Student Loan Forgiveness: How to obtain a Student Loan Forgiveness

This article contains valuable and comprehensive information about student loans, student loan forgiveness, and various types of loans available to students. Also, more details on Public Service Loan forgiveness and loans for teachers and nurses will be discussed as you read further.

Education is the bedrock of today’s society and it is acquired at a price that many may consider being steep. The financial status of students in a tertiary institution is quite different and yet some may have a greater passion to attain the best academic achievement.

However, the existence of financial challenges poses a threat to several students who are eager to accomplish a long-desired dream of obtaining a degree in colleges and universities. To ensure that every student gets an opportunity, a student loan, and student loan forgiveness programs are designed to tackle the monetary aspect of going through college.

If you intend to know more about student loans, student loan forgiveness, and other monetary aid allocated to students, read this article to the end to uncover every valuable information.

The best student loan is a federal-issued loan attached with fixed or lower interest rates. Also, private student loans are offered by private lenders consisting of banks, state loan agencies, union credits, and other financial institutions. 

Student Loan Forgiveness

What Is Student Loan?

Loans given to students are monetary aid to help students in tertiary institutions go through college. A student loan is organized to help students pay for essential fees and items in college. Tuition, supplies, books, and living expenses of students can be taken care of with this loan.

However, these student loans can be different from others in the aspect of interest, which the rate may be lower. The repayment schedule of the loan may be different even when the student is yet to graduate. Student loan varies according to each country’s strict laws regulating renegotiating and insolvency.

Attending any prestigious tertiary institution can be quite steep both for domestic and international students. Student loans are created to ease the financial burden of attending a college or university.

Also Read: Indian Scholarships to Study Abroad

Types of student loans available

Currently, student loans in the U.S are offered by two major lenders which are Federal student loans and private student loans.

Federal Student Loans are offered by the government of the U.S while private student loans are offered by state loan agencies, banks, credit unions, and other financial institutions. These loans are different from a student loan forgiveness.

Federal loans

The U.S government implemented the Federal Student Loans to aid students financially through college. It is highly recommended to use federal loans as they are attached with additional benefits and are less expensive than private loans.

There are a few considerations a student must look out for when applying for a loan. 

Below are the advantages attached to a federal loan.

  • Federal loans are fixed and they have lower interest rates
  • Getting a loan without a cosignatory
  • A possibility of a student loan forgiveness: this involves working in a certain profession like teaching or public service to repay the loan
  • Flexible repayment schedules, such as extended repayment and income-driven repayment
  • A repayment schedule that commences six months after a student graduates from school

The four types of federal student loans for college

Direct Subsidized Loan

Undergraduate students with financial needs can take advantage of the Subsidized Stafford loans made available to them. The Subsidized Stafford loans enable students not to pay interest on the amount they borrowed. Even while the student is in college at least half-time and for six months after graduation. This is an advantage for undergraduate students to save.

Direct Unsubscribed Loan

Undergraduate and graduate students have the Unsubsidized Stafford loans made available to them irrespective of their financial needs. The Unsubsidized Stafford loans are quite different compared to subsidized loans.

Also Read: Avoid Scholarship Scams – What You Need to Know

Federal Direct PLUS loan

Parents of undergraduate students who are dependent and graduate students can take advantage of the Grad PLUS and Parent PLUS loans. Loan interest starts accruing once the loan is disbursed because PLUS loans are not subsidized.

Federal Direct Consolidation loan

With Consolidation loans, you can combine many federal student loans into a single loan, and still enjoy the benefits of federal loans.

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Private loans

These are loans offered by a private lender which comprises banks, credit unions, state loan agencies, or other financial institutions. Private loans are usually attached with a fixed or variable rate of interest. Students who intend to procure a private loan are required to have a cosignatory and the interest is not subsidized.

What Is Student Loan Forgiveness?

Students in tertiary institutions with financial challenges tend to apply for student loans. These student loans can be federal or private loans attached with interest rates.

Student loan forgiveness clears the debt of students to repay part of their loan or all federal student loans that they borrowed. Most students in colleges and universities have taken loans to finance their stay in school. The loan enables students to pay for tuition, supplies, books, and other essential items.

Paying back these loans sometimes might be difficult to uphold and most students end up being in a huge amount of debt. Student loan forgiveness is an alternative method for students to pay back loans collected and it’s available for certain types of loans. With student loan forgiveness, students that are in debt can work in a certain public profession which can be educational or military professions.

How Student Loan Forgiveness Works

Student loan forgiveness exists to eliminate or take out parts of a student’s debt. Loan forgiveness applies to any student and student loan forgiveness applies to U.S government-issued or government-backed loans and they amount to 92% of all student loans in the U.S.

However, student loan forgiveness does not apply to private loans issued by banks, credit unions, state loan agencies, etc. There are situations where borrowers can have their loans forgiven or even better canceled totally. If you want your loans to be forgiven, you are mandated to apply and continue making payments until you get approval for your application.

Types of Student Loan Forgiveness

The types of student loan forgiveness are listed below.

