You don’t need federal loans to have your student debt forgiven — but it helps.
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.
Student loan forgiveness programs
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Do I qualify for a forgiveness program?
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.
1. Public Service Loan Forgiveness (PSLF)
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.
Eligible loans
Only student loans borrowed through the federal direct program can qualify:
- Direct Subsidized Loans
- Direct Unsubsidized Loans
- Direct Consolidation Loans
- Direct PLUS Loans
Borrower requirements
You must make 120 repayments while working full time at a public service job with a qualified employer, including:
- The federal, state, local or tribal government.
- Nonprofits registered as a tax-exempt 501(c)(3).
- Nonprofits registered as a 501(c)(3) without tax exemption but providing qualifying public services.
Qualifying public services
Nonprofits that aren’t tax-exempt are qualifying public services if they provide:
- Emergency management
- Public safety
- Public interest law services
- Military service
- Early childhood education
- Public education
- Public library services
- Other school-based services
- Law enforcement
- Public service for individuals with disabilities
- Public service for the elderly
- Public health
Problems with PSLF
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.
2. Teacher Loan Forgiveness
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.
Eligible loans
- Direct Subsidized Loans
- Direct Unsubsidized Loans
- Subsidized Federal Stafford Loans
- Unsubsidized Federal Stafford Loans
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.
Borrower requirements
To qualify for this forgiveness program, you must:
- Meet the requirements of a “highly qualified teacher.”
- Work full time for at least five consecutive years a low-income elementary school, secondary school or education service that serves low-income students.
- Teach at least one qualifying year after the 1997–1998 academic year.
- Have no outstanding Direct or Federal Family Education Loans taken on before October 1, 1998.
Am I a highly qualified teacher?
To meet the government’s requirements of a “highly qualified teacher,” you must show that you’ve:
- Attained a bachelor’s degree.
- Received full state teacher certification.
- Waived no certification or licensing requirements temporarily or provisionally.
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.
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3. Income-Based Repayment (IBR) Plan
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 long you’ll need to make repayments before your loan is forgiven.
- The percentage of your income you must pay each month.
- How the government calculates your income.
- The types of student loans that qualify for the plan.
How IBR works depends on when you took out your student loans:
- If you took out a loan after July 1, 2014. You typically pay 10% of your post-tax income but no more than the equivalent of what you’d pay with a 10-year Standard Repayment Plan. The government forgives all remaining debt after 20 years of repayment.
- If you took out a loan before July 1, 2014. You pay 15% of your post-tax income but no more than what you would have paid with a 10-year Standard Repayment Plan. The government forgives all remaining debt after 25 years of repayment.
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.
Eligible loans
- Direct Subsidized Loans
- Direct Unsubsidized Loans
- Subsidized Federal Stafford Loans
- Unsubsidized Federal Stafford Loans
- PLUS loans, not including Parent PLUS
- Direct Consolidation loans, not including Direct Parent PLUS loans
- Federal Consolidation Loans, not including FFEL Parent PLUS loans
Borrower requirements
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.
4. Pay As You Earn (PAYE) Repayment Plan
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.
Eligible loans
- Direct Subsidized Loans
- Direct Unsubsidized Loans
- Direct PLUS loans, not including Parent PLUS loans
- Direct Consolidation loans, not including Direct or FFEL Parent PLUS loans
Borrower requirements
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.
5. Revised Pay As You Earn (REPAYE) Repayment Plan
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:
- If you’re paying off debt from an undergraduate degree. You must make 20 years of repayments before the government forgives your debt.
- If you’re paying off debt from a graduate or professional degree. You must make 25 years of repayments before the government forgives your debt.
Eligible loans
- Direct Subsidized Loans
- Direct Unsubsidized Loans
- Direct PLUS loans, not including Parent PLUS loans
- Direct Consolidation loans, not including include Direct or FFEL Parent PLUS loans
Borrower requirements
Anyone with an eligible direct loan can qualify regardless of income.
