If you’re like most people with student loan debt, student loan forgiveness programs sound like a dream. These programs offer the possibility of having some or all of your federal student loans completely forgiven. In other words, you won’t have to pay them back! 

Pretty exciting, right? Absolutely! 

BUT, unfortunately, many people find applying for these programs to be a bit tricky and overly confusing. That’s why we’ve decided to give you all the facts and information you need about student loan forgiveness programs in this blog post! 

Here’s what we’ll cover: 

  • What to know about Joe Biden’s October 2021 update to the Public Service Loan Forgiveness Program
  • What to do if you qualify for the Public Service Loan Forgiveness program
  • Who qualifies for other student loan forgiveness programs
  • 3 ways to manage or reduce your student loan debt without loan forgiveness programs

But before we get into those topics, let’s quickly go over some quick facts.

Quick Facts About Student Loan Forgiveness Programs

Student loan forgiveness:

  • typically refers to the forgiveness of federal student loans. If you’ve taken out private student loans, it’s harder to qualify for student loan forgiveness, though some companies and organizations do offer it;
  • is subject to tight parameters and restrictions. For instance, you usually have to work in a specific profession for a certain number of years before becoming eligible;
  • is different from student loan discharge, which is the elimination of student loan debt on account of very extenuating circumstances such as death, bankruptcy, or school closure. You may also be eligible for a total and permanent disability discharge (TPD) if you have a permanent disability; 
  • differs from deferment and forbearance, which are other ways of pausing and postponing your payments on account of certain life circumstances

What to Know About Joe Biden’s October 2021 Update to Student Loan Forgiveness Programs 

Have you heard of the Public Service Loan Forgiveness (PSLF) program? For a long time, this program was seen as a complete failure. Even if you were eligible, it was likely that, for one reason or another, the Department of Education would reject your application. 

The Biden administration has recently decided to change that. On October 6, 2021, the administration made changes to the PSLF program, making it easier for people to apply and get their applications for loan forgiveness approved. 

So far, the changes to the program have led to the elimination of $1.7 billion of debt for 22,000 borrowers. And the administration has estimated that an additional 27,000 borrowers could have around $2.8 billion of debt eliminated if they can prove they’re eligible. 

Who’s Eligible for the Public Service Loan Forgiveness Program?  

You’re eligible for this program if you:

  • Have been or were previously employed full-time in a public sector job for a qualifying employer at least 10 years
  • Have student debt from Direct Loans (or consolidate your loans into a Direct Loan)
  • Have made 120 qualifying payments 

Normally, you’d also need to have made all of your qualifying payments under an income-driven repayment plan. But, in an effort to restore the program, the Biden administration has waived this requirement until October 2022.

The definition of a public sector job isn’t 100% clear, but it typically applies to professions in the following fields:

  • Public Education 
  • Public Safety (e.g. law enforcement, firefighting, disaster response, etc.)
  • Non-Profits (e.g. Americorps, Peace Corps, Teach for America)
  • Government (federal, state, local, and tribal)
  • Military

But, according to the Office of Federal Student Aid, what matters most is that your current or past employer falls under one of two categories: 

  • Government organizations at any level (U.S. federal, state, local, or tribal) – this includes the U.S. military
  • Not-for-profit organizations that are tax-exempt under Section 501(c)(3) of the Internal Revenue Code

What to Do If You Qualify for the Public Service Loan Forgiveness Program

If you qualify for the Public Service Loan Forgiveness program, we recommend applying ASAP. After October 2022, the requirements for eligible borrowers will likely become stricter. 

To apply, go to the Department of Education Office of Federal Student Aid website and submit a PSLF form to your loan provider.

Who Qualifies for Other Student Loan Forgiveness Programs

The Public Service Loan Forgiveness program isn’t your only option. You may also qualify to get some of your debt forgiven if…

You’re a public school teacher

The Teacher Loan Forgiveness Program forgives up to $17,500 of your (unsubsidized and subsidized) federal student loans. To be eligible, you must teach for 5 consecutive years at a low-income public school or work 5 consecutive years at an educational service agency. You must also be considered a highly qualified teacher.  

What’s great is that public school teachers are eligible for the Teacher Loan Forgiveness Program and the Public Service Loan Forgiveness Program, so feel free to apply for both programs if you meet the criteria! 

Here are some other key eligibility requirements for teachers looking to apply for the Teacher Loan Forgiveness program:

  • Of your 5 consecutive, full-time years of teaching, only one year may be prior to the 1997-1998 academic school year.
  • You must have been employed at a low-income elementary school, secondary school, or educational service agency.
  • The loans in consideration for forgiveness must have been taken out before the end of your 5 consecutive years of teaching. 

