Does anyone have info where to look/apply for the no interest loan Social Security talks about? I cannot seem to navigate thru the directions to actually find application form and where and when to bring it to our nearest branch here in Maine. Thank you!

1 Answer 1


The interest-free loan from Social Security is perhaps not exactly what you may think it is. Social Security is not in the loan business.

What you can do under certain circumstances, however, is apply for Social Security benefits, start collecting, and then later change your mind and pay back everything that Social Security has sent you so far, essentially undoing your application for benefits. Then at some point in the future, you can apply again (presumably at a higher benefit rate, because you are older).

It is not the same as a traditional loan. You don't get a lump sum at the start; you just start getting a monthly check from the government. There is no interest because it is not a loan. You simply submit your application withdrawal before the time limit and pay back what you have been given, and if you don't do this in time, you'll just continue to receive your benefits.

Before 2010, this was easier to do. You could start receiving benefits at age 62, and then when you turned 70, you could send everything you were given back and then reapply at the higher age 70 benefit rate. This loophole has been closed, and there are now much tighter restrictions on what you can do.

According to this article on thebalance.com, here are the current restrictions:

  • You can withdraw your application for Social Security benefits within 12 months of when you first became eligible for benefits.
  • You can withdraw your application for benefits within 60 days of when you applied for benefits.
  • You must repay all the benefits you and your family received based on your retirement application.
  • You must file form SSA-521 with the Social Security Administration.
  • You can only withdraw your application for benefits once in your lifetime.

With the current restrictions, the idea is that if you start benefits but then realize within a short timeframe that you had made a mistake, you can undo your decision. But the restrictions make intentionally trying to take advantage of interest-free money much less attractive.

  • "you could send everything you were given back and then reapply at the higher age 70 benefit rate." Where would you get the money? (Investing it all in the stock market, and hoping that the market rises enough to pay it all back, plus taxes?)
    – RonJohn
    Oct 17, 2019 at 14:10

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