Student Loan Forgiveness Progams
President Biden's Loan Forgiveness Plan Killed By US Supreme Court
You have probably heard about President Biden's student loan forgiveness program that was announced in October 2022. The Supreme Court nixed that program at the end of June 2023.
President Biden has announced that the pause in student loan payments that began in the Covid pandemic will end, and the first payments will come due in October 2023.
For details about the 2022 student loan forgiveness program under the Biden administration, see this article.
So, with Biden's forgiveness plan eliminated, borrowers are left with the existing loan reduction programs offered by the Department of Education.
Loan Forgiveness Programs That Still Exist, Other Than the Biden Plan Rejected By the Supreme Court
The remainder of this article covers other types of student loan forgiveness programs that were in existence before the general forgiveness program that President Biden announced in October 2022.
Student loan forgiveness programs can bring great relief to borrowers who qualify, and now many people may qualify for them and not even realize it!
If you DO qualify, they are a magic bullet. But to qualify you muyst work hard for them, serving your community for 10 years or more, and making regular payments for 10 years, after which your entire remaining balance on the loans is erased!
The program was launched in 2007, and the right kind of qualifying loans didn't become common until 2009, so it's only recently, as of 2019 and 2020 that people just now are eligible to qualify for getting their remaining payment wiped out.
Folks who benefit from forgiveness programs usually work for low pay in jobs that help others -- for example, teachers, public defenders, or health care professionals working with populations in need.
If you have worked in a government or non-profit job for 10 years and have been making IDR payments on your direct student loan for 120 payments, you may qualify to have the remaining payments eliminated.
The best known and most widely used student loan forgiveness program is the federal government's public service program. The goal of the program is to encourage graduates to work full-time in public service jobs.
Under the program, the government will forgive a borrower's
- Direct Federal Loans,
- after they have made 120 regular IDR payments -- that's ten years' worth --
- while working full time for a federal, state, or local government agency or for a nonprofit organization.
Despite what you may have heard, Pubic Service Loan Forgiveness is NOT Dead!
You may have heard, a while ago that 99% of PSLF applications were denied. True! BUT, according to the The Student Loan Lawyer, Joshua Cohen, those applications were rightly denied, because they lacked one of the three essential elements required for Public Service Loan Forgiveness.
more...
