10+ Student Loan Forgiveness Programs That Discharge Loans - NerdWallet (2024)

FAQs

Who is eligible for student loan discharge? ›

Your loan can be discharged only under specific circ*mstances, such as school closure, a school's false certification of your eligibility to receive a loan, a school's failure to pay a required loan refund, or because of total and permanent disability, bankruptcy, identity theft, or death.

In certain situations, you can have your federal student loans forgiven, canceled, or discharged. That means you won't have to pay back some or all of your loan(s). The terms “forgiveness,” “cancellation,” and “discharge” mean essentially the same thing.

If you are unable to work because of a total and permanent disability, you may be eligible for a Total and Permanent Disability (TPD) Discharge of your FFEL Program loans, Perkins Loans, Direct Loans, or Teacher Education Assistance for College and Higher Education (TEACH) Grant service obligation.

You may be eligible for income-driven repayment (IDR) loan forgiveness if you've have been in repayment for 20 or 25 years. An IDR plan bases your monthly payment on your income and family size.

You will receive notification of your loan discharge via email, mail and/or your online loan servicing account (depending how your communication preferences are set). It will also be reflected when you log in to the Federal Student Aid site using your FSA ID.

Depending on the discharge type, you may also receive a refund of some or all of the payments you made on the loan, and any adverse information related to your delinquency or default on the loan (if applicable) may be deleted from your credit record.

If you have loans that have been in repayment for more than 20 or 25 years, those loans may immediately qualify for forgiveness. Borrowers who have reached 20 or 25 years (240 or 300 months) worth of eligible payments for IDR forgiveness will see their loans forgiven as they reach these milestones.

No, the federal government doesn't forgive student loans at age 50, 65, or when borrowers retire and start drawing Social Security benefits. So, for example, you'll still owe Parent PLUS Loans, FFEL Loans, and Direct Loans after you retire.

you no longer have further obligation to repay the loan, you will receive a reimbursem*nt of payments made voluntarily or through forced collection, and. the discharge will be reported to credit bureaus to delete any adverse credit history associated with the loan.

Teachers with loans through Nelnet can pursue teacher loan forgiveness. Teachers may qualify to have a maximum of $17,500 or $5,000 in student loans forgiven, depending on the subject area taught, if specific requirements are met.

Is Nelnet considered a federal loan? ›

Nelnet is a federal student loan servicer working on behalf of the U.S. Department of Education (ED), the government agency that lends you student loans.

Borrowers with federal Perkins loans can have up to 100% of their loans canceled if they work in a public service job for five years. In many cases, approved borrowers will see a percentage of their loans discharged incrementally for each year worked.

What student loans are not eligible for forgiveness? Private student loans, by definition, are private and are not eligible to be forgiven. These are loans the borrower owes to student loan providers and not the federal government.

If you work full time for a government or nonprofit organization, you may qualify for forgiveness of the entire remaining balance of your Direct Loans after you've made 120 qualifying payments—i.e., 10 years of payments. To benefit from PSLF, you need to repay your federal student loans under an IDR plan.

Borrowers who reach forgiveness under the account adjustment will get an email notification by the end of 2023; all other borrowers will be notified in 2024. So if you requested a refund, but you've been in repayment for at least 20 to 25 years, you may be free from your student debt — including the refunded amount.

If you have loans that have been in repayment for more than 20 or 25 years, those loans may immediately qualify for forgiveness. Borrowers who have reached 20 or 25 years (240 or 300 months) worth of eligible payments for IDR forgiveness will see their loans forgiven as they reach these milestones.

But discharging student loans in bankruptcy is highly restricted and tougher than most other types of unsecured debt, like medical bills, credit card debts, or personal loans. You must not only file a Chapter 7 or Chapter 13 bankruptcy, but you also must file a separate lawsuit known as an adversary proceeding.

If you don't meet baseline eligibility requirements, or if you've previously defaulted on a loan, you may not be approved for a federal student loan. You must maintain "satisfactory progress" in school to be approved for student loans. You can take steps to regain or improve your eligibility for student loans.

If you're enrolled in an eligible college or career school at least half-time, in most cases your loan will be placed into a deferment automatically. You have the option to opt out of an automatic in-school deferment if you'd like to continue making payments.