How To Pay Back GI Bill Overpayment

Veterans can get great help from the VA with paying for school and training programs through the GI Bill. But sometimes veterans have to pay the VA back money because the GI Bill paid them too much. In most cases, this happens after the VA has already sent payment because of a change in enrollment. Don’t panic if you find yourself in this situation. Here is everything you need to know about how to settle a GI Bill debt.

What Causes GI Bill Overpayments

The most common reasons for GI Bill overpayments are:

Dropping one or more classes after the drop/add deadline. This results in an overpayment for tuition, fees, housing allowance, and book stipend associated with the dropped class(es).
Withdrawing completely from school after classes start This results in overpayments for the entire enrollment period,
Reducing your course load below full-time. This can result in housing allowance and book stipend overpayments.
School reporting enrollment changes late. If the school takes too long to let you know about a change, you may have already been paid for the old school year.
Getting non-punitive grades, like withdrawals after the drop deadline, means that the VA won’t pay for classes you didn’t finish unless there are special circumstances.
Receiving active duty pay that counts against GI Bill housing allowance,

Basically, anytime your actual enrollment differs from what the VA has certified, it can cause an overpayment. It’s your responsibility to promptly report changes to avoid or minimize overpayments.

How the VA Collects GI Bill Debt

The VA takes overpayment debt very seriously. Here’s what you can expect if you end up with GI Bill debt:

You’ll receive letters explaining the debt and requesting repayment. First from the Regional Processing Office, then from the Debt Management Center.
The Debt Management Center will start collection actions if you don’t repay the full amount or set up a payment plan within 30 days.
The VA can withhold future education benefits payments to recoup the debt.
Serious delinquent debts may be referred to the Treasury Department for further collection actions.
Debts can be taken out of tax refunds, federal pay, and other federal benefits through the Treasury Offset Program.

It’s very important to take action quickly if you receive GI Bill debt notices. Contact the Debt Management Center at 1-800-827-0648 right away to avoid escalated collection actions.

Repayment Options for GI Bill Debt

If you end up owing GI Bill overpayment debt to the VA, here are your repayment options:

Pay the Full Amount Immediately

If possible, paying off the debt in full right away is the best option. Call the Debt Management Center at 1-800-827-0648 to make a payment by credit/debit card or bank account over the phone.
You can also mail a check or money order made payable to “U.S. Department of Veterans Affairs” to the address provided in your debt letter. Include your VA file number.

Set Up a Repayment Plan

If you can’t pay the debt in full, call the Debt Management Center to set up a monthly repayment plan. They will work with you.
Smaller payments can be automatically deducted from your bank account on a schedule.
Adjust plans if your circumstances change. But avoid defaulting on your agreement.

Request a Debt Waiver

You can request debt waiver if you had mitigating circumstances causing the overpayment and repayment would cause financial hardship.
Mitigating circumstances include medical issues, family emergencies, school closures, etc.
The VA will review your evidence and make a waiver determination. Waivers are not guaranteed.

File a Notice of Disagreement

You have 1 year from the debt notice date to file an NOD disputing the validity or amount of the debt.
The VA will review your dispute and make a new decision.
Collection activity may be paused during review, but interest continues to accrue.

Don’t just ignore GI Bill overpayment debt hoping it will go away. Work with the VA right away to repay the debt or file an appeal. Avoid threats to your credit, tax refunds, and federal benefits down the road.

Strategies to Prevent GI Bill Overpayments

While GI Bill overpayments do happen, there are ways to minimize your risk:

Report all enrollment changes to your school and VA promptly. Don’t wait for the school to notice.
Pay close attention to school deadlines for drop/add and withdrawals. Don’t miss refund windows.
Understand your school’s policies on refunds for dropped classes. The VA can’t control school refunds.
Don’t rely on the school to report changes. Follow up to confirm the VA is notified.
Only take courses you know you can complete. Don’t guess about mitigating circumstances.
Keep tabs on your tuition account balance and VA payments to your school. Report discrepancies.
Contact your school’s VA/financial aid office if you have any doubts about enrollment reporting.

Staying on top of your enrollment status and VA benefits can help you avoid surprise debt from GI Bill overpayments down the road.

Getting Help with GI Bill Overpayments

If you receive debt notices from the VA, take prompt action. Here are some resources:

Contact the Debt Management Center at 1-800-827-0648 for personalized assistance
Visit the GI Bill Debt Info page on the VA website for more details
Speak with the certifying official at your school
Connect with a Veterans Service Officer from a VSO like the American Legion or VFW

You have options for repaying debt and avoiding aggressive collection actions. But time is critical. Reach out for help managing GI Bill overpayments right away.

GI Bill overpayments can happen to veterans for a variety of reasons. Usually it is due to enrollment changes that reduce training time after payments have been issued. The VA takes debt repayment very seriously and will pursue collection through various methods if needed. The best approach is to act quickly when notified of debt by calling the Debt Management Center to repay in full, set up a plan, request a waiver, or file a dispute. With proactive management, GI Bill overpayments can be resolved without too much headache. Reach out for assistance if you need help dealing with Post-9/11 GI Bill or other VA education benefit debts.

How To Pay Back Gi Bill Overpayment

What Happens If I Had A Good Reason For Dropping Classes?

In some cases the VA is willing to forgive an overpayment due to mitigating circumstances.