6. Income-Contingent Repayment (ICR) Plan
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:
- 20% of your income after taxes.
- The amount you would’ve paid under a fixed 12-year standard repayment plan.
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.
Eligible loans
- Direct Subsidized Loans
- Direct Unsubsidized Loans
- Direct PLUS loans, not including Parent PLUS loans
- Direct Consolidation loans, including Parent PLUS loans
Borrower requirements
Anyone with an eligible student loan can qualify.
7. Federal Perkins Loan cancellation
Federal Perkins Loans were offered based on a student’s financial need, though the Department of Education recently phased them out. You may be able to cancel your loan canceled by choosing an eligible career path.
Teacher cancellation
You might qualify to have 100% of your Perkins Loan canceled if you teach full time at either a public or nonprofit elementary or secondary school for five consecutive years.
If you qualify for cancellation, you can typically qualify for deferment, which means you won’t have to make any repayments. To be eligible, you must either:
- Teach at a school serving low-income families.
- Teach special education.
- Teach a subject that has a shortage of qualified teachers in your state, such as science, math or foreign languages.
Your debt is canceled bit by bit at higher percentages over five academic years:
- First and second years. The government cancels 15% of your debt.
- Third and fourth years. The government cancels 20% of your debt.
- Fifth year. The government cancels 30% of your debt.
Other employment or volunteer cancellation
You may also be able to cancel all or part of your loan if you work in specific professions.
| Position | Percentage of loan forgiven | How long it takes |
|---|---|---|
| Nurse or medical technician | Up to 100% | 5 years of full-time employment |
| Firefighter | Up to 100% | 5 years of full-time employment (after August 14, 2008) |
| Provider of early intervention services for people with disabilities | Up to 100% | 5 years of full-time employment |
| Faculty member of a tribal college or university | Up to 100% | 5 years of full-time employment (after August 14, 2008) |
| Speech pathologist — requires master’s degree and work at a Title I school ) | Up to 100% | 5 years of full-time employment (after August 14, 2008) |
| Librarian — requires a master’s degree and work at a Title I school | Up to 100% | 5 years of full-time employment (after August 14, 2008) |
| Law enforcement or corrections officer | Up to 100% | 5 years of full-time employment |
| Attorney working for a federal public or community defender organization | Up to 100% | 5 years of full-time employment (after August 14, 2008) |
| Public or nonprofit child service agency provider | Up to 100% | 5 years of full-time employment |
| Staff member of the Head Start program | Up to 100%
| 7 years of full-time employment |
| Pre-K staff | Up to 100%
| 7 years of full-time employment (after August 14, 2008) |
| Military service member | Up to 100% | 5 years of eligible service (after August 14, 2008) |
| AmeriCorps, Peace Corps or VISTA volunteer | Up to 70%
| 4 years of eligible volunteer work |
Perkins Loan discharge
Along with other reasons for discharging your student loans, you can also discharge your Perkins Loans if:
- You’re a veteran with a service-related disability.
- Your spouse died in the 9/11 attacks.
8. Loan repayment assistance for teachers
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.
9. Loan repayment assistance for lawyers
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.
John R. Justice Student Loan Repayment Program
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.
Eligible loans
- All Direct Loans, not including Parent PLUS
- All FFEL Loans
Borrower requirements
- Must be a state or federal public defender or a state prosecutor.
- Must agree to stay in an eligible position for at least three years.
Department of Justice Attorney Student Loan repayment program
You could get up to $60,000 in repayment assistance if you work for the Department of Justice for at least three years.
Eligible loans
- All Direct Loans
- All Stafford Loans
- All Supplemental Loans
- All PLUS loans, not including Parent PLUS loans
- Federal Perkins Loans
- Federal Consolidation Loans
- The Health Profession Student Loan Program
- The Nursing Student Loan Program
- The Health Education Assistance Loan Program
- Defense loans (before July 1, 1972)
- National Direct Student loans (between July 1, 1972, and July 1, 1987)
Borrower requirements
- Must be a full-time attorney for the Department of Justice.
