How Does the New GI Bill Work with Loan Repayment?

Yes, if you selected the loan repayment option, then the time that you served to pay off your student loans doesn’t count toward the new GI Bill, but any active duty service other than that, if it falls after September 11, 2001, does count. This assumes that you meet other criteria, such as either still being in the service or receiving an honorable discharge.

If you serve between 24 and 30 months of active duty, and you are an active duty service member, then you are eligible for 80% benefits. This means that you are eligible to receive up to 80% of your school’s tuition, up to 80% of the maximum based on the most expensive in-state public undergraduate tuition in the state you are taking courses (see this page on the VA site).

Likewise, the housing stipend, if you are eligible (meaning you are taking at least one traditional classroom course, as opposed to online or distance-learning courses), is reduced to 80%, as is the book allowance.