxing you on your CLRP benefits at the end of the year, 28% of each of the forgiveness payments sent to your lender will be withheld by the Federal Government and sent to the IRS directly.

That means that you won’t actually have to pay for these taxes out of pocket, you’ll just have to notate them on your IRS paperwork when you file for taxes.

Once your participation in the CLRP program begins, the military will issue you a separate W-2 statement each year that includes a line containing your CLRP benefits. You’ll need to save this W-2 and use it when filing your taxes with the IRS.

Can I Use CLRP And Post 9/11 GI Bill Benefits?

Unfortunately, Congress did not make it possible to collect CLRP benefits alongside those that you would receive from the Post 9/11 GI Bill (unless you agree to sign up for a longer service agreement).

To try and entice people joining the military to enroll for longer periods of time, you cannot be eligible for both CLRP benefits and the Post 9/11 GI Bill with the minimum enlistment period (4 years).

Instead, the only way to begin building eligibility for both the CLRP program and the new GI Bill benefits is to enroll in a service contract of at least 6 years.

According to this forum post on Military.com, if you sign up for a 6 year enlistment, the first 3 years will count toward your CLRP benefits, and the last 3 years will make you eligible for the Post 9/11 GI Bill.

I’ve verified that this works over the years with responses from service personnel, so I’m quite comfortable in recommending the 6 year enlistment process as your best option for attacking your student loans and wiping them out as quickly as possible.

However, I would make sure to discuss this with your recruiter, and get it all included in writing on your service contract. It should specifically state that you’re eligible for BOTH the College Loan Repayment Program AND the Post 9/11 GI Bill, otherwise you may get screwed out of the benefits down the line.

Make absolutely certain that you get everything from your Recruiter in writing before signing your contract, as word of mouth will not hold up in any kind of disagreement that results later on when you attempt to actually claim and use your benefits.


Do CLRP Payments Cover Interest on My Student Loans?

Unfortunately, another limitation of CLRP benefits is that they will not pay for the interest you’ve accrued on your student loans.

Instead, CLRP will only provide you with repayments based on a calculation that includes the unpaid principal balance of your loans.

From various forum conversations around the web, it appears that there is significant confusion regarding whether or not CLRP pays for interest, and how that affects those enrolled in the program.

It is clear, however, from reviewing it’s official description, that “The College Loan Repayment Program only pays on the unpaid principal balance. It does not pay for any interest accrued.”

One way to prevent this lack of coverage from significantly increasing the long-term cost of your loan is to request that your lending institution defer payments on your student loan while you’re serving on active duty (obviously this only works if you are, in fact, serving on active duty).

If your student loan is exempt from incurring interest charges while it’s being deferred (which Stafford Loans and Federal Perkins Loans are), and you’re able to get your lender to defer payments, then you won’t face an interest build up for as long as you can retain that status, even while your CLRP benefits are paying off the principal of your loan.

Before you request deferment to reduce your interest liability, make sure to speak to your lender to find out whether or not your loan qualifies for deferment in the first place, and whether or not that would prevent you from accruing additional interest on the loan.

Additional Eligibility Rules for Continued Participation

To remain eligible for the CLRP program after your lender receives their first loan forgiveness payment, you’ll need to maintain the following responsibilities:

  • You will have to remain on enlisted active duty while you are enrolled in the program (if you began it while enlisted and on active duty).
  • You will have to keep your CLRP eligible loans in good standing (if they go into default or if you have delinquent payments, this will ruin your eligibility and prevent you from receiving further benefits).
  • You must continue to pay all loan fees (anything other than the original principal balance) and all interest accrued by your loan, although you might be able to avoid that interest by choosing to defer your loan payments (as outlined above).

Failing to satisfy any of the requirements above can and most likely would result in losing the benefits, so be careful about this when you start getting the benefit.


For Additional Information

Save yourself tens of thousands of dollars on future education expenses by viewing my Guide to Military Education Benefits.

This Guide will teach you all about the Post 9/11 GI Bill, the Yellow Ribbon Program, Basic Allowance for Housing, Military Tuition Assistance Programs, and even Military Spouse Benefits (which are exceptional!).

Please Help

If this page helped you to better understand the Military College Loan Repayment Programs, then please considering helping me out by spreading the word that it exists.

Post it to Facebook, Twitter, Google+, or anywhere else that you think it makes sense to share, and help me make more people aware of CLRP benefits!

Thank you for visiting, and thank you so much for your support. I really do appreciate it.


Disclaimer: This post is NOT sponsored content as I don't accept any form of sponsored posts, advertorials, native advertising, influencer marketing or incentivized, paid or promoted content. However, this post may contain affiliate links. If you purchase a product or service linked to from this post, I will receive some form of compensation.

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Tim's experience struggling with crushing student loan debt led him to create the website Forget Student Loan Debt, where he offers advice on paying off student loans as quickly, and cheaply, as possible. His new website Forget Tax Debt, offers similar advice to people with back tax problems.

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Comments

  1. Michelle Seibert says:

    My son is a 3 year army rotc scholorship winner at the University of Kentucky in Lexington Kentucky. I took out a parent plus loan for his first year in my name. Will the loan forgiveness for the army not happen since it’s in my name?

