Popular ways of student loan forgiveness, cancellation or dischargePosted on August 16, 2017 by Michael Hoverson
If you’ve run into financial difficulty and your student loans are creating a hardship that may be impossible to recover from, there are ways you can mitigate your loans. Here are some popular ways to have your loan forgiven, canceled or discharged:
Public Service Loan Forgiveness. You can have your remaining federal student loan forgiven if you work for the government or a nonprofit for at least 10 years. This includes job classes such as firefighters, teachers, nurses and military personnel, among others. Only federal direct loans are eligible, but you can consolidate your other student loans so that they can be forgiven under the terms of this program. Be aware that 10 years is a long commitment for someone recently out of college, but this can really make a difference in the long run.
Teacher Loan Forgiveness. If you are a teacher who works full time for five consecutive years, then you can have up to $17,500 in direct Stafford loans forgiven. Be aware that only teachers who work in low-income public schools and who took out loans after October of 1998 will qualify.
Perkins Loan Cancellation. You can have up to 100% of your federal Perkins loans canceled if you work in public service jobs. This program eligibility kicks in after five years of service. It applies to firefighters, police officers, teachers, school librarians, nurses and other similar occupations. In most cases, your loans will be discharged incrementally for each year that you are in public service.
Income Driven Repayment. The federal government offers four main income-driven student loan repayment programs that allow you to pay a percentage of your monthly income toward your loans. These repayment programs were designed for former students who have large loan balances relative to their incomes, and all student loans are automatically forgiven after either 20 or 25 years.
Hoverson Law Offices serve clients in Minneapolis, Bloomington and other nearby Minnesota communities.