Student loan forgiveness programs
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When you think of loan forgiveness, chances are the only program that comes to mind is the Public Service Loan Forgiveness program for federal loans.
But loan forgiveness isn’t limited to government workers with federal loans. Depending on your field, you might be eligible for several forgiveness programs — even for private loans. We break down your top options for forgiveness on your student loan debt.
You might not necessarily qualify now — but you could. That is, if you’re willing to make a few tweaks to your career path. Most forgiveness programs require you to commit a couple of years to working at a nonprofit or organization, typically one serving underrepresented communities or needing more professionals. You might not make that huge salary you envisioned, but you could end up with a lot less debt.
Loan forgiveness programs generally fall into two types: programs for federal loans and loans specific to your profession. If you don’t have federal loans, check out forgiveness programs looking for people with your skills or educational background. Federal loans tend to attract more forgiveness options, but you might have to creatively poke around to discover them.
This popular student loan forgiveness program is for those who want to give back to their community. You’ll need to work a government or nonprofit job for at least 10 years to qualify, after which the government forgives the load of your remaining student debt.
Federal Student Aid recommends that you sign up for an income-driven repayment plan if you’re planning to take advantage of PSLF — qualifying jobs are often low-paying, resulting in low repayments under such a plan.
Only student loans borrowed through the federal direct program can qualify:
You must make 120 repayments while working full time at a public service job with a qualified employer, including:
Nonprofits that aren’t tax-exempt are qualifying public services if they provide:
PSFL created in 2007 to provide an economic incentive for highly educated students to take low-paying public service jobs. However, it costs a lot of taxpayer dollars, and there have been proposals to limit how much debt you can have forgiven or even canceling it altogether.
For now, it’s still up and running — though the Department of Education has rejected 99% of PSLF applications as of June 2018. Most people were rejected because they misunderstood the requirements — they didn’t work at an eligible job, didn’t make 120 qualifying repayments or work enough hours. Check out these expert tips for qualifying for PSLF to increase your chances of approval.
You might have also heard about this program for teachers. To qualify, you must teach at a low-income school or education service agency for at least five consecutive years while paying off your student debt.
Unlike PSLF, the amount of student debt that’s eligible for forgiveness is capped at $17,500 — but you’re only required to put in half the service years.
As it does for PSLF, Federal Student Aid recommends that you pair this program with an income-driven repayment plan, because education jobs tend to start at low salaries.
If you’ve consolidated your student debt with a Direct Consolidation or Federal Consolidation loan, the government forgives only the amount originally taken out under one of the four qualifying loans.
To qualify for this forgiveness program, you must:
To meet the government’s requirements of a “highly qualified teacher,” you must show that you’ve:
If you’re a new teacher, you must also prove that you’ve passed rigorous state testing in various academic subjects and, depending on your teaching level, advanced courses in the subject you teach.
Even if you don’t qualify for a federal forgiveness program, you might have your student debt forgiven by signing up for an income-driven repayment plan.
While federal income-driven plans work similarly, they differ when it comes to:
How IBR works depends on when you took out your student loans:
Each year, the government recalculates your repayments based on your income and family size. The government also considers your spouse’s income and debt if you file a joint tax return.
You qualify only if the amount you’d repay each month under a 10-year Standard Repayment Plan is higher than 10% or 15% of your income, depending on when you took out your loan. Generally, if your debt load is higher than your annual salary, you qualify.
This income-driven plan is like IBR, but it’s available for fewer loan types and further restricts who qualifies.
With this plan, you’ll make monthly repayments of 10% of your income, which the government calculates each year and adjusts based on your income and family size. Like with IBR, your spouse’s income and debt factors into these calculations if you file your taxes jointly.
The government forgives the balance of your federal debt after 20 years of repayments.
Like with IBR, you qualify for this loan if the amount you’d repay each month under a 10-year Standard Repayment Plan is higher than 10% of your monthly income. You also can’t carry any loans issued before October 1, 2007, or direct loans disbursed before October 1, 2011.
This revised version of PAYE uses a new way of calculating your income and bases forgiveness on the type of degree your loan paid for. It also doesn’t require you to have a high debt-to-income ratio to qualify.
Under this plan, monthly repayments reflect 10% of your monthly income after taxes. However, the government counts your spouse’s debts and income when calculating your repayments, regardless of how you file your taxes.
