Student Loan Forgiveness is a procedure of canceling or discharging student loan, usually when you meet specific criteria. With exception of bankruptcy or debt settlement, at which most or all forms of debt can be discharged, student loan forgiveness doesn’t negatively affect your credit, because it can be the best way of helping you pay back. Here is all you need to know.
Differences Between Forgiveness, Discharge and Cancellation
The terms forgiveness, discharge and cancelation entail the same thing, although they are applied in various ways. If you are no longer needed to make payments on your loans because of your work, this is commonly referred to as forgiveness or cancellation. If you are no longer needed to make payments on your loans because of other situations, like a permanent and total disability or the suspension of the school where you received your loans, this is typically referred to as discharge.
How Do Student Loan Forgiveness Programs Operate?
There are several specific sorts of student loan forgiveness programs. Student loan borrowers can take full advantage of, and they always apply to federal student loans. Almost every program can have its specific set of standards and the percentage of forgiveness that it provides. After all, there are really particular qualifications that you must meet in order to be eligible for loan forgiveness or to seek support with repayment. Loan forgiveness ensures that you don’t have to pay back any and all of your loan. You never know exactly what you might be eligible for, so take a closer look at the possibilities below.
1. Teacher Loan Forgiveness
You may be eligible for forgiveness of up to a total cost of $17,500 on eligible federal student loans if you teach full-time for five complete and consecutive academic years in specific educational service agencies. These agencies should support low-income families, and satisfy other qualifications.
2. Public Service Loan Forgiveness (PSLF)
You will qualify for forgiveness of the whole remaining balance of your Direct Loans, if you work full time for a not-for-profit organization or a government. This will be possible after you have made 120 qualifying payments, that is, 10 years of payments. You can repay your federal student loans under an income-driven repayment plan in order to benefit from PSLF.
3. Income-Driven Repayment (IDR) Plan
When you repay your loans on a repayment plan based on your financial situation, any remaining balance on your student loans will be forgiven. But this is possible if you make a certain amount of payments for a certain duration of time.
4. AmeriCorps
The Segal AmeriCorps Education Award is received by participants. These participants must complete national service in the AmeriCorps approved program. The program includes AmeriCorps NCCC, AmeriCorps VISTA, or AmeriCorps State and National. Once you have fully achieved your service, you are eligible to receive the Segal AmeriCorps Education Award. It can be used to repay eligible student loans.
5. Closed School Discharge
You may be eligible for discharge of your federal student loan if your school closes while you’re enrolled. Loan discharge is the withdrawal of your responsibility to repay the loan under specific situations. In order to apply for a closed school loan discharge, some eligibility conditions exist. To receive a discharge, you must apply. If your school closes, it is essential for you to obtain your financial or academic support documents. If you want student loans discharged or intend to attend another school, you will need those documents.
6. Perkins Loan Cancellation
It is accessible only for Federal Perkins Loans. You may be qualified to cancel or discharge all or a portion of your Perkins Loan. It is based on your employment or volunteer service.
7. Total and Permanent Disability Discharge
This is available for FFEL Program loans, Direct Loans, and Perkins Loans.
You can qualify for a discharge of your federal student loans or Teacher Education Assistance for College and Higher Education (TEACH) if you are permanently and completely disabled.
8. Borrower Defense to Repayment
This is available for Direct Loans.
If you take out the loans to attend a school, you might be qualified for forgiveness of the federal student loans based on borrower defense to repayment. Depending on when you received your loan, the particular requirements for qualifying for a borrower defense to repayment discharge differ.
9. Unpaid Refund Discharge
This program is available for FFEL Program loans and Direct Loans.
You may be eligible for a discharge of the portion of your federal student loan(s) that the school failed to return if you withdrew from school and the school failed to make a necessary return of loan funds to the loan servicer.
How to Apply For Forgiveness
If you think you qualify, please contact your loan servicer. If you have a Perkins Loan, you should call the school that has made the loan or the loan service that has been designated by the school.
Great Lakes and Student Loan Forgiveness
Great Lakes is a student loan service provider. It owns thousands of federally guaranteed loans across the United States. The organization operates with more than 1,000 lenders and 6,000 schools to assist students attend school. Great Lakes does not provide student loans. It serves as a loan servicer or guarantor to countless number of lenders across the nation. Great Lakes manages a wide range of student loan based services, including federal consolidations, repayment plans, and student loan forgiveness programs. As a result of its collaboration with the Department of Education, a number of loan forgiveness programs are available to qualified borrowers. If you’re looking to explore your Great Lakes Student Loan Forgiveness Options, you can contact local agencies for help such as SLR.
Public Service Loan Forgiveness (PSLF) and Great Lakes
You might qualify for Public Service Loan Forgiveness with Great Lakes as a full-time public employee in Peace Corps and AmeriCorps. You will need to have loans that are eligible for Public Service Loan Forgiveness. Your student loans may become eligible for forgiveness, after you have met the criteria.
Total and Permanent Disability (TPD) Discharge Great Lakes
You may be eligible for a Total and Permanent Disability (TPD) Discharge, if you are an indefinitely disabled veteran or an individual with student loans. Once you are approved, all eligible loans will be transferred to the sole service provider of the DOE. It is called Nelnet and is the unique service provider of the TPD Discharge program.
Teacher Loan Forgiveness and Great Lakes
You might qualify for Teacher Loan Forgiveness through Great Lakes, if you work full-time in a poor school. Based on your qualifications, Teacher Loan Forgiveness provides up to $17,500 in loan repayment aid for eligible loans.
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