Student Debt Forgiveness, Cancellation, and Discharge
Public Service Loan Forgiveness
The Public Service Loan Forgiveness program (PSLF) forgives the remaining balance on federal Direct Loans for employees of charitable nonprofits and government organizations after those employees make qualifying payments for 120 months (10 years). PSLF requires being on an income driven repayment plan and can be a great option for many borrowers to see relief from their student debt burden.
The basics of PSLF center around 1) working for an eligible employer; 2) making eligible payments; 3) regularly certifying your employment.
Working for an Eligible Employer: Nonprofits, government organizations, and some other public service professions all qualify for PSLF. Make sure you check your specific employer’s eligibility!
Making Eligible Payments: Income Driven Repayment plans are all qualifying payment plans, and ensure you get maximum benefit from PSLF. Make sure you apply for an IDR plan and recertify your income every year to stay in good standing! Payments should be made in full each month to count for PSLF.
Certifying Your Eligible Employment: It’s recommended to submit a PSLF Form signed by your employer at least once a year to ensure you are progressing as expected toward PSLF. Luckily, StudentAid makes it easy to submit PSLF forms to your employers past and present with their PSLF Help Tool, that allows you to submit the form electronically. If you certify regularly, make progress over time, and then certify a final time after your 120th payment, you can be FULLY FORGIVEN!
- Learn the basics here: https://studentaid.gov/manage-loans/forgiveness-cancellation/public-service
- Utilize the PSLF Help Tool on StudentAid to certify your eligible employment: https://studentaid.gov/pslf/
For a step-by-step breakdown to access the program, view this guide: https://www.cancelmystudentdebt.org/pslf-step-by-step-guide
Public Service employers can benefit from sharing this information with their staff and constituents, too. View a guide for employers here: https://www.cancelmystudentdebt.org/pslf-employer-toolkit
Income-Driven Repayment and Forgiveness
Income-Driven plans also offer an opportunity for debt forgiveness through “Income Driven Repayment Forgiveness” after 20 -25 years (depending on your plan). This means that borrowers who pay diligently and on time for 20-25 years can become student-loan debt free, regardless of how much they have paid over time.
For a video explainer on the IDR Forgiveness option and how to maximize your benefit, click here: https://www.cancelmystudentdebt.org/items/maximizing-the-benefits-of-the-idr-account-adjustment
The SAVE plan also offers “early IDR forgiveness” for those with lower original loan balances. Actual time required will depend on your original balance and whether your loans are from graduate or undergraduate education, but original loan amounts $12,000 or less can achieve forgiveness in as little as 10 years. Learn more about SAVE forgiveness here: https://studentaid.gov/announcements-events/save-plan#early-forgiveness
Other Discharge, Cancellation, and Forgiveness
There are other options for discharging your student debt besides PSLF and IDR forgiveness, if you meet certain requirements. Other cancellation and forgiveness options include:
- Total and Permanent Disability Discharge
- Teacher Loan Forgiveness
- Federal Perkins Loan Teacher Cancellation
- Military Benefits