Student loan forgiveness allows for all, or a portion, of your student loan debt to be removed.
Yes, you read that right. All of it, gone with the click of a button.
While the idea of having your student loan debt wiped out forever sounds dreamy, it isn’t that simple. While most federal loans qualify for student loan forgiveness programs, private student loans do not. Even then, each individual program will have its own unique requirements to qualify.
If you’re pondering the possibility of having your student loan debt forgiven, here’s what you need to know.
Jump Ahead > By Profession • By Loan Type • IDR Forgiveness • State-Sponsored Forgiveness • Discharge Programs • Student Loan Forgiveness FAQ
Student Loan Forgiveness: By Profession
Certain professions, typically those that serve our community, are eligible for several student loan forgiveness programs.
Public Service Loan Forgiveness
The Public Service Loan Forgiveness Program (PSLF) is a government program that was created under the College Cost Reduction and Access Act of 2007. With the goal to ease the burden of student loan debt for qualified public service workers, the program has forgiven the loans of over 460,000 student borrowers since its inception.
What You Need to Qualify
To qualify for PSLF, you will need to have made 120 on-time, qualifying monthly payments on a Direct Loan, while working for a qualifying employer. If so, the remainder of your federal student debt balance will be forgiven. Qualifying employers include U.S. federal, state, local, and non-profit organizations.
While it is ultimately your employer that determines whether you qualify, not your role itself, there are a variety of jobs that are often considered qualifying:
- Teachers, staff members, and administrators at public schools
- Law enforcement officers at the federal, state, or local level
- Employees of federal, state, or local agencies
- Military members
- Social workers at public service agencies
- Public health professionals such as doctors and nurses
- Employees at 501(c)(3) organizations
It’s important to note that the Public Service Loan Forgiveness program can be incredibly challenging to be accepted into. In fact, since 2020, only 2.16% of PSLF applications have been accepted. That said, we still recommend applying if you believe you qualify.
How Much Can Be Forgiven?
If you qualify, the remainder of your federal student debt balance can be forgiven.
Teacher Loan Forgiveness
Teacher Loan Forgiveness is a federal program that allows teachers to have a portion of their federal student loan debt forgiven.
What You Need to Qualify
To qualify, you must:
- Be a highly-qualified teacher
- Have taught at a low-income school or educational service agency for at least five consecutive school years
In terms of your student loans, you must not currently have, nor have in the past, any outstanding balance on your Direct Loans or Federal Family Education (FFEL) Loans as of October 1, 1998 (or the date you received your loans after that date). The loans must also have been borrowed prior to your five years of teaching.
How Much Can Be Forgiven?
If you are a full-time secondary-level science or mathematics teacher, or special education teacher, you may be eligible for up to $17,500 in student loan forgiveness. If you teach a different subject, you may be eligible for up to $5,000 in student loan forgiveness.
Student Loan Forgiveness for Nurses
Nurses are eligible for a variety of student loan forgiveness programs, such as Public Service Loan Forgiveness, Nurse Corps Loan Repayment, National Health Service Corps Loan Repayment, Perkins Loan Cancellation, and Army Nurse Corps Benefits/Health Professions Loan Repayment.
Nurse Corps Loan Repayment
The Nurse Corps Loan Repayment program is offered by the Health Resources & Service Administration. The program provides student loan forgiveness for nurses that work in critical shortage facilities, or healthcare facilities lacking primary, mental health, and dental care.
What You Need to Qualify
To qualify, you must:
- Be either a registered nurse (RN), nurse faculty (NF), or advanced practice registered nurse (APRN)
- Work full-time in a critical shortage facility or accredited nursing program
- Have attended a qualifying nursing school in the United States
How Much Can Be Forgiven?
If you qualify, you can have up to 85% of your nursing school debt forgiven.
National Health Service Corps Loan Repayment
The National Health Service Corps (NHSC) Loan Repayment Program is also offered by the Health Resources & Service Administration. However, the eligibility criteria is a bit stricter in comparison, and the program requires you to serve two years at an NHSC-approved site.
What You Need to Qualify
To qualify, you must:
- Be a U.S. citizen
- Be fully trained and licensed to practice in an NHSC-approved primary care medical, dental, or mental health discipline in which you apply to serve
- Be a provider in the Medicare, Medicaid, and State Children’s Health Insurance Program (as applicable)
- Be a health professional in an eligible discipline with qualifying student loan debt for your degree
- Be working at an NHSC-approved site
How Much Can Be Forgiven?
The amount you can get forgiven depends on your level of participation in the program. If you serve full-time, you can receive up to $50,000 in student loan repayment for the initial two-year term. If you serve part-time, you can receive up to $25,000 for a two-year term.
Army Nurse Corps Benefits/Health Professions Loan Repayment
If you are a nurse on active duty or in the Army Reserve, you may be eligible for a substantial amount of student loan forgiveness.
What You Need to Qualify
To qualify, you must be a nurse on active duty or in the Army Reserve.
How Much Can Be Forgiven?
If you qualify, you can receive up to $250,000 in student loan forgiveness.
Military Student Loan Forgiveness and Assistance
Members of the military are eligible for several student loan forgiveness programs including Public Service Loan Forgiveness, National Defense Student Loan Discharge, and Veterans Total and Permanent Disability Discharge.
National Defense Student Loan Discharge
National Defense Student Loan Discharge is a federal program available to students who have served in the military.
What You Need to Qualify
To qualify, you must have served 12 consecutive months in a duty station that qualified you for either imminent danger or hostile fire pay. You must also have Federal Perkins Loans or Direct Loans to qualify.
