Tuesday, September 25, 2001

Education Department Suspends Loan Obligations for Students Fulfilling Military Duty By STEPHEN BURD Washington The U.S. Education Department announced on Monday that it had directed lenders to assist student-loan borrowers who have been activated for military duty as a result of the recent terrorist attacks by temporarily suspending their loan obligations. The secretary of education, Roderick R. Paige, also called on colleges to refund tuition and other institutional charges to students who are forced to withdraw from their institutions to fulfill their military obligations. The department's actions were aimed at helping members of the National Guard and the military reserves. "The young men and women who serve our country have an enormous job to do in the coming months," said Mr. Paige. "The actions we are taking today will ease their financial burdens as they defend our country in these challenging times." Under the department's direction, student-loan borrowers will not have to make payments while on active duty, and the federal government will assume the interest payments on borrowers' subsidized loans while they serve. Military personnel called to active duty whose loans are not yet in repayment -- because they are students or have only recently left college and are therefore in a grace period -- will receive deferments on their loans, meaning that they will not have to make payments and interest won't accrue while they serve. The department also announced that it would exempt needy students who are called for military service, or who withdraw as a direct result of the terrorist attacks, from rules that require those who drop out of college to repay student aid they have not used. In addition to encouraging colleges to provide full refunds to students who leave college to serve in the military, the education secretary urged colleges to offer flexible re-enrollment options to those students and to others who have been forced to withdraw as a result of the terrorist attacks. "Many people's families and livelihoods have been dramatically changed by recent events," said Mr. Paige. "I hope the nation's colleges and universities will give people time and flexibility to return to their normal routines and activities." Easy-to-print version E-mail this article

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