Mar 23, 2013 Sean Albert
One of the perks of being a member of the Unites States Armed Forces is the fact that soldiers are treated to a free education at state universities. This way, the road is paved for success in the future, whether they choose to specialize in a field within one of the military branches or they are deciding what they want to do after their last tour is finished.
However, because of a few obstacles in the recent past, some service men and women have had to look to alternative funding sources for their education. In 2012, there was a data breach issue, while more recently, the financial situation and budget cuts have left some lawmakers advocating for less education assistance for those in the Armed Forces. Alternative funding for loans might be just the thing that members of our military need to pay for their education or other necessary expenses.
Army freezes applications for tuition assistance
According to Inside Higher Ed, the U.S. Army recently revealed that it had put a freeze on all new applications for tuition assistance, something that has been relied upon to fund post-secondary schooling for soldiers for some time. Department of Defense Comptroller Robert Hale suggested that this should be one of the first ways to trim the fat in the wake of nationwide budget and spending cuts. The news outlet said not only is the Army doing this, but the Marine Corps became the first branch to do so at the beginning of March, while the Air Force and Navy are considering greatly reducing the program.
Inside Higher Ed reported that service men and women who are already in school and enjoying funding won't be affected, but the same cannot be said to those who have already applied and not yet received confirmation.
The source said that many colleges are taking the matter into their own hands, looking for alternative funding sources for student soldiers.
The news outlet explained that some state colleges are looking into educating students about the G.I. Bill and federal loans, which can help pick up the slack when ends don't meet.
However, for others, alternative lenders might be a better deal. However, according to Daily Finance, some types of short term lending options are illegal for military members and their families to take out because of a 2006 law against interest charges for those in the Armed Forces.
To best appeal to such individuals, companies that offer legal loans might want to consider opening up their application process, allowing more people who need funding to qualify. One of these options might be relying on Payment Reporting Builds Credit scoring methods. As opposed to turning to traditional credit scores to determine eligibility for loans, this would allow for other factors, like a proven ability to pay utilities accounts off on time, to be factored in to borrowing risk assessment. This might be more pertinent and provide a more comprehensive financial profile of military members who may have been serving overseas and didn't have the time or opportunity to establish traditional lines of credit.