Forgiveness Program For Student Loans
Forgiveness of student loans is possible. If you meet certain requirements, the federal government will forgive a portion of your debt. There are many different programs for forgiveness that vary in terms of eligibility criteria and repayment terms. To find out which program best suits your needs, keep reading.
School districts are not eligible for the forgiveness program. However, school districts are eligible for the forgiveness program if they are in the U.S. School districts outside of the U.S., however, are not eligible for this benefit.
Child Care Services
This payment plan is available to:
- Parents or legal guardians who are currently receiving child care assistance benefits.
- Parents or legal guardians enrolled in the Temporary Assistance for Needy Families cash assistance program.
- Parents or legal guardians with a household income that does not exceed 200% of the federal poverty guidelines published by the Department of Health and Human Services (as may be updated from time to time).
This payment plan is not available to:
- Individuals who are under age 18, unless they are legally emancipated. If a student is between ages 18-21 and has been accepted into college as a full-time student, he/she may be eligible for this program if his/her parent(s) meet all other eligibility requirements; however, students aged 21 and older must apply directly through their school’s financial aid office instead of through Federal Student Aid’s Customer Service Center at 1-800-4FEDAID (1-800-433-3243).
- What volunteer work qualifies:
- Volunteering at a hospital, soup kitchen or animal shelter is a great way to check the box for community service. But there are other types of volunteer work that qualify as well. Here’s a list of different organizations that may be willing to take you on as an intern:
- Nonprofit organizations
- Government agencies (including local, state and federal)
- Faith-based communities (churches, synagogues, mosques, temples)
Law Enforcement Agency
You are eligible for this forgiveness program if you are a full-time employee of a law enforcement agency, a firefighter or an individual who has been killed in the line of duty as a first responder. To qualify, you must have made 120 on-time payments while being employed by an eligible agency. You must also have been employed for at least 10 years and paid at least $5,000 in qualified student loan payments.
Teachers can apply for forgiveness after teaching for 5 years.
Teachers can apply for forgiveness after teaching for 10 years.
Teachers can apply for forgiveness after teaching for 15 years.
Teachers can apply for forgiveness after teaching for 20 years and beyond!
Private or non-profit organization in the US
You may be eligible for relief if you are a US citizen or permanent resident and have worked for a private or non-profit organization in the US for at least 3 years full time. You must also have been unable to make payments during that period because of a qualifying temporary financial hardship. To be eligible, your loans must be owed to an agency or organization that qualifies as a 501(c)(3) tax-exempt nonprofit according to the Internal Revenue Code (IRC).
Payment Plan Length
If you have a payment plan, the length of your plan can be viewed in the StudentLoans.gov Repayment Estimator. The repayment period is usually 10 years, and payments typically occur monthly. Be aware that interest accrues on any outstanding balance during this time, so if you do not pay off your entire loan in full by the end of 10 years, you will owe extra money at that point.
A typical payment plan has 24 monthly payments with an amount due each month depending on how much you owe when the first payment comes due (this is called a “debt profile” or “debt profile number”). For example:
Payments will vary from borrower to borrower based on their individual debt profiles (the higher your debt profile number and balance, the lower each of your monthly payments will be). In order to calculate exactly how much each month’s payment would be under this scenario (with no interest), just plug in those values into our calculator here: https://studentaidcalculatorservices.edloanservices.com/Student-Loan-Repayment-Calculator/. Once again – keep in mind that this calculator shows only what would happen if there were no interest accrued during repayment—in reality there usually will be some accrued interest which increases both total costs as well as time required for repayment!
Stay on top of your payments
If you’ve been struggling to make your payments, it’s important that you stay on top of them. Making sure that you’re making your payments on time and paying them in full will go a long way towards helping your credit score and getting back on track with a student loan forgiveness program.
One easy way to avoid making late or partial payments is to set up automatic payment plans with the lender. These are often free, and they allow lenders to withdraw money from your bank account automatically at designated times throughout the month in order to pay off your balance in full every month. This ensures that there won’t be any late fees or interest charges assessed against those who participate in these programs—and it also makes it easier for students who are trying their best but still struggling financially because they don’t have enough money left over after rent/utilities/food expenses each month after working multiple part-time jobs (or one full-time job).
We hope this information has been helpful in your journey to become a better borrower. If you have any other questions about repayment options or eligibility, please do not hesitate to contact us at (800) 555-1234. We are here for you!