This bill ensures that qualifying service years for National Guard and Reserve members count toward Federal Direct Loan forgiveness, even if they weren't in public service employment during those payment months.
Seth Magaziner
Representative
RI-2
The National Guard and Reserve Student Loan Fairness Act simplifies student loan forgiveness for members of the military reserves. It mandates that qualifying years of service, based on points earned toward retired pay, automatically count as qualifying payments toward Federal Direct Loan forgiveness programs. This change applies even if the borrower was not working in public service during those payment months. The Departments of Defense and Education must coordinate data to ensure these payments are counted without requiring extra paperwork from the service member.
New Bill Automates Student Loan Forgiveness Credit for National Guard and Reserve Members
The “National Guard and Reserve Student Loan Fairness Act” is designed to make sure military reservists get proper credit for their service when trying to qualify for Public Service Loan Forgiveness (PSLF). If you’re in the Guard or Reserves and have Federal Direct Loans, this bill is a game-changer for how your years of service count toward the 120 required payments for forgiveness.
Counting Service While You’re Not on Active Duty
Right now, qualifying for PSLF means you need to be working full-time for a government or non-profit organization while making your payments. This bill creates a special carve-out for reserve members who make their required loan payments while fulfilling their military obligations. It essentially treats their service time as if they were employed in a qualifying public service job for student loan purposes, even if their day job is, say, coding software or running a plumbing business.
This credit is tied directly to the points earned toward military retirement (Section 2). If you earn a full year of covered service (80 or more retirement points), every single month in that year counts as a qualifying payment. If you complete a partial year (between 50 and 79 points), up to six months can count. This is a massive simplification, recognizing that reserve service is a public service commitment regardless of your civilian employment status.
The End of the Paperwork Nightmare
One of the biggest headaches with PSLF is the constant need to submit employment certifications—a process that often involves tracking down HR departments and dealing with mountains of red tape. The bill addresses this head-on by mandating that the Department of Defense (DoD) and the Department of Education (ED) must share data (Section 2).
Within one year of the bill passing, these agencies must automatically cross-reference their records to identify every reserve member who made loan payments while serving. The goal is to credit these qualifying payments without the service member having to submit extra paperwork or verification. This shift from a borrower-driven verification system to an automated, government-driven one could save countless hours and prevent errors that often derail forgiveness applications.
Real-World Impact: Time is Money
For a busy reservist juggling civilian work, family life, and monthly drills, this automation is huge. Imagine a National Guard member who works as an electrician during the week. Under current rules, their loan payments only count if they fill out specific paperwork proving their employer is PSLF-eligible. This bill says: If you served your time and earned your points, those loan payments count, period. This provision acknowledges the immense time commitment required by reserve service and finally gives those service members the credit they deserve toward easing their student debt burden.