- You must have at least $10,000 in federal student loans.
Herbert S. Garten Loan Repayment Assistance Program
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.
Eligible loans
- All Federal Stafford Loans
- Supplemental Loans for Students
- Federal Perkins Loans
- Law Access Loans
- Law Student Loans
- Private student loans used to pay for law school
- Private student loans used to prepare or take bar exam
Borrower requirements
- You must work at an LSC-funded organization.
- You must have total outstanding debt of $75,000 or more.
10. Loan repayment assistance for nurses
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.
NURSE Corps Loan Repayment Program
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.
State LRAPs for nurses
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.
11. Loan repayment assistance for healthcare professionals
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.
Students to Service (S2S) Program
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.
Eligible loans
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.
Borrower requirements
- You must be a full-time student at a medical or dental school.
- You must be in your last year of studies.
- You must a fully accredited degree program.
- You plan on completing an accredited primary medical residency.
Students to Service gives priority to borrowers who come from a disadvantaged background or are likely to continue working in disadvantaged areas.
National Health Service Corps (NHSC) loan repayment assistance
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.
Eligible loans
Helps with all student loans, except those used to pay for residency-related expenses.
Borrower requirements
You must be a primary care doctor, dentist or mental healthcare provider and commit to two years of work at an NHSC site.
Indian Health Services (IHS) Loan Repayment Program
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.
Eligible loans
Accepts any student loan used to pay for your medical-related degree.
Borrower requirements
- You must be a US citizen.
- You must have earned a healthcare-related degree or be in your last year of training.
- You must have earned a medical license, unless you’re in your last year of training.
- You must commit to practicing at an Indian health facility.
- You can start working by September 30 of this year and continue for two years of full-time work.
National Institutes of Health (NIH) loan repayment programs
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.
State LRAP programs for healthcare professionals
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.
12. Military student loan repayment assistance
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.
Loan forgiveness for doctors in the armed forces
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.
13. Student loan discharge
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:
- Discharge for bankruptcy. Not all student debt can be discharged if you file for bankruptcy. However, if you can prove that making your repayments causes “undue hardship,” then you might not have to pay off your student debt.
- Discharge for school closure. If your school closes within 120 days of your enrollment, the government discharges student debt used to pay for attending that institution.
- Discharge for false certification or unauthorized payment. If you’re a victim of identity theft, you can have your student loans discharged if someone other than you took out a student loan in your name — and you can prove it.
- Discharge for permanent disability. If you become permanently disabled in a way that makes it impossible for you to work, you could be eligible to wipe your student debt clean.
- Borrower defense discharge. If you can prove that your school misled you into taking out federal loans, you can apply for a borrower defense discharge.
- Unpaid refund discharge. If your school was supposed to pay a refund to the Department of Education or another lender over a Direct or FFEL Loan, you might be able to discharge portion of debt that was supposed to be refunded.
- Discharge due to death. If the borrower on a student loan dies — your parent, in the case of a Parent PLUS loan — then you can likely have that loan discharged by sending a copy of the death certificate to your loan servicer.
Student loan forgiveness and taxes
Student loan forgiveness isn’t exactly free. In fact, if you’re not careful, it could even cost you more now than continuing to pay off your student debt. That’s because the IRS usually considers forgiven debt taxable income. In that case, you’ll typically have to pay a percentage of your loan balance before you’re finally free from your student debt.
However, federal student loan reform is beginning to change this. The Tax Cuts and Jobs Act of 2017 now exempts borrowers who qualified for forgiveness due to permanent disability and death from having to pay income tax on the forgiven portion of their federal student loans. Learn more with our guide to federal student loan legislation.
Explore student loan forgiveness programs in your state
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Bottom line
Student loan forgiveness is not just for people with federal loans — though if you do, you’ll likely have more options. Forgiveness programs are most often incentive programs 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.