Public Service Loan Forgiveness (PSLP)

The Public Service Loan Forgiveness Program is available only to those that work in public service jobs for nonprofit organizations or the government. Part of all of your loan can be forgiven if you provide volunteer work such as military service or medical practice.

There are a few requirements to meet before your debt is forgiven under the public service program. 

  • You are mandated to make 120 qualifying payments.
  • Payments are to be made while you are still working as an employee for a qualified employer which can be a federal, state, local government, or nonprofit organization that has tax-exempt status.

William D. Ford Federal Direct Loan Program which is a direct loan made by the U.S Federal government is eligible for student loan forgiveness. Loans issued by private lenders which are considered nonfederal loans are not included in this program.

In a circumstance where the William D. Ford direct loan is unavailable to you, and you got a loan through Perkins Loan Program, you can consolidate those debts to emerge as a direct consolidation loan.

A 2021 Revamp for PSLF

By normal Public Service Loan Forgiveness rules, the payment made alone on the joint loan is counted towards the 120 payment minimum. Initial payments that were made on the former loans were also considered and you have to be in one of the four income-driven repayment schedules owned by the government.

The U.S Department of Education made an official announcement in October 2021, to loosen program restrictions and it lasts till October 2022. Within this period, borrowers are likely to receive credit for previous payments made on loans, or else they won’t be eligible for Public Service Loan Forgiveness to reach the 12 payment mark.

Also Read: Do Scholarships Count as Income?

Income-Driven Repayment Forgiveness

Another type of student loan forgiveness is the income-driven repayment forgiveness. The U.S federal government offers four major income-driven repayment plans and they enable you to cap your loan payment at a particular percentage of your monthly earnings. If you are enrolled in any of these plans, whatever remains of your loan balance will be qualified for forgiveness after a time of 20 or 25 years based on the plan. 

Those who benefit from these plans are people with huge loan balances. According to National Consumer Law Center, only 32 individuals have had the honor to receive loan forgiveness via income-driven repayment forgiveness.

How to Apply For Public Service Loan Forgiveness (PSLF)

To successfully apply for Public Service Loan Forgiveness, you are required to fill an Employment Certification Form annually and also make pay stubs, W-2 forms, or other requested documentation.

However, if you successfully reach the requirements for repayment, you can submit a Public Service Loan Forgiveness application directly to the Department of Education. Once it is approved, the rest of your loan balance is forgiven. 

Although the Public Service Loan Forgiveness Program is uncertain till there is a submission of a plan by the U.S President Joe Biden or Congress.

There is a possibility of dividing monthly payments. For instance, those earning below $25,000 in a year and couples that earn below $50,000 will not spend a dime toward their loan until there is an increase in their income. 

Teachers Loan Forgiveness Program

The Teacher Loan Forgiveness Program was initiated to motivate teachers to work in elementary schools, secondary schools, and educational service agencies that specifically serve families with low income. Every year, the list of low-income elementary and secondary schools is published by the U.S Department of Education.

However, if a teacher wants a loan forgiven, they need to teach full-time for five straight years at a qualifying school. Once the process is completed, the teacher automatically becomes eligible to have within $5,000 and up to $17,500 loans forgiven.

The types of loans that are eligible are direct subsidized and unsubsidized loans only. Currently, there are up to 13 U.S states that provide loan forgiveness to teachers, and the requirements are different. The Teachers Loan Forgiveness Program can be applied upon completion of the Teacher Loan Forgiveness Application and submission to a loan servicer. 

Also Read: Federal Government Scholarship for Undergraduate / Postgraduate 2020

Loan Forgiveness for Nurses

In the medical field, registered licensed nurses, members of nursing faculty, and nurse practitioners, those working in areas with critical shortages can qualify and have up to 85% of their loans forgiven under a program named NURSE Corp Loan Repayment Program.

The qualified candidates can work for 2 years in an underserved area and have up to 60% of their student loan forgiven. An additional 25% of the loan can be forgiven for 3 years of working. Currently, 33 U.S states offer loan repayment assistance and you can go to the official website for Loan Forgiveness for Nurses to check if your state is among the 33 U.S states.

Loan Forgiveness for Doctors 

Those with professions in the healthcare system such as physicians, pharmacists, and dentists together with other healthcare workers are provided many alternatives to get loan forgiveness.

The amount that is forgiven and the requirements vary, and this depends on the program entered.

Student Loan Forgiveness Alternative

The standards to qualify for a student loan forgiveness eliminates many among the millions of existing borrowers. Signing up for one of the income-based programs is the most obvious for federal loans. These programs can modify your monthly payment depending on your income. So if you are earning less, you are not expected to pay more because of your earnings.


It is quite understandable why loans are made available to students. Going through college should not be denied to students who encounter financial hiccups. Although education in various prestigious colleges and universities can be quite steep. The need for monetary assistance is crucial.

With the federal and private student loans, students in colleges can take loans to help them get through school. Tuition, books supplies, and other essential items can be taken care of with these loans.

Student loan forgiveness presents an opportunity for students to repay part of their loan or they can be forgiven by providing a public profession in education, military, or medical practice.



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