Myth: I can't serve if I have student loans

Luckily, there are many benefits and tools for managing your student loans during your Peace Corps service and plenty of Volunteers are able to serve with student loans.

Along with reviewing the Student Loan page on the Peace Corps website, one of the best things you can do is contact your lender directly. You should feel empowered to make that call even before you apply! Once you get someone on the phone here are 4 questions that can help you navigate a conversation with your lender.

1. What type of student loan(s) do I have?

This seems basic, but you want to be 100% sure of your student loan type because it will determine what options you have available to you.

2. What options are available to me during or after my Peace Corps service?

Some loans can qualify for an income-based repayment plan. As Volunteers do not make a significant income, the monthly payment during service could be $0.

Some federal loans qualify for deferment, meaning you wouldn’t need to make payments on your student loans during your Peace Corps service. However, depending on the type of loan, interest may still accrue.

Perkins loans may qualify for a 15 to 70% cancellation benefit.

Federal direct loans qualify for loan forgiveness through a program called Public Service Loan Forgiveness (PSLF). It’s important to carefully read through the details of this program. For some, this could shave off years of student loan payments.

Private loans may offer some loan relief options, but that at the discretion of the lender. If you do need to make payments on a student loan during your service, you can use part of the readjustment allowance that you accrue each month during service to make direct payments to your lender.

Regardless of the benefits your lender may provide, you have the ability to make monthly loan payments through early withdrawals from your readjustment allowance during service. For more information, see Finance FAQs.

3. What forms do I need to complete for a qualifying payment plan?

Required documentation varies greatly. Getting things in writing is not only helpful for your own peace of mind but can also be critical for holding your lender accountable to what they tell you.

4. Can someone I trust can communicate with my lender while I'm out of the country?

Consider the communication challenges during your Peace Corps service. Spotty internet connections, time zone differences, and international call rates can all make having a power of attorney (POA) extremely convenient during your service. A lawyer must set up a POA, and it’s usually easier to do this prior to entering service. Volunteers can list a financial information contact during the onboarding process, but this is not the same as a POA.

Ultimately your student loans are your responsibility. The Peace Corps does not pay your loans during service and cannot defer your loans for you.

You should also consider the career and financial benefits that accompany Peace Corps service, which can ultimately have a positive impact on your student loans. Reach out to your lender to determine what options are available if you decide to serve in the Peace Corps.