Student Loan Forgiveness Programs – Things You Should Know
The Government Student Loan Forgiveness is something you should learn by yourself and become an expert in it so as to have its benefits. Here are tips to do that.
Types of Student Loans
Each federal student loan forgiveness program has different eligibility criteria and may be available only to certain types of federal student loans. Hence it’s necessary to know the loan types.
Direct Loans
These are loans obtained through the William D. Ford Federal Direct Loan Program and are commonly known as Stafford loans or direct Stafford loans. Direct PLUS loans issued to graduate or professional students and students’ parents also come under the program. If the federal loans are consolidated with the Direct Consolidation Loan Program, the new loan too becomes a part of this program.
Federal Perkins Loans
These may be offered to graduate, undergraduate and professional students having a serious financial need.
Federal Family Education Loans
These are not available to new borrowers since 2010. They include subsidized and unsubsidized Stafford loans, PLUS loans and FFEL Consolidation loans.
You may have more than one type of federal loans such as Perkins loan and many direct loans and each of them could qualify for a different forgiveness program.
If you are not sure about which loan types you have, you can log into My Federal Student Aid and review the loans’ names as suggested by the U.S. Department of Education. Typically if the loan has “direct” in the title, it’s a part of the William D. Ford Federal Direct Loan Program. In case of any questions, you can also contact your federal loan servicer.
Private student loans don’t qualify for federal forgiveness or cancellation programs; but you may get other options like state-specific loan repayment programs or programs made available by employers or professional industries.
Student Loan Forgiveness Programs
Federal Public Service Loan Forgiveness
Direct loans qualify under this program. Also FFEL, PSLF or Perkins loans qualify once they’ve been consolidated into a direct loan through the Direct Consolidation Loan Program.
Federal Income-driven Repayment Plans
Direct loans taken by students qualify for all four income-drive repayment plans. FFEL, parent loans and Perkins loans may qualify after they are consolidated into a Direct Consolidation Loan.
Federal Perkins Loan Cancellation
Perkins loans qualify for this program.
Federal Teacher Loan Forgiveness
FFEL and direct loans qualify, but PLUS loans don’t. If you’ve a FFEL consolidation loan or Direct Consolidation Loan, only a part that repaid an eligible loan can get forgiveness.
You’ll need to do some research and find how and for what type of loans you can benefit from forgiveness. Do that and enjoy the freedom from the burden of your students’ loan.
