Student loan forgiveness programs are initiatives designed to alleviate the financial burden taken for education purposes. It can be partially or completely forgiven.
These programs are often implemented by governments or private organizations to promote higher education accessibility and easing the financial strain on graduates. There are several types of student loan forgiveness programs, each with its eligibility criteria and requirements. Some of the common ones include:
1. Public Service Loan Forgiveness (PSLF)
Public Service Loan Forgiveness (PSLF) is a federal program in the United States designed to help individuals working in public service jobs manage their student loan debt.
The program was established under the College Cost Reduction and Access Act of 2007 to encourage individuals to pursue careers in public service while providing a pathway to loan forgiveness.
- Eligible Loan Types: Direct Loans and Direct Consolidation Loan.
- Qualifying Payments: Borrowers must make 120 qualifying monthly payments under a qualifying repayment plan.
2. Income-Driven Repayment (IDR) Forgiveness
Looking for loan forgiveness programs for student loans? You can try applying for IDR forgiveness. It is one of the forgiveness programs for student loans designed to assist borrowers struggling with the repayment of their federal student loans.
This program is part of the broader Income-Driven Repayment Plans offered by the U.S. Department of Education. The IDR Forgiveness program aims to provide relief to borrowers by forgiving any remaining loan balance after a certain period of qualifying payments.
- Eligible Loan Types: Direct loans and federal student loans.
- Qualifying Payments: Borrowers may be eligible for forgiveness after making consistent payments for 20 or 25 years, depending on the plan.
3. Nurse Corps Loan Repayment Program
The Nurse Corps Loan Repayment Program (NCLRP) is a valuable initiative designed to assist qualified nurses in managing their student loan debt. This program is administered by the Health Resources and Services Administration (HRSA).
To participate in the program, nurses must fulfill specific criteria, including working in a Critical Shortage Facility (CSF) or as an accredited school of nursing faculty member. Additionally, only payments made on loans that meet the program's eligibility criteria will be considered.
- Eligible Loan Types: Direct loans and Federal Nursing Student Loans, Subsidized Federal Stafford Loans and Graduate PLUS Loans.
- Qualifying Payments: The program may repay up to 60% of the nurse's total qualifying educational loan balance over two years of service.
4. State Sponsored Repayment Assistance Programs
State-sponsored repayment assistance programs play a crucial role in alleviating the financial burden of student loans for individuals pursuing higher education. These programs are designed to provide support to borrowers with eligible loan types and qualifying payments, aiming to make education more accessible and manageable.
- Eligible Loan Types: Direct Subsidized and Unsubsidized Loans, PLUS Loans, and Consolidation Loans.
- Qualifying Payments: The specific criteria for qualifying payments can vary by state and program.
5. Teacher Loan Forgiveness
The Teacher Loan Forgiveness program is a federal initiative designed to encourage individuals to enter and remain in the teaching profession by providing a pathway to forgiveness for a portion of their student loans.
To qualify, the borrower needs to have taught full-time for five consecutive academic years in a designated low-income school or educational service agency.
- Eligible Loan Types: William D. Ford Federal Direct Loan (Direct Loan) Program or the Federal Family Education Loan (FFEL).
- Qualifying Payments: A teacher may be eligible for forgiveness up to $5,000 or $17,500, depending on the subject taught.
6. Temporary Expanded Public Service Loan Forgiveness Program (TEPSLF)
The Temporary Expanded Public Service Loan Forgiveness Program (TEPSLF) is an initiative in the United States aimed at providing additional opportunities for borrowers to qualify for Public Service Loan Forgiveness (PSLF).
The program was introduced to address certain limitations and challenges that borrowers faced in meeting the requirements for loan forgiveness under the original PSLF program. Borrowers must be on a qualifying repayment plan. Typically, income-driven repayment plans are eligible, but other specific plans may also qualify.
- Eligible Loan Types: Direct Loans
- Qualifying Payments: Make 120 qualifying monthly payments under a qualifying repayment plan.
7. Borrower Defense Loan Discharge Program
The allows borrowers to seek loan discharge if they believe they were defrauded by their school, through actions such as false advertising, deceptive recruiting practices, or a breach of contract by the educational institution. It is among known student debt forgiveness programs in the US.
The program is designed to provide relief to students who attended schools that engaged in misconduct. To qualify for the Borrower Defense Loan Discharge Program, borrowers typically need to submit a Borrower Defense Application to their loan servicer.
