HOW IT WORKS
Certain career choices – teachers, nurses, employees at any branch of local, state or federal government – make you eligible for loan forgiveness or discharge of Direct and Perkins federal loans. Find out if your job or personal situation qualifies and how to apply to have your loan forgiven or discharged.
Is student loan forgiveness real?
Yes, student loan forgiveness is real, but it won’t happen overnight. There is no magic wand that will make your entire student loan debt disappear instantly. You can, however, enroll in certain repayment plans that will lower your monthly payments and allow you to forgive any remaining balance after 10 or 15 years (depending on the plan you choose). You may also qualify for various student loan forgiveness programs that can eliminate a portion of your debt in as little as five years.
FEDERAL STUDENT LOAN REPAYMENT PLANS
TYPES OF STUDENT LOAN FORGIVENESS PROGRAMS
Most borrowers are unaware of the numerous federal student loan forgiveness programs available. Depending on your specific situation, you may qualify for one or more of the following programs.
The Public Service Loan Forgiveness program (PSLF) offers complete loan forgiveness to those who work in the public sector. This includes non-profit employees, Peace Corps volunteers, public school teachers and staff, and government employees to name a few.
The Teacher Loan Forgiveness program (TLF) is a form of student loan forgiveness that is separate from the Direct Loan or Obama Student Loan Forgiveness program. This program awards educators with a principal reduction of their federal loans. It was designed to encourage students to enter the education field and to incentivize teachers to continue teaching.
Total and Permanent Disability Discharge program (TPD) helps borrowers suffering from a disability by offering a complete discharge on their federal loans.
Unfortunately, most private lenders do not offer disability discharge for private student loans. The few that do are Sallie Mae, Wells Fargo, Discover, and New York Higher Education Services Corp.
In the Direct Loan program, interest in the IBR does not capitalize on the subsidizedportion of your direct loan. This applies only for the first three years of your IBR payment, and only if your IBR payment is less than what is normally due to interest.
This can amount to many thousands of dollars depending on your loan balance and what type of payment you currently qualify for.
There is also interest forgiveness in the PAYE and REPAYE plans as well.
If you enroll into any of the income-driven repayment plans, your loan balance would be forgiven at the end of the term if you still have a remaining balance.
The term of the loan would be between 20-25 years depending on which repayment plan you choose, and when your loans were originally borrowed.
How much you will be forgiven will depend on your original loan amount, how much you are earning, and how much your earnings fluctuate during your repayment term.
Nurses have access to a number of county, state, and federal student debt forgiveness programs. If you currently work for a hospital or clinic, your employer may even offer assistance with repaying your nursing school loans.
The two main federal programs are the Nurse Corps Loan Repayment Program and the National Health Service Corps (NHSC) Loan Repayment Program.
Colleges and universities do not commonly close, but it does happen. Luckily, in those situations, borrowers are protected thanks to the closed school discharge.
You will no longer have to make payments on eligible federal student loans and any payments you already made will be refunded. If you were in default on any of these loans, the loan holder will also repair your damaged credit history.
To incentivize qualified individuals to join the military or the reserves, many U.S. military branches offer student loan forgiveness programs.
Qualifying borrowers can receive up to $65,000 in loan forgiveness over the length of their service contract.
For active duty members, the military pays the greatest of 33.33% of your remaining principal balance annually or $1,500 for each service year. For reserves, the Army and Navy repay 15% or $1,500 per year, whichever is greater. The Air National Guard repays the greatest of 15% or $5,000 per year.
CLRP benefits are taxable, but 28% of the forgiveness payments are sent directly to the IRS. This means you will not owe any taxes out of pocket related to your CLRP benefits.
Through the Department of Education, several colleges offer low-interest Perkins Loans to financially needy students. If you received a Federal Perkins Loan, you might qualify for partial or full loan forgiveness.
This student loan forgiveness program cancels a percentage of a borrower’s Federal Perkins Loan if they work full-time in an eligible field. You will have a portion of your loans forgiven for each year of service. The specific cancellation terms depend on your line of work, but this program awards up to 100% forgiveness. For the majority of Perkins Loan cancellations, the cancellation terms are as follows:
Three Steps to Forgiveness
We’ll get to know you and the specifics of your case, including your lenders and current financial obligations.
Review & Analysis
Next, we’ll gather information on loan status, balances and payment history, so we can find the best solution for you.
Finally, our loan advisors will make recommendations to help you quality for forgiveness and get out of student loan debt.
P L A T I N U M S T A T I S T I C S
About Platinum Debt Services
Platinum Debt Services is a national financial services company based in Costa Mesa, California that helps people and businesses overcome their student loan, tax, business, and credit obstacles. Rated A+ by the Better Business Bureau and in business since 2007, our financial and tax professionals transform lives through customized, smart money solutions.
If you have student loan debt, we can help. You may be eligible for student loan forgiveness or other repayment options that can lower your monthly payments and keep you from defaulting on your loans. Together, we’ll solve your student loan problems and put you on the path to better financial health.