Last Updated: February 11, 2024
Student loan forgiveness can be a great way to reduce or eliminate student loan debts. However, qualifying for student loan forgiveness can vary depending on the type of loan you have and the program you’re using.
In this blog post, we’ll discuss who qualifies for student loan forgiveness and how to apply for it!
What Is Student Loan Forgiveness?
Attending college comes with huge financial expenses, so many families are concerned about how to pay for college, and the most common solution is a loan! In most situations, the loan has to be paid off, but this can be avoided through opportunities such as student loan forgiveness.
Student loan forgiveness is when you’re no longer responsible for paying back your student loans. This can happen through different programs or situations, such as working in a public service job, having your loans discharged due to disability, or attending an eligible school. Forgiveness of your student loans can also occur if you make regular payments for a certain period of time through an income-driven repayment plan.
|DID YOU KNOW: Statistics on student debt show that around 46 million Americans have student loan debt.
What Is the Difference Between Forgiveness, Cancellation, and Discharge?
Forgiveness, cancellation, and discharge of your student loans all mean you’re no longer obligated to pay back your loans. However, there are some key differences between these terms.
- Forgiveness usually refers to a situation where you’re no longer responsible for repaying your loans because you’ve met certain requirements such as working in a public service job.
- Cancellation usually means your loan is no longer owed because you’ve met certain requirements such as attending an eligible school.
- Discharge usually refers to a situation where your loan is no longer owed because of a specific circumstance, such as bankruptcy or disability.
Who Qualifies for Student Loan Forgiveness?
There are a few different programs that offer student loan forgiveness, each varying in who qualifies for it. Some programs like the Public Service Loan Forgiveness Program are only available to borrowers with certain types of loans, while others like the Teacher Loan Forgiveness Program are only available to borrowers working in certain fields. To see if you qualify for student loan forgiveness, you can check out the eligibility requirements for each program.
What Do You Need to Know When Applying for a Student Loan Forgiveness?
To get loan forgiveness for student loans, you must be working in a public service position for at least 30 hours per week in order to be eligible for the Public Service Loan Forgiveness program (PSLF). After you’ve consolidated your federal loans into a suitable repayment arrangement, you must additionally complete 10 years of punctual monthly payments (a total of 120).
The only loans covered by this option are Direct Federal Student Loans—private student loans aren’t covered by the PSLF program.
|NOTE: Those who applied from the class of 2007 were the first to be eligible for loan forgiveness in 2017, and 99 percent of those applications were turned down. According to the U.S. Department of Education, that percentage has marginally improved, with 2.4 percent of applications being approved as of September 2020.
Many borrowers wondered what qualifies you for student loan forgiveness before learning their applications had been turned down because they were in the wrong repayment plan. In an effort to reduce the number of denied applications, the Department of Education launched the PSLF Help Tool in 2018.
The PSLF Help Tool helps you find employers that meet the program’s standards, and has a number of questions pertaining to those requirements to guide borrowers through the eligibility process.
You can still be qualified for Temporary Expanded Public Service Loan Forgiveness if you’re judged ineligible because some or all of your payments weren’t made under a qualifying plan.
Public Service Job Positions That Qualify for Public Service Loan Forgiveness:
Loan forgiveness for student loans is available for any position inside a government agency, whether at the federal, state, municipal, or tribal level. Working for non-profit organizations that have received a Section 501(c)(3) determination of tax-exempt status is also acceptable.
Loan forgiveness eligibility also applies to those working for other non-profit groups like AmeriCorps and the Peace Corps that offer a qualifying public service, but aren’t tax-exempt. The most popular fields for working in the public sector include veterinary medicine, law enforcement, health care, and public administration.
Repayment Plans That Qualify for Public Service Loan Forgiveness:
Several repayment options, including the Income-Based Repayment Plan (IBR), Income-Contingent Repayment Plan (ICR), Pay As You Earn Repayment Plan (PAYE), and Revised Pay As You Earn Repayment Plan, are eligible under the PSLF program (REPAYE) for student loan forgiveness in 2022.
We should note the 10-year Standard Repayment Plan is also regarded as a qualifying plan, but as it lasts for just 10 years, there won’t be any money left over to be forgiven if you make your payments on time. To join a PSLF program, you must sign up for a repayment plan that extends your loan term past 10 years.
|DID YOU KNOW: Student debt statistics show that around 20 million borrowers were offered debt relief by the CARES Act between Q2 and Q3 of 2020.
|Student loan forgiveness is when you’re no longer responsible for paying back your student loans.
|Working in a public service job, having your loans discharged due to disability, or attending an eligible school are some of the reasons someone can qualify for student loan forgiveness.
|Forgiveness of your student loans can also occur if you make regular payments for a certain period of time through an income-driven repayment plan.
|Forgiveness, cancellation, and discharge of your student loans in the student loan forgiveness program all mean you’re no longer responsible for paying back your loans.
|The Public Service Loan Forgiveness Program and Teacher Loan Forgiveness Program are two of the programs that offer student loan forgiveness.
How to Apply for Student Loan Forgiveness?
If you think you might qualify for student loan forgiveness, the next step is to apply for it! The process for applying for student loan forgiveness can vary depending on the program you’re using—some programs like the Public Service Loan Forgiveness Program require you to submit an application and provide employment documentation.
Other programs like the Teacher Loan Forgiveness Program may require you to submit an application and provide documentation of your teaching service.
To be considered for PSLF and the student loan forgiveness program, you must submit an Employment Certification Form annually together with any necessary pay stubs, W-2s, or other supporting evidence.
If you’ve satisfied the payback conditions, send a PSLF application to the Department of Education, and your loan’s remaining balance will be forgiven if it’s accepted.
However, keep in mind that the entire PSLF program is in limbo until President Biden or the Congress submit a plan to change the program. The amount of the monthly payments might also be reduced, and couples and individuals making less than $25,000 annually possibly wouldn’t be required to make any loan payments until their salaries exceeded this threshold.
Student loan forgiveness can be a great way to reduce or eliminate your student loan debt, but who qualifies for it can vary depending on the type of loan you have and the program you’re using. There are a number of ways to get student loan forgiveness, but it’s not easy—you’ll need to make sure that you qualify and then apply for the program that best suits your needs.
Conversely, if you’re wondering whether you can refinance your student loan, you should check some of the best companies for student loan refinance in 2022!
You might not qualify for student loan forgiveness if you’re not employed by a qualifying employer, you’re not in the right type of loan forgiveness program, or you’re behind on your student loan payments. However, you might still be able to get your loans forgiven if you consolidate your loans or enter an income-driven repayment plan.
No, student loans don’t go away after 7 years. However, as we mentioned in the article above, there are a number of ways to get your student loans forgiven.
Yes, you can, but you first need to understand who qualifies for student loan forgiveness. To qualify for it, you must fulfill specific criteria—for instance, if you work in public service or teaching, you might be able to get your loans forgiven after making 120 qualifying monthly payments.