| Mr. Carl W. S. Chun | Director | |
| Mrs. Nancy Amos | Analyst |
| Mr. John N. Slone | Chairperson | |
| Mr. Melvin H. Meyer | Member | |
| Mr. Roger W. Able | Member |
2. The applicant requests reimbursement of all her student loans.
3. The applicant states that when she entered the Army she asked if all her loans were eligible for the Loan Repayment Program (LRP). Her recruiter and her guidance counselor at the Military Entrance Processing Station (MEPS) all assured her that her loans qualified. She had all of her paperwork in so there was no question as to the nature of her loans. She provides a sworn statement from her recruiter supporting her request.
4. The applicant’s military records show that she entered the Delayed Entry Program on 9 November 1999. Her Statement of Understanding, United States Army Incentive Enlistment Program, DA Form 3286-66, shows that she enlisted for the LRP for an amount not to exceed $65,000. On this form, she acknowledged that under the LRP the government would repay a designated portion of any loan she incurred that was made, insured or guaranteed under Part B of the Higher Education Act of 1965 or any loan under Part E of such act after 1 October 1975 and before she enlisted into the Regular Army. She enlisted in the Regular Army on 20 January 2000. Prior to entry on active duty, she had obtained two Citibank CitiAssist Undergraduate Loans in the amounts of $9,667.00 and $5,000.00 (for a total amount of $14,667.00).
5. The Education Incentives Branch, U. S. Total Army Personnel Command has verified that they have processed one qualifying loan so far on the applicant for $16,334.00.
6. On 14 February 2001, the applicant’s recruiter made a sworn statement that he enlisted her with the understanding that her student loans would qualify for the LRP. He made sure that all the paperwork was in order and in her packet. At the MEPS the guidance counselors checked her packet and verified that her college loan paperwork did in fact qualify for the LRP. She enlisted in good faith expecting that her loans would be paid.
7. The Loan Repayment Program is a Department of the Army enlistment option authorized by Public Law 99-145. This option is designed to increase Test Score Category I-IIIA accessions. Loans that qualify for repayment are Guaranteed Student Loan/Stafford Loans, National Direct Student Loan/Perkins Loans, William D. Ford Loans, Supplemental Loans for Students, Federally Insured Student Loans (FISL), Parent Loan for Undergraduate Students (PLUS), Auxiliary Loan Assistance for Students (ALAS), and consolidated loans which fall under Title IV, Part B or E of the Higher Education Act of 1965, or William D. Ford Loan. Before entering active duty, the loan must not be in default. The borrower is responsible for obtaining a deferment/forbearance with the loan holder and the loan must remain in good standing throughout the repayment process. Active Army LRP participants earn their first loan repayment after completion of a full year of active duty and for each full year thereafter, up to 3 years. Payment of 33 1/3 percent or $1,500, whichever is greater, is authorized annually to the loan holder on the total remaining original outstanding principal balance.
8. The Government will not make any payments to the soldier or reimburse a soldier if he or she pays off a student loan. The Government will only pay the lending institution.
9. Title 10, U. S. Code, section 1552, the law which provides for the Board, states that “The Secretary may pay, from applicable current appropriations, a claim for the loss of pay, allowances, compensation, emoluments, or other pecuniary benefits, or the repayment of a fine or forfeiture, if, as a result of correcting a record under this section, the amount is found to be due the claimant on account of his or another’s service in the Army, Navy, Air Force, Marine Corps or Coast Guard, as the case may be.”
CONCLUSIONS:
1. The evidence of record shows that the applicant enlisted in the Regular Army in good faith for the Loan Repayment Program incentive on 20 January 2000 up to a maximum amount of $65,000.00. She had obtained several student loans prior to her entry on active duty and they were not in default prior to her entry on active duty. Her recruiter has provided a sworn statement indicating that she was told by him and by guidance counselors at the MEPs that her loans qualified for the LRP. She was later informed that two of those loans did not qualify for repayment under the LRP.
2. The applicant’s military records may be corrected to show her DA Form 3286-66 was amended to include the sentence “If a student loan is accepted by the officials processing you for enlistment as payable under the LRP and it is later discovered that it is not payable for reasons of law or regulation, the Army Board for Correction of Military Records may pay the loan, at its sole discretion, in accordance with Title 10, U.S. Code, section 1552.” This would allow the Board to invoke that provision and pay her the amount her lending institution would have been paid under the LRP.
3. In view of the foregoing, the applicant’s records should be corrected as recommended below.
RECOMMENDATION:
1. That the applicant’s DA Form 3286-66 be amended to include the sentence “If a student loan is accepted by the officials processing you for enlistment as payable under the LRP and it is later discovered that it is not payable for reasons of law or regulation, the Army Board for Correction of Military Records may pay the loan, at its sole discretion, in accordance with Title 10, U.S. Code, section 1552.”
2. That in accordance with Title 10, U. S. Code, section 1552, the Defense Finance and Accounting Service shall remit payment to the applicant of $14,667.00, the principal amount of her Citibank CitiAssist Undergraduate Loans, as a result of the above correction. Payments will be made in one-third increments commencing with the applicant’s completion of her first full year of active duty and for each full year thereafter, up to 3 years.
3. In no instance will repayment of the total amount of the applicant’s student loans, either normally payable under the LRP or under the provisions of Title 10, U. S. Code, section 1552 exceed $65,000.00.
BOARD VOTE:
___jns__ __mhm___ __rwa___ GRANT AS STATED IN RECOMMENDATION
________ ________ ________ GRANT FORMAL HEARING
________ ________ ________ DENY APPLICATION
John N. Slone
______________________
CHAIRPERSON
| CASE ID | AR2001051600 |
| SUFFIX | |
| RECON | |
| DATE BOARDED | 20010227 |
| TYPE OF DISCHARGE | |
| DATE OF DISCHARGE | |
| DISCHARGE AUTHORITY | |
| DISCHARGE REASON | |
| BOARD DECISION | (GRANT) |
| REVIEW AUTHORITY | |
| ISSUES 1. | 128.14 |
| 2. | |
| 3. | |
| 4. | |
| 5. | |
| 6. |
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