Just scored VA EDRP, wanting to confirm how this works....

[FredBerfil]

Hello everyone, I haven't been here in a long time! Currently in my 15th year at the VA. I have five figures of student loan debt still following me after all these years so I was pleased that EDRP was finally offered to me, will wipe out my remaining balance. Thank goodness.

However, I just wanted to double check the details.

Main thing I wanted to double-check is the whole reimbursement aspect of this. The main issue is that the annual amount that my EDRP is approved for is about three times the amount I pay out per month on my loan (because the APR on my loan is quite low - under 2%).

Given that, it seems like I will need to increase the amount I pay out in order to take maximum advantage of the annual EDRP approved amount, correct? In other words, I do not get reimbursement payments for money I did not "front" in the first place?

Thanks, appreciate the confirmation from anyone else who has taken advantage of this and if y'all have any other tips that would be appreciated.

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[Big5Club]

Hello everyone, I haven't been here in a long time! Currently in my 15th year at the VA. I have five figures of student loan debt still following me after all these years so I was pleased that EDRP was finally offered to me, will wipe out my remaining balance. Thank goodness.

However, I just wanted to double check the details.

Main thing I wanted to double-check is the whole reimbursement aspect of this. The main issue is that the annual amount that my EDRP is approved for is about three times the amount I pay out per month on my loan (because the APR on my loan is quite low - under 2%).

Given that, it seems like I will need to increase the amount I pay out in order to take maximum advantage of the annual EDRP approved amount, correct? In other words, I do not get reimbursement payments for money I did not "front" in the first place?

Thanks, appreciate the confirmation from anyone else who has taken advantage of this and if y'all have any other tips that would be appreciated.

From a recent post I saw, I believe that you submit your payments over the previous year and they reimburse you for the amount you paid.

I’m curious. You mention 15 years with the VA. Did you try to get PSLF?

 

[summerbabe]

Main thing I wanted to double-check is the whole reimbursement aspect of this. The main issue is that the annual amount that my EDRP is approved for is about three times the amount I pay out per month on my loan (because the APR on my loan is quite low - under 2%).

Yup so say you are granted $10,000 of EDRP for year one which runs from 2/1/22 to 1/31/23, you'll be reimbursed for whatever you pay toward your loans during that year span. If you end up paying $8000, you'll get a lump sum direct deposit for $8000 after you submit paperwork/receipts and that other $2000 is expired (I think, not sure if this impacts future EDRP reimbursement). Or if you pay $12,000, you'd still only get $10,000 back.

Also, during the approval process, you'll get to determine your reimbursement limits for each year you are EDRP eligible so you could decide to pay less year one and more in years 2+ (which the lump sum can help cover).

 

[AcronymAllergy]

Yes, you're only reimbursed for money you've actually paid over the preceding year. Which means that you essentially front the money for the year, then submit proof of payment to VA (e.g., you can have the loan servicer complete a VA form verifying what you've paid, you can submit bank and loan statements and/or check images, etc.) and VA reimburses you in a lump sum amount. Each year when you're getting ready to file your payment claim, you should receive forms that show you what you're approved for that year and all subsequent years (usually the same amount each year).

If you underpay what you're approved for by a certain amount for that year, I think VA can reduce the amount of your future payments by a certain percentage. But I'm not sure how often this happens.

Also, the payments don't necessarily have to be only regular monthly payments. For example, you could pay your regular monthly payments for the year, see that you're maybe $5k under your reimbursement cap, and then submit an extra $5k lump sum payment. So long as that lump payment posts to your loan before your annual cut-off date, you can be reimbursed for it.

Edit: Also, if you go without paying for a year for whatever reason, you're removed from EDRP.