If you’re on active duty, you can pause payments on your federal student loans through a military student loan deferment. You apply by sending your loan servicer the Military Service and Post-Active Duty Student Deferment Request form along with a copy of your military orders. Two versions of the deferment exist, interest keeps growing on some of your loans while payments are paused, and a separate law caps your interest rate at 6% during service. Sorting through those pieces before you apply is what keeps a deferment from quietly costing you money.
The Two Types of Military Deferment
Federal rules offer two deferments, and the one that fits depends on what you were doing before you were called up.
Military Service Deferment
This covers you during active duty connected to a war, military operation, or national emergency. It also applies to full-time National Guard duty authorized by the President or Secretary of Defense, and to National Guard members activated under state authority for more than 30 consecutive days.1Federal Student Aid. Military Service and Post-Active Duty Student Deferment Request The deferment runs through your qualifying service and continues for 180 days after you finish.2Federal Student Aid. Student Loan Deferment Reserve and retired members called up under certain federal statutes also qualify. The common thread is that your service must be tied to a contingency operation, national emergency, or war.
Post-Active Duty Student Deferment
This one is for service members who were enrolled in school at least half-time when called to active duty, or within six months before activation. It starts after your active duty ends (plus any applicable grace period) and lasts until you re-enroll at least half-time or 13 months pass, whichever comes first.2Federal Student Aid. Student Loan Deferment The form asks you to identify the school and your last date of at least half-time attendance.1Federal Student Aid. Military Service and Post-Active Duty Student Deferment Request
You can request both on the same form. A student called to active duty would check both boxes to get continuous coverage from the start of service through the return to school.
Which Loans Are Covered
Military deferment applies to federal student loans across the three major programs: Direct Loans, Federal Family Education Loans (FFEL), and Federal Perkins Loans.1Federal Student Aid. Military Service and Post-Active Duty Student Deferment Request Consolidation loans that include subsidized and unsubsidized portions are also eligible, with each portion treated under its own interest rules.2Federal Student Aid. Student Loan Deferment
Private student loans are not covered. Some private lenders run their own military relief programs, but those vary by lender and aren’t guaranteed. If you carry both federal and private loans, you’ll handle them separately.
How Interest Works While Payments Are Paused
Interest is where deferment gets expensive if you aren’t paying attention. The rules split cleanly by loan type.
On subsidized loans, you’re not responsible for interest that builds up during deferment. That includes Direct Subsidized Loans, Subsidized Federal Stafford Loans, Federal Perkins Loans, and the subsidized portions of consolidation loans.2Federal Student Aid. Student Loan Deferment Your balance stays flat.
On unsubsidized loans, interest keeps accruing the entire time you’re in deferment. This applies to Direct Unsubsidized Loans, Direct PLUS Loans, FFEL PLUS Loans, and unsubsidized consolidation portions.2Federal Student Aid. Student Loan Deferment If you don’t pay that interest as it accumulates, it gets added to your principal when the deferment ends. That process is called capitalization.3Consumer Financial Protection Bureau. What Is Student Loan Deferment? After that, you’re paying interest on a larger balance going forward.
Perkins Loans are the exception. Interest on those never capitalizes.4Federal Student Aid. Federal Student Aid Interest Rates and Fees For everything else, paying even the monthly interest on your unsubsidized loans while you’re deployed can meaningfully reduce what eventually gets added to principal.
How to Apply
The paperwork itself isn’t complicated. The details are what trip people up.
Fill Out the Deferment Request Form
You need the Military Service and Post-Active Duty Student Deferment Request form, available on the Federal Student Aid website or from your loan servicer.2Federal Student Aid. Student Loan Deferment The form asks which deferment type you’re requesting, the exact start and end dates of your qualifying service, and whether that service is connected to a contingency operation, national emergency, or war.1Federal Student Aid. Military Service and Post-Active Duty Student Deferment Request
Attach Proof of Service
Acceptable documentation is a copy of your military orders or a written statement from your commanding or personnel officer.5Federal Student Aid. Military Service and Post-Active Duty Student Deferment Request If your service is ongoing and you don’t have orders showing a firm end date, send what you have and update your servicer later. Your servicer is required to help you through this at no charge.1Federal Student Aid. Military Service and Post-Active Duty Student Deferment Request
Send It to Your Servicer
Submit the completed form and documentation to the company that services your federal loans. Most servicers accept mail, fax, or online submissions. If you have loans with more than one servicer, send a separate request to each. You can find your servicer by logging into your account at studentaid.gov.