    • Hi Michelle,

      Parent Plus Loans are a tricky subject. You need to contact the Student Loan Ombudsman Group to find out if there will still be coverage for these loans, as I’m not entirely sure. Please do me a huge favor and come back to let me know what they told you after you find out. I want to create a new page on Parent Plug Loans where I can provide this sort of information, because it comes up every once in a while as a question and I’m simply not sure about the answer.

      The Student Loan Ombudsman Group is NOT a private company, btw, and won’t charge you anything for their consultation. This is a group of attorneys that offer pro bono legal services for the Federal Government. You can trust them, and you can believe the answer they give you.

  2. Im joining the navy and I have a few questions about the College Loan Repayment Program. I spoke to a recruiter the other day and he told me in order to qualify for the CLRP I would have to get an 80 or above on my ASVAB test. He also told me only curtain jobs in the navy provide the College Loan Repayment Plan. Im kinda confused because on here its saying that it’s available to ALL active duty enlisted personnel and qualifying for this program requires signing up to serve at least four years. Is this information true??

    • Hi Em,

      Sounds like they’ve changed the eligibility guidelines for CLRP. It’s possible that the information on my page is outdated. You will want to listen to what the Recruiter says, not what my site says. I’ll try and get updated information if I can find it – I don’t want to steer anyone the wrong direction.

  3. Rachel Sutton says:

    Can the federal government take our tax income to pay for student loan dept that the national guard army contract agreed to pay off. These loans are from 2004-2006. Not only has the loans not been paid in a long time, but since they are only paid twice a year they have ruined a soldiers credit score. And now the IRS has seized our income tax to pay for them.

    • Hi Rachel,

      The Federal Government (via the IRS) can do basically anything that it wants.

      You need to find out why your loans haven’t been getting paid off though. Since you’re facing real and immediate financial distress (having money taken from you), and are stuck in a difficult situation, I would recommend contacting the Federal Student Aid Ombudsman Group, who may be able to help you sort all this out.

      You can reach them at 1-877-557-2575.

      They are like legal advisers who are fully up to date on all things related to student loans, and they’ll be by far your best option for figuring out your rights and options for how to proceed.

  4. Is the Repayment program available for those who have an Associates degree and wish to join the military as officer?

    • Hey Rafael,

      For the latest information, please speak with a recruiter from whichever branch of the military you’re interested in joining. I’ve been receiving mixed messages lately about the availability of these benefits, and I don’t want to offer any outdated advice.

  5. Bryant Clayton says:

    They say that in the Army, the pay is mighty fine….

    The LRP only covers 60% of all loans up to $65,000. I was enrolled in the LRP, and the final payment was made in March of this year(2014). I had $37,000 in student debt at the start, and after all was said and done, I still have a little over $16,000. According to AR 601-210, a 33.3% payment was made every year for three years, but $4000 of each $12,000 payment was withheld, and incorporated into my taxes as income. In essences, my loans were payed with a pre-tax check, holding me responsible for for the post-tax results. So after uncle Sam “payed my loans”, I’m still responsible for 40% of them. I was lucky enough to get a military deferment. If that wouldn’t have happened, I would be looking at a $417.22 loan payment that was due last week; and on an E-4 salary with a family of four, we would have reached a breaking point. This was blatant false advertising. Even with a thorough read of my contract, these facts were not evident at the time, nor were they evident three years later. I had to have it explained to me by a very apathetic individual at HRC, who used a Jedi mind trick to reassure me that my loans had been payed. When I sent her a screen shot of my bill from fed-loan-servicing, she gave me an AR reference, and insisted that they indeed had been.

    • Hi Bryant,

      Uncle Sam always gets their cut of whatever benefits get doled out. It’s similar to President Obama’s Loan Forgiveness Program – sure, the full remaining balance of your student loan debt will get forgiven once you’ve made 20 years worth of full, on-time, scheduled payments, but you’ll still have to pay taxes on the amount that was forgiven, and all at once.

      I’m sorry to hear that the benefits weren’t fully explained to you. I want to believe that recruiters and advisers are doing everything they can to keep military personnel fully informed about the reality of the benefits packages being offered, but stories like yours have left me pretty skeptical of their motives.

      Wish I had some advice or information that could help you out, but I don’t think there’s anything you can do other than keep paying as much as you can afford each month.

    • I can confirm Bryant’s issue. I had the same problem, but with more student loan debt. I also had two payments in one tax year, thereby raising my income and tax bracket by 40k.

      If I have any advice for people, is to look into state exception from taxes for military. Some states will refund your taxes if you served in the military for that period and did not visit your home state for more than 30 days or so. For me, this was good for a few thousand back after tax time.

      For federal taxes, i don’t know of any such exemption. But, getting that state tax back was good for maybe half of that 40% that you end up paying yourself.

      They didn’t pay as much as I thought, but 60% plus state tax refunds are still a pretty good benefit. Don’t forget, if you do 6 years active duty, you qualify for full GI Bill too.

      • Wow Patrick!

        Thank you for that excellent piece of advice! The tax refund for not being in your home state for over 30 days sounds like a massive benefit.

        This site isn’t really specifically set up to cater to military personnel, but I’m going to try and find a way to work that into our content to make more service members aware of the benefit.

        Thank you so much for sharing your knowledge with us!

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