FAQs

Finance

Can I have debt of any sort (e.g., tuition for my children, credit card debt, mortgage) and still serve in the Peace Corps?

You can serve in the Peace Corps with outstanding financial obligations if you can show that the debts can be managed and/or paid in a timely way during service. If you plan to have another person assume responsibility for making payments on a debt, an original copy of a notarized statement from that person acknowledging his or her responsibility is required. Additionally, you may include an allotment or multiple allotments up to 75 percent of your gross monthly allowance from your Volunteer readjustment allowance when making debt payment plans. This allotment is not available until the trainee is sworn in as a Volunteer. These allotments must be paid directly to the company that holds the debt. For student loan debt, you should contact the lender directly to see if they offer any relief or deferment plans.

Can interest accrue on deferred loans?

In some cases, yes. Check with your lender(s) to discuss what will happen with your loans once they are deferred. Volunteers might have to pay interest on unsubsidized loans during service, including Stafford Loans, Federal Consolidation Loans that include unsubsidized loans, and Federal Direct Loans. After your training, you may authorize payments of up to $243.75 (at this time) per month from your readjustment allowance to cover interest due on your student loans.

I am still within my grace period for my student loan, and haven't started making payments yet. Should I fill out the student loan form and send it anyway?

You should always contact your lender to find out when they will accept your application for a student loan request, e.g. deferment. If your lender says you must wait until the six-month grace period expires, wait until that time. Bring extra forms with you and have an official in-country sign them or leave the forms with your power of attorney to have the forms completed by headquarters (certify@peacecorps.gov).

I have a house and/or financial obligations in the U.S. What's the best way to maintain them?

You may want to discuss with an attorney the possibility of giving a relative or friend power of attorney to handle your financial matters, along with an accountant to file your taxes while you are serving abroad. Keep in mind that your monthly living allowance and readjustment allowance are considered taxable income, so W-2 forms will be sent to your in-country worksite. You can either file your taxes from overseas or send them home, along with other income records, to be filed by someone else. As a Volunteer, you may be granted an extension on the tax filing date. Consult your tax adviser for additional information.

I was told that I need to reapply for deferment of my student loan after one year. Can my parents (or another family member) do that for me? What do I need to do?

To reapply for deferment of your student loan during your service, you will need to designate someone to have access to your information. To do this, fill out the Privacy Waiver included in your invitation and submit it during staging.The designated party should request loan deferment paperwork from the Peace Corps Volunteer & PSC Financial Services to request the appropriate documentation for your student loan request at this address: Peace Corps Headquarters Attn: Certifying Officer, CFO/VPS 1111 20th St. NW, Second Floor, Washington, DC 20526. Contact 855.855.1961 ext. 1784 or certify@peacecorps.gov for more information. Note: The Privacy Act Waiver gives the Peace Corps the ability to discuss and release financial information to a family member or friend who you designate. The Privacy Act Waiver is different from a power of attorney. A lender will mostly likely need you to assign a power of attorney for someone to speak to them on your behalf. Applicants to Peace Corps Response should speak to a recruiter for their options.

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