Understanding Student Loan Forgiveness, Cancellation, Discharge and Repayment Plans

Student loan debt is higher than ever. Students are taking out federal and private loans to pay for college costs, which often take years to pay back. On average, they pay off their debt in 20 years. For some professional graduates, it takes more than 45 years to clear.

This kind of debt can weigh heavily on a person, especially if they aren’t making enough money to keep up with their monthly payments and rising interest. That’s why they may look into student loan forgiveness, cancellation, discharge and repayment plans.

If you are facing mounting student loan debt, you have options. By learning about them, you attempt to free yourself completely of this debt, or, at the very least, make it easier to pay.

Forgiveness, cancellation and discharge all mean that you don’t need to repay some or all of the loan. There are also such things as repayment plans. Find out what each one means so you can explore the different choices you may have.

The U.S. government has been trying to address the student loan debt crisis — Americans owe $1.75 trillion in federal and private student loan debt. As of February 2022, the Biden Administration approved $415 million in a student loan forgiveness program for borrowers who were defrauded by their schools. These are usually for-profit schools that misrepresent themselves to students. This is called the Borrower Defense Program. Under it, 16,000 borrowers will receive student loan forgiveness.

Borrowers who qualify will be contacted, but if you believe you are eligible for this program, you can use the following resources.

• StudentAid.gov: On this official government website, you can find out more about the program. Also, you can see if you qualify.
• Borrower Defense Program Application: Do you think you are eligible? Then apply for the Borrower Defense Program on this site.

If you’re struggling to cover the costs of your loan payments, loan forgiveness, cancellation and discharge programs may offer you a good solution. Learn more about what these options include below to help you determine which one is best for you.

Different federal programs offer you student loan forgiveness or cancellation of your debt. You’ll need to look into the choices to see which ones you may qualify for. Please use the tables below and add in the programs in the appropriate table.

You may be eligible for forgiveness, cancellation or discharge if you go into a certain profession. For example, if you become a medical professional, teacher or doctor, or you go into the military or public sector, you could become eligible. This is to encourage people to go into these fields.

You could also get your loan discharged, forgiven or canceled if you experience disability or bankruptcy or you pass away — then your family wouldn’t have to have to pay back your loan. It all depends on whether or not your disability prevents you from working or you qualify for discharge due to hardship under your bankruptcy filing.

If you pass away with student loan death, your family can take the appropriate steps to get it discharged so they don’t have that extra burden on them.

If you have a disability and you are unable to work, then you could potentially qualify for a program for individuals with disabilities.

There is a myth that you cannot get student loan debt discharged. You can, but it certainly is going to be harder than trying to get other types of debt discharged. Filing for Chapter 7 or Chapter 13 is not enough; you will also have to file an adversary proceeding.

You can apply for forgiveness through StudentAid.gov. It depends on the program you are applying for. Navigate to that official government website to find the specific application you need. You will need to prove how you qualify. There is no average timeframe for when you will hear a reply.

If you get approved for student loan forgiveness, there are a few different things that will occur.

There is the possibility that you will be denied for student loan forgiveness. Here are some steps you should take if that occurs.

If you don’t qualify for forgiveness, cancellation or discharge, it can be disheartening. But there are other options you can go after depending on your specific situation. You don’t need to give up at this point. It may take some time and creative thinking, but there are alternative solutions.

If you are not a candidate for forgiveness, cancellation, discharge or repayment, then there are other roads you can go down. They include debt strategy plans, refinancing, budgeting and more. With a plan of action in place, you can pay off your student loan debt sooner and hopefully relieve yourself of this burden once and for all. Then, you can start to save for your future and fulfill your financial goals.

There are many resources available to help when it comes to student loan forgiveness. Here are some places to start.

• Aid for Military Families: Find out more information on student aid help for military families if you are serving your country.
• Experian: Check out your credit report and score and see how your student loan debt is playing a part in your score.
• Household Budget Worksheet: Here is a budgeting sheet that will help you track and manage your monthly expenses.
• Legislative Tracker: Loans & Repayment: Find out about legislation that is handling the student loan crisis in the U.S.
• Student Loan Borrower Assistance — Bankruptcy: Discover if bankruptcy is the best option for you by navigating to this website.
• tudent Loan Forgiveness: You can learn all about student loan forgiveness and apply for a program on the federal government’s official website.
• Student Loan Forgiveness by State: Learn about your state’s specific programs to help people struggling with student loan debt.
• Student Loan Repayment: On this official government website, you can discover more information about repaying your student loans.
• U.S. Department of Education: Navigate to this official government website whether you are looking for a loan or you already have one.