How do you qualify for debt forgiveness?
Borrowers with undergraduate debt would qualify for forgiveness if they entered repayment 20 years ago or more, and borrowers with graduate school debt would qualify for forgiveness if they entered repayment 25 years ago or more. Cancel
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.
Public Service Loan Forgiveness (PSLF)
The PSLF Program forgives the remaining balance on your Direct Loans after you've made the equivalent of 120 qualifying monthly payments while working full time for a qualifying employer.
Debt forgiveness is a process where a creditor pardons a debtor from part or all of their outstanding debt. Various types of debt may qualify for forgiveness. Debt forgiveness can offer relief from overwhelming financial burdens, but it does have downsides. There are alternative options for managing debt.
Qualifying repayment plans include all income-driven repayment (IDR) plans (plans that base your monthly payment on your income and household size) and the 10-year Standard Repayment Plan. The four IDR plans we offer include: Saving on a Valuable Education (SAVE) Plan—formerly the REPAYE Plan.
Private education loans aren't eligible for PSLF and can't be consolidated into a Direct Consolidation Loan. Are Direct Loans that are in default eligible for PSLF? No. Defaulted Direct Loans are not eligible for PSLF and payments made while the loan was in default cannot count toward the 120 required payments.
It's also important to note that debt forgiveness differs from debt relief, which involves reorganizing debt to facilitate repayment—but doesn't cancel the debt. Continue reading to learn more about debt forgiveness and explore different options that you may qualify for.
Borrowers with undergraduate debt would qualify for forgiveness if they entered repayment 20 years ago or more, and borrowers with graduate school debt would qualify for forgiveness if they entered repayment 25 years ago or more. Cancel student debt for borrowers previously enrolled in low-financial-value programs.
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.
Begin the student loan forgiveness application process
For PSLF you must make 120 on-time payments while working for a qualifying employer. That's 10 years of on-time payments, so it may be a while before you qualify.
How do I ask for debt forgiveness?
The borrower can apply for debt forgiveness on compassionate grounds by writing about the financial difficulties and requesting the creditor to cancel the debt amount.
If you're struggling with credit card debt, you may be wondering if there's a government program that can provide relief. While there isn't a specific credit card debt relief program operated by the government, several options are available that can help you manage and reduce your debt.
National Debt Relief, a debt settlement firm, negotiates with creditors to reduce consumer debt. They offer free consultations and will customize plans to make debt payoff affordable. Depending on factors like your debt size, budget and negotiated amount, you could pay off your debts within 24 to 48 months.
Under the original program rules, a Qualifying Payment means that, in that month, you were working an average of 30 hours per week for one or more qualifying employers and making on-time, in-full payments on a Direct loan while enrolled in an Income-Driven-Repayment plan.
A qualifying student loan payment consists of the following: under a qualifying repayment plan. for the full amount due as shown on the monthly statement. within 15 days after the due date. while the borrower is employed full-time in a qualifying job by a qualifying employer.
A "qualifying loan" is a loan you took out solely to pay qualified education expenses that were: For you, your spouse, or a person who was your dependent when you took out the loan, Paid or incurred within a reasonable period of time before or after you took out the loan, and.
Defaulted loans are not eligible for loan forgiveness under the TEPSLF opportunity. Here's what you should do next: You should get out of default if you can, but any payments that you make while you are in default cannot count as qualifying payments for PSLF or TEPSLF.
What will happen if my Public Service Loan Forgiveness (PSLF) application is denied? If we determine that you're not eligible for loan forgiveness at this time, you'll be notified and will be provided with the reason(s) we determined you were ineligible. You'll then be required to resume making payments on your loans.
Private student loans are rarely forgiven. Generally, it only happens if the borrower becomes permanently disabled or dies. If you have a private student loan, you won't receive forgiveness after working in a public service industry and paying down your balance over a certain number of years.
The Bottom Line
National Debt Relief is one of the best companies when it comes to debt settlement—but debt settlement is risky, and it's costly even when it's successful. Debt settlement companies like NDR can and do provide help to people who need it.
Can credit card debt be forgiven?
Credit card debt can be overwhelming — but it can also be forgiven in some cases. If you have a significant amount of debt compared to your income, you may qualify for credit card debt forgiveness, so consider reaching out to a debt settlement company for help.
For example, if a borrower took out $13,000 in loans, they would be eligible for debt cancellation after 11 years in repayment. Under Public Service Loan Forgiveness, borrowers in public service for 10 years who have made 120 months of qualifying payments can get their remaining student debt canceled.
A final review of your account will be done to process forgiveness, which will take at least 90 business days. You are required to continue making payments while your form is being processed, unless your account is in a forbearance status.
Typically, months in forbearance and deferment do not count towards PSLF. However, months during the COVID-19 payment pause (March 2020-September 2023), months that qualify under the IDR Adjustment, and months where loans are being placed on administrative forbearance after the repayment restart will count toward PSLF.
The Bottom Line. Although loan forgiveness can impact a credit score, the effect is often temporary.