How Much Can Be Forgiven?
The amount you can have forgiven depends on a variety of factors. For more information on how much you may be eligible for specifically, contact your loan servicer.
Veterans Total and Permanent Disability Discharge
If you are a veteran with a service-related disability, the Veteran Total and Permanent Disability Discharge program may be able to help you.
What You Need to Qualify
To qualify, you must be able to provide proof that you are permanently disabled, including appropriate documentation from the Department of Veteran Affairs.
How Much Can Be Forgiven?
This program can forgive up to your entire remaining loan balance.
Student Loan Forgiveness: By Loan Type
While most of the above student loan forgiveness programs are for Federal Direct Loans and Federal Family Education Loans, Parent PLUS Loans and Perkins Loans are also eligible for some forgiveness programs.
Parent PLUS Loan Forgiveness
Parent PLUS Loans are eligible for certain forgiveness programs such as PSLF and Military Loan Forgiveness. You can also receive loan forgiveness on Parent PLUS Loans by opting into an income-driven repayment plan or working for a federal agency that offers debt forgiveness benefits.
Perkins Loan Cancellation
If you qualify for Federal Perkins Loan Teacher Cancellation, you can have 100% of your Perkins Loan(s) canceled. To qualify, you must have served full time in a public or non-profit elementary or secondary school system as a:
- Teacher working with students from low-income families;
- Special education teacher; or
- Math, science, foregin language, or bilingual education teacher (or any other field of study deemed by the state education agency to have a shortage of qualified teachers).
Other Student Loan Forgiveness Programs
Income-Driven Repayment Loan Forgiveness
Income-driven repayment (IDR) is a federal loan repayment option that bases your monthly payment on your income instead of your remaining loan balance. After 20-25 years of qualifying payments on an IDR plan, your remaining student loan balance can be forgiven.
State-Sponsored Repayment Assistance Programs
Some states offer robust student loan assistance programs. For example, Iowa currently offers six assistance programs, one of which being the Teach Iowa Scholars program that provides qualifying first-year Iowa teachers with $4,000 per year for teaching in designated shortage areas. Likewise, New York offers nine assistance programs, one of which offering qualified social workers up to $26,000 in debt assistance. Check your state’s website to learn more about their student loan assistance programs.
Loan Discharge Programs
Loan discharge removes your obligation to repay your debt in certain circumstances. While similar to student loan forgiveness programs in that the remainder of your student debt can be forgiven, it differs in that loan discharge is typically only granted for extenuating circumstances.
The following are the most common discharge programs offered for student loans.
Closed School Discharge
Closed school discharge is designed to offer loan discharge to students whose school closed while they were still enrolled or shortly after they withdrew. If you qualify for a closed school discharge:
- You will no longer be obligated to make payments on your federal student loan debt,
- You will receive reimbursement for any payments you have already made, whether voluntarily or through forced collection; and
- Any record of the loan and repayment history associated with it will be deleted from your credit report.
Borrower Defense to Repayment Discharge
The Borrower Defense to Repayment Discharge program is designed to assist students whose schools misled them or participated in misconduct that violated state laws. This program can remove all or some of your federal student loan debt.
Total and Permanent Disability Discharge
If you have become totally and permanently disabled, you may qualify for Total and Permanent Disability Discharge. To qualify, you must be able to provide documentation of a disability from a qualified source such as the U.S. Department of Veteran Affairs, the Social Security Administration, or a physician.
Many private student lenders also have a total and permanent disability discharge program. To check if your lender does, reach out to them directly.
Discharge Due to Death
Should a student loan borrower die, their federal student loan debt will be discharged. Parent PLUS Loans borrowed on behalf of a now-deceased student also qualify.
Frequently Asked Questions About Student Loan Forgiveness
Can I Get My Student Loans Forgiven Due to COVID-19?
While the COVID-19 pandemic has impacted many borrowers’ ability to repay their student debt, the pandemic itself is not grounds for student loan forgiveness. As a result of the pandemic, however, federal student loans are in forbearance.
That said, there have been motions to forgive up to $20,000 per borrower in student loan debt. However, litigation is currently blocking these motions from moving forward.
As a result, the forbearance has been extended until 60 days after the litigation is resolved or debt is forgiven. If neither happen before June 30th, payments will resume 60 days after that.
Are Student Loans Forgiven After 10 Years?
Student loans are not automatically forgiven after 10 years. However, if you were approved for Public Service Loan Forgiveness, you will be granted student loan forgiveness after 120 qualifying payments, or around 10 years.
Is There an Income Limit for Student Loan Forgiveness?
Currently, there are no income restrictions for federal student loan forgiveness programs.
Can You Make Too Much Money to Qualify for PSLF?
There are currently no income restrictions for the Public Service Loan Forgiveness Program. However, to qualify, you must be on a qualifying repayment plan, many of which are income-driven repayment plans. If your income is too high relative to your outstanding balance, you may not qualify for an income-driven repayment plan.
Is Loan Forgiveness Taxable Income?
Student loan forgiveness granted under the Public Service Loan Forgiveness Program is not considered taxable income. Loans that were forgiven under discharge programs, however, are typically considered taxable income.
Final Thoughts from the Nest
When researching student loan forgiveness programs, be weary of scams. If a program calls you directly, requires you to make decisions “immediately” or with any sense of urgency, or requires you to pay upfront to have your debt forgiven, do not move forward with the program.
If you have questions about which student loan forgiveness programs may be available to you, it’s best to contact your loan servicer directly for more information.