How to Get Student Loan Forgiveness

If you’re struggling to repay your student loans, you may be eligible for student loan forgiveness. Learn how to get student loan forgiveness and get rid of your debt.

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Introduction

The Department of Education (ED) offers several student loan forgiveness programs for certain career paths. If you’re interested in public service, teaching, or working in certain nonprofit organizations, you may be eligible for student loan forgiveness after making 120 qualifying monthly payments.

To qualify for student loan forgiveness, you must:
– Make 120 qualifying monthly payments on your Direct Loans after Oct. 1, 2007, under certain repayment plans
– Not be in default on your loans
– Have a remaining balance on your Direct Loan(s)

The ED will forgive the remaining balance of your Direct Loans if you:
– Work full-time for a qualified employer in a public service job during the repayment period
– Meet other conditions outlined by the ED

What is Student Loan Forgiveness?

Student loan forgiveness is when you are no longer required to make payments on your student loans. There are several ways to qualify for student loan forgiveness, which we’ll discuss in more detail below.

The most common way to get student loan forgiveness is through Public Service Loan Forgiveness (PSLF). To qualify for PSLF, you must work for a qualifying employer and make 120 monthly payments on your Direct Loans. After making these payments, the remaining balance on your loan will be forgiven.

Other ways to get student loan forgiveness include repayment plans, such as Income-Driven Repayment (IDR) plans, and Perkins Loan cancellation. With an IDR plan, your monthly payment is based on your income and family size. After making payments for 20-25 years (depending on the plan), the remaining balance on your loan will be forgiven. Perkins Loan cancellation forgiving 100% of your Perkins Loan if you work in certain public service jobs.

You may also be able to have your loans forgiven if you are unable to repay them due to a disability or death.

How to Get Student Loan Forgiveness

The first step to get student loan forgiveness is to contact your loan servicer and inquire about the different repayment plans that are available. You might be eligible for an income-driven repayment plan, which could lower your monthly payments. You can also consolidate your loans, which could lower your interest rate and make your payments more manageable. If you’re struggling to make your payments, you can also defer or forbear your loans.

Public Service Loan Forgiveness

The Public Service Loan Forgiveness (PSLF) Program forgives the remaining balance on your Direct Loans after you have made 120 qualifying monthly payments under a qualified repayment plan while working full-time for a qualifying public service employer.

You may qualify for forgiveness of the remaining balance due on your eligible federal student loans based on your employment in a public service job. You must have made 120 qualifying monthly payments on your eligible federal student loans while employed full time by a qualifying public service organization and meet other eligibility requirements to receive loan forgiveness.

There are several repayment plans that qualify for PSLF, but the standard 10-year repayment plan is not one of them. You’ll need to sign up for an income-driven repayment plan to get started. Then, you’ll need to make 120 qualifying payments while working full time for a qualifying employer. If you switch jobs, as long as you work full time for a qualifying employer, any remaining qualified payments will still count towards the 120 total.

Teacher Loan Forgiveness

If you’re a teacher, you may be eligible for student loan forgiveness through the Teacher Loan Forgiveness Program. To qualify, you must teach full-time for five complete and consecutive academic years in a low-income elementary or secondary school or educational service agency. You must also have made 120 qualifying payments on your Direct Loans after Oct. 1, 2007, under a qualifying repayment plan.

Forgiveness under this program is capped at $17,500 for borrowers with Direct Loans. If you have FFEL Program Loans, you may be eligible for forgiveness through the FFEL Consolidation Loan program.

To learn more about this program and to apply, visit the Teacher Loan Forgiveness page on the StudentAid.gov website.

Perkins Loan Cancellation and Discharge

The Perkins Loan Cancellation and Discharge program cancels a portion of your Perkins Loan each year that you teach full-time in a eligible school or work in certain service jobs. After you complete five years of teaching or service, you can have the remaining balance of your loan forgiven.

To qualify, you must:
-Teach full-time in a elementary or secondary school that serves students from low-income families and meets other criteria
-Teach in certain subject areas, or be a licensed special education teacher
-Serve as a volunteer under the Peace Corps Act or ACTION program
-Serve in an AmeriCorps position for which you received an AmeriCorp Education Award

Income-Driven Repayment Plans

Income-driven repayment plans are based on your income and family size. You’ll generally pay 10% to 20% of your discretionary income each month, and after 20 to 25 years (depending on the plan), any remaining balance on the loan will be forgiven.

There are four types of income-driven repayment plans:

Pay As You Earn (PAYE)
Revised Pay As You Earn (REPAYE)
Income-Based Repayment (IBR)
Income-Contingent Repayment (ICR)

You may want to consider an income-driven repayment plan if you:

Have a partial financial hardship
Don’t qualify for PAYE or IBR but want lower payments than you’d get under the Standard Repayment Plan or another repayment plan with fixed payments

Keep in mind that you’ll likely pay more interest over time because your monthly payments may not cover all the interest that accrues on your loans, and any forgiven amount may be taxable.

Other Loan Forgiveness Programs

In addition to the Public Service Loan Forgiveness Program, there are a number of other loan forgiveness programs available for borrowers. These programs are typically offered by state or local governments, or non-profit organizations, and may be available to borrowers who are employed in certain professions, such as teaching or healthcare. Some of these programs may forgive all of a borrower’s remaining student loan debt, while others may only forgive a portion.

Conclusion

There are many ways to get student loan forgiveness, but it’s not always easy. You may need to work for a qualifying organization, be employed in a public service job, or meet other requirements. But if you can qualify, student loan forgiveness can be a great way to get out of debt and move on with your life.