US Student Loan Forgiveness Programs aim to reduce the burden of student loan debt. The Public Service Loan Forgiveness (PSLF) program offers complete forgiveness after 120 qualifying payments for those working in public service. Income-driven repayment plans, such as IBR and PAYE, allow borrowers to repay based on their income, with forgiveness possible after 20-25 years. Targeted forgiveness programs for student loans exist for professions like teachers and military personnel. It’s crucial to understand eligibility, application processes, and potential tax implications. These programs provide relief, reduce debt burdens, and empower borrowers to focus on their future without the weight of student loans. Keep reading the blog to read about the eligibility criteria for various programs and other alternatives to forgiveness plans.
How to Qualify for Top Student Loan Forgiveness Programs in 2023?
Each student loan forgiveness plan has distinct eligibility criteria. The following section includes qualifying criteria for different types of cancellation and forgiveness plans.
IDR Forgiveness
To qualify for this student loan forgiveness program, the borrower must be eligible for any of the below listed IDR plans and possess a loan balance after paying for the entire repayment term:
- Revised Pay As You Earn (REPAYE)
- Income-based repayment
- Pay As You Earn (PAYE)
- Income-contingent repayment
Also Read: Direct Plus Loans
Perkins Loan Cancellation and Discharge
Borrowers of Perkins Loans might be eligible for full or partial student loan forgiveness. To qualify for Perkins Loan Cancellation and Discharge, borrowers must choose the below-mentioned career paths.
| Job Profiles | Amount of Student Loan Cancelled |
| Firefighter (Full-Time) (Services that started on or after 14th August 2008) | Up to 100% of student loan debt for 5 years of service |
| Teacher | Up to 100% of student loan debt for 5 years of service |
| Medical Technician and Nurse (Full-Time) | Up to 100% of student loan debt for 5 years of service |
| Faculty at a Tribal University or College (Full-Time) | Up to 100% of student loan debt for 5 years of service |
| Early Intervention Service Providers for the Specially Abled (Full-Time Professional) | Up to 100% of student loan debt for 5 years of service |
| Speech Pathologist at Title 1 select secondary and elementary school (Full-Time) | Up to 100% of student loan debt for 5 years of service |
| Corrections Officer and Law Enforcement Officer (Full-Time) | Up to 100% of student loan debt for 5 years of service |
| Librarians at Title 1 select secondary and elementary schools or public libraries for students of Title 1 select schools | Up to 100% of student loan debt for 5 years of service |
| An attorney working at a Community Defender Organisation and a Federal Public Defender Organisation (Full-Time) | Up to 100% of student loan debt for 5 years of service |
| An employee of a non-profit or public family-service agency, child-service agency | Up to 100% of student loan debt for 5 years of service |
| Peace Corps Volunteer and AmeriCorps VISTA | Up to 70% for 4 years of service |
| Staff Member as an Education Component of any Head Start Program (Full-Time) | Up to 100% of student loan debt for 7 years of service |
| Staff Member in a Child Care Programme or Education Component of a Prekindergarten | Up to 100% of student loan debt for 7 years of service |
Also Read: Federal Student Loans for Study Abroad
Public Service Loan Forgiveness (PSLF)
Here is how education loan borrowers can qualify for one of the readily accessible student loan forgiveness programs:
- A borrower must pay 120 monthly student loan payments
- A borrower must be employed in a full-time role in eligible non-profit organisations while paying EMIs for 120 months
- A borrower who pays monthly instalments under an IDR plan
Teacher Loan Forgiveness
Beneficiaries of the Teacher Loan Forgiveness Program are eligible to receive up to USD 17,500 as loan forgiveness. To avail of this financial aid, borrowers must have worked as a full-time teacher for five consecutive academic years. They must be employed in educational agencies or low-income secondary schools or elementary schools. Teachers of mathematics and science qualify for forgiveness of USD 17,500. Whereas, teachers of subjects other than mathematics and science are eligible for USD 5,000 forgiveness.
To qualify for this program, a borrower must have availed of either of the following student loans:
- Federal Direct Subsidised Loans or Subsidised Stafford Loans
- Federal Direct Unsubsidised Loans or Unsubsidised Stafford Loans
Do Parent Borrowers Qualify for Student Loan Forgiveness Programs?
In addition to student borrowers, parent borrowers also qualify for student loan forgiveness programs. However, parents have to follow extra steps to get forgiveness.
The table displays the student loans cancellation or forgiveness plans for which parent borrowers are eligible:
| S. No | Loan Discharge or Forgiveness Programs | Parent Borrower Eligibility |
| 1 | IDR Forgiveness Plan | Yes |
| 2 | PSLF | Yes |
| 3 | Borrower Defense to Repayment | Yes |
| 4 | Perkins Loan Cancellation and Discharge | No |
| 5 | Teacher Loan Forgiveness Plan | Yes |
| 6 | Unpaid Refund Discharge | Yes |
| 7 | Discharge Due to Death | Yes |
| 8 | Closed School Discharge | Yes |
| 9 | Total and Permanent Disability Discharge | Yes |
| 10 | False Certification Discharge | Yes |
Also Read: Parent Plus Loan: Eligibility, Forgiveness, Calculator, Maximum Amount
Alternatives to Student Loan Forgiveness Programs
Unfortunately, not all student loan borrowers are eligible for federal student loan forgiveness programs. For non-eligible borrowers, the US federal and state governments offer the following alternatives:
Research State Loan Assistance Programs
Student loan borrowers who endure financial hardships or medical emergencies can request forbearance or deferments from their loan servicers. These borrowers can postpone payments for some months on a temporary basis. Borrowers are advised to reach out to their servicers in medical emergencies, childcare issues, or unexpected job losses.
Also Read: What Are The Pros And Cons Of Paying-Off Student Loans Early?
Request Deferment or Forbearance
Furthermore, borrowers can also opt for State Loan Assistance Programs. Numerous US states repay a part of the student loans of beneficiaries in order to recruit them for public jobs. For instance, Florida offers student loan debt discharges of up to USD 5,000 to eligible lawyers under its Florida Bar Association’s Loan Repayment Program. This benefit is available to both private and federal loan beneficiaries. Additionally, the state of Washington offers up to USD 75,000 for student loan payments to healthcare professionals via its State Health Program.
FAQs
Parent borrowers qualify for IDR Forgiveness Plan, PSLF, Unpaid Refund Discharge, Total and Permanent Disability Discharge, Closed School Discharge, and Borrower Defense to Repayment.
To qualify for this student loan forgiveness program, the borrower must be eligible for IDR plans like PAYE, REPAYE, Income-contingent repayment, and Income-based repayment.
Some of the alternatives are Forbearance, Deferment, Florida Bar Association’s Loan Repayment Program, and the State Health Program of Washington.
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