Student Loan Forgiveness, Discharge, Cancellation

Loan Forgiveness is Possible!

STUDENT LOAN FORGIVENESS

Loan forgiveness is possible!

 

  • Income-Driven Repayment Plans: 20-25 year forgiveness.
  • Teacher Loan Forgiveness and Perkins Loan Cancellation Programs: 1-5 year forgiveness.
  • Public Service Loan Forgiveness: 10-year forgiveness.
  • Total Permanent Disability Discharge: Immediate discharge.
  • Military College Loan Repayment Program (CLRP): 4-6 year forgiveness.

 

Find out if you qualify: (877) 554-6846

 

There are many loan forgiveness programs.  

Unified Document Services can you find which program best suits your needs!

 

Below is are charts provided by the U.S. Department of Education of the different options available.

Discharge Condition Amount Discharged Notes
Borrower's total and permanent disability or death 100 percent If you are a parent PLUS loanborrower, then the loan may be discharged if you die, or if the student on whose behalf you obtained the loan dies.
Bankruptcy (in rare cases) 100 percent Cancellation is possible only if the bankruptcy court rules that repayment poses an undue hardship to the borrower.
Closed school (for borrowers who could not complete their program because the school closed while they were enrolled or borrowers who withdrew not more than 120 days before the school closed) 100 percent For loans received on or after Jan. 1, 1986.
False loan certification (school falsely certified a borrower's eligibility to receive a loan) 100 percent For loans received on or after Jan. 1, 1986.
False certification by reason of identity theft (loan was made as a result of the crime of identity theft, as determined by a court) 100 percent Effective July 1, 2006.
School does not make required return of loan funds to the lender Up to the amount that the school was required to return. For loans received on or after Jan. 1, 1986.
Full-time teacher for five consecutive years in a designated elementary or secondary school or educational service agencyserving students from low-income families. Must meet additional eligibility requirements. Up to $5,000 (up to $17,500 for elementary/secondary special education teachers and secondary math and science teachers) of the total loan amount outstanding after completion of the fifth year of teaching.

Under the Direct and FFEL Consolidation Loan programs, only the portion of the consolidation loan used to repay eligible Direct Loans or FFEL Program loans qualifies for loan forgiveness.

  • For Direct Subsidized and Unsubsidized Loan and Subsidized and Unsubsidized Federal Stafford Loan borrowers with no outstanding balance on a Direct Loan or FFEL Program loan on Oct. 1, 1998, or who have no outstanding balance on a Direct Loan or FFEL Program loan on the date they received a loan after Oct. 1, 1998.
  • PLUS loans are not eligible.
  • To learn more about the eligibility requirements for teacher loan forgiveness and to find out whether your school or educational service agency where you teach is considered to serve low-income students, go to Teacher Loan Forgiveness.
Loan forgiveness for public service employees

(Direct Loan Program only)

100 percent of the remaining outstanding balance on an eligible Direct Loan. For a borrower who is not in defaultand who makes 120 monthly payments on the loan after Oct. 1, 2007, under certain repayment plans, while the borrower is employed full-time in a public service job.

You may not apply for forgiveness until after you have made all of the required 120 qualifying monthly payments.

 

LOWER YOUR MONTHLY PAYMENTS

Student Loan Repayment Assistance

Loan forgiveness is often the goal for student loan borrowers and while many may qualify immediately, others may have to wait a certain time frame. If you are struggling to make your student loan payments, you may be eligible to significantly lower your payments while working toward future student loan forgiveness.

Income-Driven Repayment Plans (such as IBR, PAYE, and REPAYE), for instance, can cap your monthly loan payments at 10-15% of your discretionary income before meeting the time frame for loan forgiveness qualification.

There are many loan repayment programs. Below is a chart provided by the U.S. Department of Education covering the different options available.

Repay Your Direct Loans and Federal Family Education Loan (FFEL) Program Loans

 

Overview of Direct Loan and FFEL Program Repayment Plans
Repayment Plan Eligible Loans Monthly Payment and Time Frame Eligibility and Other Information
Standard Repayment Plan
  • Direct Subsidized and Unsubsidized Loans
  • Subsidized and Unsubsidized Federal Stafford Loans
  • all PLUS loans
  • all ConsolidationLoans (Direct or FFEL)
Payments are a fixed amount that ensures your loans are paid off within 10 years (within 10 to 30 years for Consolidation Loans). All borrowers are eligible for this plan.

You’ll usually pay less over time than under other plans.

Standard Repayment Plan with a 10-year repayment period is not a good option for those seeking Public Service Loan Forgiveness (PSLF).

Standard Repayment Plan for Consolidation Loans is not a qualifying repayment plan for PSLF.

Graduated Repayment Plan
  • Direct Subsidized and Unsubsidized Loans
  • Subsidized and Unsubsidized Federal Stafford Loans
  • all PLUS loans
  • all Consolidation Loans (Direct or FFEL)
Payments are lower at first and then increase, usually every two years, and are for an amount that will ensure your loans are paid off within 10 years (within 10 to 30 years for Consolidation Loans). All borrowers are eligible for this plan.

You’ll pay more over time than under the 10-year Standard Plan.

Generally not a qualifying repayment plan for PSLF.