Forgiveness eligibility depends on the degree level you’re paying off:
Anyone with an eligible direct loan can qualify regardless of income.
ICR is the only income-driven option that allows Direct Parent PLUS loans, but these loans must be part of a Direct Consolidation loan to qualify. Like PAYE and REPAYE, only direct loans are eligible for this plan, but you won’t need to meet specific borrower requirements.
Through this plan, each month you’ll pay the lesser of:
Like with other income-driven loans, the government recalculates your payments each year based on your income, family size and direct loans balance. It only considers your spouse’s income or debts if you file taxes jointly or if choose to repay your direct loans together.
Your loans are forgiven after making 25 years of repayments on this plan.
Anyone with an eligible student loan can qualify.
Federal Perkins Loans were offered based on a student’s financial need, though the Department of Education recently phased them out. It offers up to 100% cancellation on Perkins loans for teachers who work in an eligible position for five years.
You might also be able to qualify for partial or full cancellation after working up to seven years at another public service job. Volunteer work can also help you qualify for this loan cancellation program.
Along with other reasons for discharging your student loans, you can also discharge your Perkins Loans if:
You don’t need to qualify for a federal Teacher Loan Forgiveness to get help with paying off your student debt as an educator. Most states offer loan repayment assistance programs for teachers that often care more about what you do than the type of debt you have. To qualify, you’ll typically need to be licensed in that state and work in a qualifying area for at least two years — usually serving low-income students.
Like with Perkins Loan forgiveness, these programs often forgive a percentage of your debt for each year of eligible work. The best way to find out how this works in your state is to go directly to state legislature. Each state determines how much and how many applicants they accept into the program in the state’s budget, which can change every few years. The Teach for Texas Program, for example, no longer accepts new applicants due to budget cuts.
As a lawyer, you can get repayment assistance not only from local and national government programs, but also from your former law school. Schools like Harvard, Columbia, Duke and most state schools offer some type of student loan repayment assistance if you earn less than a specified amount each year or work in a qualifying field.
You can also sometimes get forgiveness through your local bar association. This might be a good bet if you don’t qualify for federal assistance — they’re sometimes designed as an alternative.
Below are three top loan repayment assistance programs lawyers from all around the country might want to look into.
Lawyers working in the public sector will want to check out this program. You could be eligible to earn up to $60,000 in student debt assistance — or $10,000 per year.
You could get up to $60,000 in repayment assistance if you work for the Department of Justice for at least three years.
The Legal Services Corporation (LSC) started this program in 2005 to help LSC-funded legal programs retain staff and find qualified attorneys. You’ll have to work at an LSC-funded organization, and only 70 attorneys can qualify each year through a lottery system. But you can get up to $5,600 in student loan repayment assistance for each year you qualify.
Nurses can access several federal and state repayment programs designed to provide repayment assistance for any type of student loan. To qualify, you typically need to commit to working in an area with a nursing shortage or with a high-needs population for at least two years.
One program to consider is the NURSE Corps Loan Repayment Program, which is available nationwide. It forgives up to 60% of your student loan debts after you work for two years in an eligible high-needs area. Work three years, and you could see 85% of your student debt forgiven.
Otherwise, look to your state for repayment assistant programs for nurses. For example, New York State can forgive up to $40,000 of your student debt or $8,000 per year of qualifying work.
Many states have loan repayment assistance programs for nurses that work in that specific area or serve specific communities. You can learn more about LRAP programs by consulting your former nursing school’s financial aid department or searching for programs in your area.
Doctors, pharmacists and other healthcare professionals have lots of options when it comes to getting assistance with student loan repayments. And they better — those degrees can set you back as much as $400,000 or higher.
These are some of the top programs that people working in healthcare might want to consider.
Still in medical school? During your last year, you can qualify for this program that forgives up to $120,000 of your student debt. You’ll have to commit to working for at least three years as a primary healthcare provider at an approved site in an area with a shortage of medical professionals. Your work starts after you finish your residency.
The program forgives most student loans, excluding Parent PLUS or loans used to pay for a residency. Refinanced or consolidated loans are also accepted, as long as they’re exclusively student debt.
Students to Service gives priority to borrowers who come from a disadvantaged background or are likely to continue working in disadvantaged areas.
This NHSC program is similar to the S2S program, only it’s for licensed healthcare providers. You can get up to $50,000 in student loan repayment assistance as long as you commit to working for two years at an NHSC site in an area that lacks medical professionals.