Deploying soon? Consider granting a trusted family member a power of attorney so they can handle the paperwork if something needs to be updated while you’re overseas. Military legal assistance offices on base can set this up before you leave.
Keep Paying Until It’s Approved
Don’t stop making payments until your servicer confirms in writing that the deferment is in place. Skipping this step is the mistake that causes the most trouble. Stop paying too early and those missed payments can be reported as delinquent.
Servicers can grant up to 60 days of administrative forbearance while they process your deferment request, and interest that accrues during that processing window cannot be capitalized.6U.S. Department of Education. Federal Student Loan Fact Sheet – Grace Periods, Deferment, and Forbearance Once your deferment is granted, it’s usually backdated to the start of your qualifying service. Any payments you made during that overlap may be refunded or applied to your principal.
When Deferment Ends
Repayment resumes automatically. For military service deferment, that’s 180 days after qualifying service ends. For post-active duty student deferment, it’s when you re-enroll at least half-time or 13 months pass.
This is the moment when unpaid interest on unsubsidized loans capitalizes. Once that accrued interest is added to principal, your new monthly payment is calculated on the higher balance.4Federal Student Aid. Federal Student Aid Interest Rates and Fees On a large unsubsidized balance, a multi-year deployment can add thousands of dollars to what you owe.
If your finances have changed during service, contact your servicer before repayment restarts. An income-driven repayment plan sets your payment based on what you actually earn, which may be significantly less than what you were paying before deployment. You aren’t stuck with whatever plan you were on before deferment.
The SCRA 6% Interest Rate Cap
Separately from deferment, the Servicemembers Civil Relief Act caps interest at 6% per year on debts you took out before entering active duty, including student loans.7Office of the Law Revision Counsel. United States Code Title 50 – 3937 Maximum Rate of Interest on Debts Incurred Before Military Service Any interest above 6% is forgiven outright, not deferred or added on later.8Department of Justice. 6% Interest Rate Cap for Servicemembers on Pre-service Debts Your monthly payment must also be reduced to reflect the lower rate.
For federal student loans, your servicer likely applies this automatically. Federal loan servicers check the Department of Defense’s Defense Manpower Data Center to identify eligible borrowers and apply the reduction without you having to ask.9Federal Student Aid. Servicemembers Civil Relief Act (SCRA) Interest Rate Limitation Request Mistakes happen, so verify your rate in your servicer’s online portal. If it hasn’t been reduced, submit a request with your military orders.
For private loans and other pre-service debts, the SCRA cap is not automatic. You must send written notice and a copy of your military orders to each creditor. The statutory deadline is 180 days after your military service ends.7Office of the Law Revision Counsel. United States Code Title 50 – 3937 Maximum Rate of Interest on Debts Incurred Before Military Service Miss that window and the protection is gone.
The two protections stack. If you defer your unsubsidized federal loans during active duty, interest still accrues, but SCRA limits that accrual to 6% instead of whatever higher rate your loans carry. On a $50,000 unsubsidized balance at 7.5%, that difference is real money over a multi-year deployment.
Before You Defer: The PSLF Trade-off
Active duty military counts as qualifying public service employment for the Public Service Loan Forgiveness program. If you make 120 qualifying monthly payments on Direct Loans while working for the federal government (which includes all military branches), your remaining balance is forgiven.10Federal Student Aid. Public Service Loan Forgiveness (PSLF) Help Tool
Months spent in deferment or forbearance generally do not count toward those 120 payments, because you aren’t making payments during those months.10Federal Student Aid. Public Service Loan Forgiveness (PSLF) Help Tool That creates real tension. Deferment protects you from payments during deployment, but it also pauses your progress toward forgiveness. For service members planning a full military career, enrolling in an income-driven repayment plan may make more sense than deferring. A $0 monthly payment under an income-driven plan still counts as a qualifying PSLF payment if you meet the other requirements.
The PSLF Buyback program offers a partial fix. Borrowers who missed payments due to deferment or forbearance after 2007 can make retroactive payments for those months once they’ve reached 120 months of qualifying employment. You’d pay what you would have owed under an income-driven plan for each missed month, and those months then count toward your 120.
If you’re pursuing PSLF, talk to your servicer before choosing deferment. Depending on your loan balance, income, and how close you are to 120 payments, staying in an income-driven plan during active duty could get you to forgiveness faster than pausing everything.