Mitigating circumstances are circumstances beyond your control that prevent you from continuing in school or that cause you to reduce credits. Mitigating circumstances include the following:

A sickness or injury that the student had during the enrollment period
An illness or death in the student’s immediate family.
An unavoidable change in the student’s conditions of employment.
An unavoidable geographical transfer resulting from the student’s employment.
Urgent family or financial obligations that are out of the claimant’s control and force him or her to stop going to school in order to get a job
Discontinuance of the course by the school.
Unanticipated active military service, including active duty for training.
problems that the student didn’t expect with the childcare plans he or she made for the time that he or she is in classes

If you withdraw or drop classes after the drop period and a non-punitive grade is assigned — and mitigating circumstances are an issue — adequate evidence of mitigating circumstances must be provided to the VA. If this evidence is not provided, the VA will not pay for the course or courses in question, leaving YOU responsible to pay the school for any remaining tuition and fees.

The school can tell the VA why you dropped out if you talk to your certifying official and explain it. For example, the School Certifying Official may report the following to the VA: “Student withdrew 5/6/21 following Father’s death on 4/30/21. If the change is for a good reason, giving the reason for the withdrawal or reduction when the change is reported will help you avoid or lower an overpayment.

For courses you’ve already been paid for, VA will give you an overpayment (with the exception of six credit hours, which are explained below). This will start from the start of the term, quarter, or semester.

Realizing that sometimes situations arise that result in you dropping classes, the VA automatically grants mitigating circumstances for up to 6 credits the first time you drop a class or classes outside of the drop/add period. The VA refers to this as the 6-Credit Hour Exclusion. You can only use this free deal one time though.

Why Do I Have To Pay Back The Tuition & Fees to the VA? The School Got Them, Not Me.

According to the VA, it is your responsibility to pay them back and then go to the school and see if you can get a refund. That is because school refund policies are different at each school, and it would be far too cumbersome for the VA to try and deal with it at thousands of schools worldwide.

The VA will collect from the school if:

No matter the reason, you never went to any of the classes for which you were certified.
You dropped out of the whole thing on or before the first day of the term.

The VA will collect from you if:

You totally withdraw after the first day of the term
You dropped classes resulting in a reduced training time

The VA says that you are responsible for keeping track of your tuition and fee account balance and payments. They recommend that you visit their schools financial office regularly to review your account, ensure the charges are correct and that payments and refunds are processed correctly. They also recommend that you contact your school’s certifying official to ensure the certification information they send matches your class schedule.

GI Bill Overpayment: What to Do | theSITREP

FAQ

Can you get your GI Bill money back?

You will get some or all of the money you put into MGIB-AD back if you decide to use Post-9/11 GI Bill benefits and use up all of your entitlement for those benefits. The maximum amount you can get for a refund is $1,200.

What happens to leftover GI Bill money?

Service members approved to transfer their benefits to eligible immediate Family members enrolled in the Defense Eligibility Enrollment Reporting System (DEERS) may transfer up to the remaining months of unused Post-9/11 GI Bill benefits, or the entire 36 months if the member has used none (unless DoD/DHS limits the .

How far back can the VA go for overpayment?

Because there is no limit on how much VA can ask a vet to repay, and no limit on how far back it can go to collect the debt, these sums can become enormous. Many times, VA withholds entire checks from veterans who may be living on fixed incomes.

Do you ever have to pay back a GI Bill?

If you’re using Montgomery GI Bill Active Duty (MGIB-AD), Montgomery GI Bill Selected Reserve (MGIB-SR), or Survivors’ and Dependents’ Education Assistance (DEA), you may need to pay us back the benefits we’ve paid directly to you. And your school will likely ask you to pay them back for any debt we charged to them.

Are You owing the VA for GI Bill overpayments?

The number of veterans experiencing indebtedness to the VA has increased since the Post-9/11 GI Bill went into effect. You may owe the VA for GI Bill overpayments in a number of situations, but the most common reason is changing your enrollment, especially after the school’s drop/add deadline.

Do I need to pay back my GI Bill benefits?

If you use the Montgomery GI Bill Active Duty (MGIB-AD), the Montgomery GI Bill Selected Reserve (MGIB-SR), or Survivors’ and Dependents’ Education Assistance (DEA), you might have to repay us for the money we gave you. And your school will likely ask you to pay them back for any debt we charged to them.

How do I receive GI bill payments via direct deposit?

Effective immediately, institutions that receive, or wish to receive, Post-9/11 GI Bill payments via direct deposit must submit a request, or any change in information, to VA on school letterhead. The letter should be forwarded to the Education Liaison Representative (ELR) for the state in which the school resides.

Are You overpaid for VA benefits?

You may be overpaid for VA benefits for a variety of reasons, and those reasons can vary depending on the nature of your benefits. Some immediately think of the GI Bill when contemplating overpayment but there are a variety of scenarios that could result in a veteran getting more money than they were supposed to. They include:

What is a VA overpayment?

A VA overpayment is when a Veteran receives more VA benefits than he or she is entitled to and therefore must pay that extra money back to the Department of Veteran Afairs. Often this may happen if a Veteran is delayed in submitting paperwork or forgets to update records.

How do I Pay my va copay Bill?

You can also pay your VA copay bills in any of these 3 ways: Pay by phone: Call us at 888-827-4817 (TTY: 711). Pay by mail: Send your payment stub and a check or money order made payable to “VA” to the address listed here. Include your account number on the check or money order. Pay in person: Go to the VA health facility that sent the bill.