- Eligible Loan Types: Direct Loans, Federal Family Education Loans (FFEL), and Federal Perkins Loans.
- Qualifying Payments: The program requires that borrowers make a good-faith effort to repay under an income-driven repayment plan, such as Income-Based Repayment (IBR) or Pay As You Earn (PAYE), and must be made on time.
8. Forgiveness with Income-Based Repayment (IBR)
Those seeking programs that forgive student loans can consider applying for this program. It is a valuable option for individuals burdened by student loans, providing a pathway to debt relief based on income and qualifying payments.
As with any financial decision, careful consideration and adherence to program requirements are paramount for success. While forgiven loan amounts under IBR can be significant, they may be considered taxable income, potentially leading to a tax liability for the borrower.
- Eligible Loan Types: Federal Loans and Direct Consolidation Loans.
- Qualifying Payments: For most borrowers, forgiveness occurs after 20 years of qualifying payments. However, for those working in public service jobs, forgiveness may be granted after 10 years of qualifying payments through the Public Service Loan Forgiveness (PSLF) program.
9. Forgiveness with Income-Contingent Repayment (ICR)
Another prominent program among the forgiveness loans for students is ICR. Income-contingent repayment (ICR) stands out as a lifeline for borrowers with eligible loan types and a track record of qualifying payments.
This repayment plan, offered by the federal government, is designed to make loan repayment more manageable by adjusting payments based on the borrower's income.
- Eligible Loan Types: Direct Subsidized and Unsubsidized Loans, Direct PLUS Loans.
- Qualifying Payments: To qualify for loan forgiveness under ICR, borrowers must make 25 years of qualifying payments.
10. Forgiveness with Revised Pay As You Earn (REPAYE)
REPAYE is one of several income-driven repayment plans designed to ease the burden of student loan debt for borrowers facing financial challenges.
However, individuals considering this path should carefully review the program's terms, understand potential tax implications, and stay informed about any changes to federal student loan policies.
- Eligible Loan Types: Direct Subsidized and Unsubsidized Loans, Direct PLUS Loans for Graduate or Professional Students, and Direct Consolidation Loans.
- Qualifying Payments: To qualify for forgiveness, borrowers must make 20 years of qualifying payments if they only have undergraduate loans.
11. Military Student Loan Forgiveness and Assistance
Military Student Loan Forgiveness and Assistance programs are designed to alleviate the financial burden of student loan debt for members of the military. These programs vary and may apply to different branches of the military.
Military personnel can qualify for the Public Service Loan Forgiveness (PSLF) program if they work in qualifying public service jobs, which include military service. Keep records of your military service, payments made, and other relevant documentation to support your application.
- Eligible Loan Types: Federal Direct Loans and other federal loans may become eligible through consolidation into a Direct Consolidation Loan.
- Qualifying Payments: Borrowers must make 120 qualifying monthly payments under a qualifying repayment plan while working full-time for a qualifying employer.
12. Unpaid Refund Loan Discharge
For students burdened by the weight of federal student loans, the prospect of loan discharge can be a beacon of hope. One such avenue is the Unpaid Refund Loan Discharge, a program designed to provide relief to borrowers who meet specific criteria related to their loan types and qualifying payments.
The notion is based on forgiveness for federal student loans. It specifically addresses situations where a borrower withdrew from school but did not receive the full refund of their loan as they were entitled to.
- Eligible Loan Types: Federal student loans, including Direct Loans, FFEL (Federal Family Education Loan) Program loans, and Perkins Loans.
- Qualifying Payments: Require borrowers to make a certain number of qualifying payments while working in a specific profession or for a qualifying employer.
13. Closed School Discharge
If a school closes while a student is enrolled or shortly after the student withdraws, they may be eligible for a closed school discharge, which forgives the federal student loan debt incurred for attending the closed school.
The closure of an educational institution can be a significant disruption for students, impacting their ability to complete their programs and receive the intended benefits of their education. The U.S. Department of Education recognizes the challenges faced by these students and offers the Closed School Discharge option as a means to discharge their federal student loans.
- Eligible Loan Types: Direct Loans, Federal Family Education Loans (FFEL), and Federal Perkins Loans.
- Qualifying Payments: If the school closed within 120 days after the borrower withdrew, they may also be eligible. Qualifying payments made by the borrower during this period are not counted towards the discharge.