How to Receive Student Loan Help Through Student Loan Forgiveness

student loan help

Did you know that one-fourth of the American workforce may be eligible for repayment or student loan-forgiveness programs?

If you dream of the day you will be out of student debt and are looking student loan help, you have options. In fact, you have several.

Continue reading to learn about the different ways you can apply for and receive student loan forgiveness!

How To Receive Student Loan Help Through Student Loan Forgiveness

The Different Ways to Get Federal Student Loan Forgiveness

If you want student loan help through student loan forgiveness, there are four primary programs that will cancel or reduce your federal loan balance. The qualification for each program is based on your job or on the repayment plan that you choose.

You should also note that private student loans do not offer forgiveness. However, some lenders will let you make interest-only payments or take temporary interest rate reduction if you’re having trouble affording the bill.

Keep reading for more info on these 4 ways to get federal student loan forgiveness.

1. Public Service Loan Forgiveness

The first way to get student loan help through student loan forgiveness is by applying for Public Service Loan Forgiveness, which started in 2007.

How it works is that if you work full time for a nonprofit or for the government for at least 10 years, your remaining federal loan balance will be forgiven.

There are many kinds of qualifying workers, including firefighters, teachers, military personnel, nurses, and more.

In order to save the most money on Public Service Loan Forgiveness, you’ll need to repay your loans on an income-driven plan for those 10 years.

Since the program started 10 years ago, the first Public Service Loan Forgiveness recipients will have their loans discharged this year!

Which Loans are Eligible?

For this program, only federal direct loans are eligible. However, you can consolidate other student loan types in order to repay them on Public Service Loan Forgiveness.

However, you may want to consider keeping your Perkins loans separate if you qualify for a Perkins loan cancellation.

2. Teacher Loan Forgiveness

Because of the way Teacher Loan Forgiveness works, teachers who work full time for five consecutive years can have up to $17,500 in direct or Stafford loans forgiven.

This program is available only to those teachers who work in low-income public elementary or secondary schools. Additionally, to qualify, teachers much have taken out their first loans after October 1, 1998.

This program is best for you if you plan to teach full-time in a low-income public school for at least five years and have a loan balance of $17,500 or less.

This means that if you have a loan balance larger than that and plan to teach for 15 years or more, you’ll want to instead consider enrolling in Public Service Loan Forgiveness after five years.

Which Loans are Eligible?

Direct loans and Stafford loans are both eligible for this program.

3. Perkins Loan Cancellation

The good news about the Perkins Loan Cancellation is that borrowers with federal Perkins loans can have up to 100% of their loans canceled!

For the Perkins Loan Cancellation, you need to work in public service jobs. The loan can generally be canceled after five years.

Among those eligible for cancellation are teachers, firefighters, nurses, police officers, school librarians, public defenders, and more.

Which Loans are Eligible?

Only Perkins loans are eligible.

The amount of Perkins loans you can borrow as an undergrad is $27,500. However, as a grad student, you can borrow more. An additional $32,500 is available for those who are grad students.

4. Income-Driven Repayment

Income-driven repayment works for those looking for student loan help because the federal government offers four main income-driven repayment plans.

These repayment plans allow you to pay a percentage of your monthly income toward your loans.

Your four options for student loan help down this path include the following:

  • Income-based repayment
  • Income-contingent repayment
  • Pay As You Earn
  • Revised Pay As You Earn

Which Loans are Eligible?

Loan requirements for this option vary among the plans.

As a general rule of thumb, if a loan type isn’t eligible for income-driven repayment at first, it will be once it’s consolidated into a Direct Consolidation Loan.

How to Apply for Student Loan Forgiveness

Public Service Loan Forgiveness

To apply, for Public Service Loan Forgiveness, call your student loan servicer–this is the company that manages your federal loans.

Let them know that you’re interested in the program and confirm that you do in fact qualify.

The company will be able to tell you if you need to consolidate your loans in order to make them eligible. They’ll also be able to give you info on what initial paperwork you need to fill out.

You and your employer should fill out the employment certification form either annually, or whenever you change jobs. This will help you make sure you’re on the right track for forgiveness.

Since the program began on October 1, 2007, you’re eligible once you’ve made 120 on-time loan payments following that date. The application will be available by October of this year.

Teacher Loan Forgiveness

First, to apply for Teacher Loan Forgiveness, you will need to complete the five-year teaching requirement.

After you’ve completed the time requirement, fill out the application and send it to your student loan servicer.

Perkins Loan Cancellation

Note that Perkins loans are disbursed to borrowers directly by their college.

Therefore, you’ll first want to call the financial aid office at your college and ask for a loan cancellation application.

In most cases, your loans will be discharged incrementally each year that you serve.

For the Perkins Loan Cancellation to be successful, you must show proof that you work in a qualifying public service job during the period you apply for forgiveness.

Income-Driven Repayment

The first step to apply is to fill out an Income-Driven Repayment Plan request. Then, return it to your servicer.

In order to stay on the plan you choose, you must re-certify your income every year.

Keep in mind that for this path to student loan help, there’s no separate forgiveness application. Instead, your loans will be forgiven automatically after 20 or 25 years. The length of time depends on the plan.

Income-Driven Repayment Plans may also be an attractive option because they feature a retroactive forgiveness component that forgives the remainder of the loan no matter how much has been paid back.

If you’re interested in student loan help, which of the options above do you qualify for and are most likely to take advantage of? Tell us your next move towards getting rid of your student loans in the comments!