Extended Repayment Plan
  • Direct Subsidized and Unsubsidized Loans
  • Subsidized and Unsubsidized Federal Stafford Loans
  • all PLUS loans
  • all Consolidation Loans (Direct or FFEL)
Payments may be fixed or graduated, and will ensure that your loans are paid off within 25 years.
  • If you're a Direct Loan borrower, you must have more than $30,000 in outstanding Direct Loans.
  • If you're a FFEL borrower, you must have more than $30,000 in outstanding FFEL Program loans.
  • Your monthly payments will be lower than under the 10-year Standard Plan or the Graduated Repayment Plan.
  • You’ll pay more over time than under the 10-year Standard Plan.
  • Not a qualifying repayment plan for PSLF.
Revised Pay As You Earn Repayment  Plan (REPAYE)
  • Direct Subsidized and Unsubsidized Loans
  • Direct PLUS loans made to students
  • Direct Consolidation Loans that do not include PLUS loans (Direct or FFEL) made to parents
  • Your monthly payments will be 10 percent of discretionary income.
  • Payments are recalculated each year and are based on your updated income and family size.
  • You must update your income and family size each year, even if they haven’t changed.
  • If you're married, both your and your spouse’s income or loan debt will be considered, whether taxes are filed jointly or separately (with limited exceptions).
  • Any outstanding balance on your loan will be forgiven if you haven't repaid your loan in full after 20 years (if all loans were taken out for undergraduate study) or 25 years (if any loans were taken out for graduate or professional study).
  • Any Direct Loan borrower with an eligible loan type may choose this plan.
  • You’ll usually pay more over time than under the 10-year Standard Plan.
  • You may have to pay income tax on any amount that is forgiven.
  • Good option for those seeking PSLF.
Pay As You Earn Repayment Plan (PAYE)
  • Direct Subsidized and Unsubsidized Loans
  • Direct PLUS loans made to students
  • Direct Consolidation Loans that do not include (Direct or FFEL) PLUS loans made to parents
  • Your monthly payments will be 10 percent of discretionary income, but never more than you would have paid under the 10-year Standard Repayment Plan.
  • Payments are recalculated each year and are based on your updated income and family size.
  • You must update your income and family size each year, even if they haven’t changed.
  • If you're married, your spouse's income or loan debt will be considered only if you file a joint tax return.
  • Any outstanding balance on your loan will be forgiven if you haven't repaid your loan in full after 20 years.
  • You must be a new borrower on or after Oct. 1, 2007, and must have received a disbursementof a Direct Loan on or after Oct. 1, 2011.
  • You must have a high debt relative to your income.
  • Your monthly payment will never be more than the 10-year Standard Plan amount.
  • You’ll usually pay more over time than under the 10-year Standard Plan.
  • You may have to pay income tax on any amount that is forgiven.
  • Good option for those seeking PSLF.
Income-Based Repayment Plan (IBR)
  • Direct Subsidized and Unsubsidized Loans
  • Subsidized and Unsubsidized Federal Stafford Loans
  • all PLUS loans made to students
  • Consolidation Loans  (Direct or FFEL) that do not include  Direct or FFEL PLUS loans made to parents
  • Your monthly payments will be either 10 or 15 percent of discretionary income (depending on when you received your first loans), but never more than you would have paid under the 10-year Standard Repayment Plan.
  • Payments are recalculated each year and are based on your updated income and family size.
  • You must update your income and family size each year, even if they haven’t changed.
  • If you're married, your spouse's income or loan debt will be considered only if you file a joint tax return.
  • Any outstanding balance on your loan will be forgiven if you haven't repaid your loan in full after 20 years or 25 years, depending on when you received your first loans.
  • You may have to pay income tax on any amount that is forgiven.
  • You must have a high debt relative to your income.
  • Your monthly payment will never be more than the 10-year Standard Plan amount.
  • You’ll usually pay more over time than under the 10-year Standard Plan.
  • You may have to pay income tax on any amount that is forgiven.
  • Good option for those seeking PSLF.
Income-Contingent Repayment Plan (ICR)
  • Direct Subsidized and Unsubsidized Loans
  • Direct PLUS Loans made to students
  • Direct Consolidation Loans
  • Your monthly payment will be the lesser of
    • 20 percent of discretionary income, or
    • the amount you would pay on a repayment plan with a fixed payment over 12 years, adjusted according to your income.
  • Payments are recalculated each year and are based on your updated income, family size, and the total amount of your Direct Loans.
  • You must update your income and family size each year, even if they haven’t changed.
  • If you're married, your spouse's income or loan debt will be considered only if you file a joint tax return or you choose to repay your Direct Loans jointly with your spouse.
  • Any outstanding balance will be forgiven if you haven't repaid your loan in full after 25 years.
  • Any Direct Loan borrower with an eligible loan type may choose this plan.
  • You’ll usually pay more over time than under the 10-year Standard Plan.
  • You may have to pay income tax on any amount that is forgiven.
  • Good option for those seeking PSLF.
  • Parent borrowers can access this plan by consolidating their Parent PLUS Loans into a Direct Consolidation Loan.
Income-Sensitive Repayment Plan
  • Subsidized and Unsubsidized Federal Stafford Loans
  • FFEL PLUS Loans
  • FFEL Consolidation Loans
Your monthly payment is based on annual income, but your loan will be paid in full within 15 years.
  • You’ll pay more over time than under the 10-year Standard Plan.
  • The formula for determining the monthly payment amount can vary from lender to lender.
  • Available only for FFEL Program loans, which are not eligible for PSLF.