Helps with all student loans, except those used to pay for residency-related expenses.
You must be a primary care doctor, dentist or mental healthcare provider and commit to two years of work at an NHSC site.
The IHS — an agency that works with the Department of Health and Human Services — started its loan repayment program with the intention of attracting doctors to work in American Indian and Alaska Native communities. The program pays off $40,000 of your student debt in exchange for a two-year service commitment.
Accepts any student loan used to pay for your medical-related degree.
The NIH has several loan repayment programs that forgive up to $35,000 in student loan debt per year for biomedical or biobehavioral researchers. In exchange, researches must commit to research projects that are relevant to the NIH’s mission.
The NIH accepts applications from September to June, though it depends on the program you’re applying to. Each program has different eligibility requirements, so read the instructions carefully to make sure you’re applying to the right program.
Many states also have loan repayment assistance programs (LRAPs) for healthcare professionals that offer funds to go toward your student loans. These tend to be for certain types of professionals serving specific communities. You might want to consult your former school’s financial aid office or search for funding options by location and specialization.
Members of the military typically get more leeway when it comes to paying off student debt. After all, it’s not easy to make repayments from an active war zone.
Not only can you qualify for PSLF if you’re a member of any branch of the military, but the military also offers loan forgiveness programs for Army, Air Force and Navy doctors.
Members of the Army, Navy, National Guard and Air Force are also eligible for loan repayment assistance. The Army and the Navy pays up to $65,000, while members of the National Guard can get up to $50,000 in loan repayment assistance.
There are several forgiveness and LRAPs for medical professionals in the armed forces. The Navy Financial Assistance Program offers partial forgiveness medical and dental residents who are working toward a specialty the Department of Defense considers critical.
Doctors in the Army can also qualify for up to $40,000 per year for two years in repayment assistance through the Active Duty Health Professions Loan Repayment Program. Contact your recruitment officer for more details.
Discharge and forgiveness are similar terms: In the end, you’re no longer on the hook for paying off your student debt. While forgiveness is typically an incentive for people to work in low-paying or underserved areas, discharge generally applies to extreme situations that keep you from making on-time repayments.
When it comes to federal loans, your student loans might be discharged in seven scenarios:
While student loan forgiveness has been considered taxable income in the past, the most recent stimulus bill passed in March 2021 amends this. Nearly all student loan forgiveness — including for private loans — is no longer considered gross income. This means that it won’t be taxed.
It covers five types of loans:
This ruling takes effect for student loans forgiven between December 31, 2020 to January 1, 2026.
Learn more: Our guide to federal student loan legislation
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Student loan forgiveness isn’t just for borrowers with federal loans — though your options are limited when you’re looking to have your private student loans forgiven. Most programs act as incentives to attract professionals into specific fields of service. You’ll likely need to commit to at least two years of working for a relatively low salary, and you might even need to relocate to qualify.
Read our comprehensive guide to student loans to learn about how repaying student debt works and come up with a plan to get rid of your student debt fast.
Our answers to more questions about student loan forgiveness.
Are my student loans forgiven after 25 years?
It depends on the type of loan you have. With most federal loans, you can enroll in an income-driven repayment plan. Depending on your loan type and other factors, you might be eligible for forgiveness after 20 or 25 years of repayments.
Are student loans forgiven if you die?
Yes. You can have your student loan discharged if the borrower dies. Borrowers might be a parent or guardian, if you have a Parent PLUS loan.
To have it discharged, you must send a copy of the death certificate to your loan servicer.
How can I pay off my student loans faster?
Trying to get your debt forgiven isn’t always the fastest way to pay off your student loans. To get out of student debt faster, go for the shortest loan term you can afford, try to make extra repayments whenever you can toward your loan’s principal and — perhaps most important — get into the right mindset of eliminating your debt.
Does the Peace Corps offer its own student loan forgiveness program?
No, but you can count your time in the Peace Corps toward the public service requirement for Public Service Loan Forgiveness. You can learn more with our page on student loan forgiveness and the Peace Corps.
Does Teach for America offer student loan forgiveness?
While Teach for America doesn’t have its own student loan forgiveness program, you can qualify for forgiveness thanks to its partnership with AmeriCorps. You can learn more with our page on student loan forgiveness and Teach for America.
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