Forgiveness Of Private Student Loans

Forgiveness Of Private Student Loans

If you’ve taken out private student loans, you may feel like you’re stuck with them for life. But there are options for getting rid of them, including bankruptcy and forgiveness programs that are open to certain borrowers. In this post we’ll go over four different types of student loan forgiveness that can help you get rid of private student loans: Borrower Defense Discharge; Bankruptcy; Total and Permanent Disability Discharge (TPD); and Public Service Loan Forgiveness (PSLF).

Borrower Defense Discharge

The borrower defense discharge is a special type of loan forgiveness that applies only to private student loans. The law was created in 1993 and is known as the “Borrower Defense Rule.”

The borrower defense discharge is available only to borrowers who took out their loans after July 1, 2016 (and have not yet paid off their entire balance). The rule also applies only if the student attended a school that was closed while still enrolled or within 120 days after they stopped attending classes at this school (the 120-day period starts at the time of closure). Borrowers must also prove that they did not receive funds under another government program such as the Department of Education’s TEACH Grant Program or Perkins Loan Program.

Even if you meet these requirements, getting your debt discharged may be difficult because it requires that you prove that your school had an illegal or deceptive advertising practice or committed fraud against you by making false promises about job placement after graduation and other related issues.


When it comes to bankruptcy, that is not a good option. Bankruptcy can harm your credit score and take 10 years to get back to normal. Bankruptcy is a last resort and should only be considered if you have no other options.

Total and Permanent Disability Discharge

To qualify for the Total and Permanent Disability Discharge, you must:

  • Be totally and permanently disabled.
  • Apply for the discharge. You can do this by contacting your loan servicer (the company that handles billing and collections), or you can fill out an application form online at [].
  • Show that your disability prevents you from engaging in any substantial gainful activity, meaning that it prevents you from working on a full-time basis for at least 12 months or results in death before then. If your disability is based on a chronic condition that doesn’t prevent work but does limit how much work you can do, such as asthma or depression, it also requires documentation of how long your condition has been affecting your ability to work full time or why it may be likely to last throughout the next 10 years (such as cancer).

You have a few student loan forgiveness options

You are eligible for loan forgiveness if you meet the following criteria:

  • You have a federal Direct Loan or FFEL Program loan.
  • You work in public service for a specific period of time, typically 10 years.
  • The loans must be direct consolidation loans, not private student loans.

There are many ways to manage your student loans, and the best option for you depends on your financial situation. If you’re struggling with your payments and don’t know where to turn, consider all of these options so that you can find the best solution for yourself and your family.

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