Also, please note that under certain circumstances, you may be eligible for the Teacher Loan Forgiveness program even if you have only completed 4 consecutive, full-time years of teaching. In this case, the 5th, partial year of teaching may be considered eligible if:

  • Your completed at least half of the academic year of teaching, AND
  • Your employer confirms that you have fulfilled your contractual obligations for the year, AND
  • You were unable to complete the year for one of several approved reasons including: returning to post-secondary education, possessing a condition included in the Family and Medical Leave Act of 1993, or serving active service duty.

You’re a Nurse or Doctor

Like teachers, these professions are included in the PSLF program, but also have their own forgiveness programs as well. Here’s a complete list of student loan forgiveness programs and options.

Student Loan Forgiveness for Nurses

This is a highly comprehensive overview of student loan forgiveness options for nurses by each state. But the Nurse Corps Student Loan Repayment Program (LRP) is the most popular, and has the following eligibility requirements:

  • You must be a registered nurse or an advanced practice registered nurse.
  • You must work in a critical shortage facility or an accredited school of nursing.
  • Your loans must have been directly applied to cover the cost of nursing school or living expenses during nursing school.
  • You may have any of the following loans to apply: Stafford, Grad PLUS, Consolidation loans, Perkins, or other private loans 

Here is a complete guide to the Nurse Corps LRP

There are also other types of student loan forgiveness for nurses as well, including the National Health Service Corps which provides financial aid to those who want to work as health care providers in high-need communities. If you’ve taken out federal Perkins loans, you may also be eligible for a partial Perkins loan cancellation

Student Loan Forgiveness for Doctors and other Healthcare Professionals

We love this guide to student loan forgiveness for doctors and other healthcare professionals, but here are some essential things to know:

You’re a Lawyer 

This is one of the best, to-the-point overviews of student loan forgiveness for lawyers, but the most common program is the Department of Justice Attorney Student Loan Repayment Program

Here are some key facts about the Department of Justice Attorney Student Loan Repayment Program:

  • This program for brand new lawyers, starts in spring, and requires 3+ years of working full-time for the Department of Justice. 
  • In exchange for this work, you’ll receive up to $6,000 toward your student loan debt.
  • You must have $10,000 or more in student loans (includes Stafford Loans, PLUS loans, Perkins loans, and others).
  • Payments from this program to your loan servicer are considered taxable income.
  • This is a highly competitive program, but that shouldn’t discourage you from applying!  

You’re in the Military 

Again, people in the US military can qualify for the PSLF program and various other forgiveness programs, including the Army Student Loan: Active Duty repayment program. 

There are also programs specifically geared toward members of the US Navy. This is a fantastically comprehensive guide to military student loan forgiveness that we highly recommend.   

Keep in mind that this list is in no way exhaustive, and that there may be other options for you out there. Here’s a resource we love that provides a complete list of student loan forgiveness programs and options out there currently. 

How to Manage or Reduce Your Student Loan Debt Without Student Loan Forgiveness 

If you’re not a candidate for any of the student loan forgiveness programs we mentioned above, there are few other routes you can take to manage or reduce your student loan debt.

#1 Pursue Income-Driven Loan Repayment

Income-driven student loan repayment allows you to make lower monthly payments if your current student loan payments are a substantial amount of your monthly income. 

The idea behind income-driven repayment programs is that if you still have a remaining balance after the terms of repayment (typically 20-25 years), your debt will be forgiven. 

Here are a few types of income-based student loan repayment options:

Revised Pay As You Earn Repayment Plan (REPAYE) 

With REPAYE, your monthly payments are generally about 10% of your discretionary income (income after taxes), divided by 12 months. These payments are also based on adjusted gross income (AGI), your family size, and your total federal student loan balance.

It’s also important to note that REPAYE is only applicable for Direct Loans. Other loan programs aren’t eligible.

Pay As You Earn Repayment Plan (PAYE)

The terms for PAYE are the same as those for REPAYE, but you must be a new borrower as of October 1, 2007. You must also have received a Direct Loan disbursement by October 1, 2011. A “new borrower” refers to someone who does not have an outstanding balance on a Direct Loan or FFEL Loan. 

Income-Based Repayment Plan (IBR) 

IBR is a repayment plan with monthly payments of about 15% of your discretionary income, divided by 12. Rates can go as low as 10% for new borrowers.

IBR is available to those with Direct Loans or FFEL loans. All other loan programs are ineligible.

Income-Contingent Repayment Plan (ICR Plan) 

The ICR plan provides monthly payments that are the lesser of either 1) your fixed monthly payment over 12 years, based on your income, OR 2) 20% of your discretionary income, divided by 12.

Please note that this plan is the only one available to borrowers with parent PLUS loans. It’s also important to understand that parents with PLUS loans can’t repay them under any of the income-driven repayment plans BUT they may consolidate their PLUS loans into a Direct Consolidation Loan and then make these payments under ICR.

Other things to know about Income-Driven repayment plans:

  • You can’t apply if you have any defaulted loans.
  • There is NO FEE to apply for IDRs. 
  • You will need to recertify your income each year.
  • If your income changes, you can submit new information and re-calculate your payments.
  • You may switch from one payment plan to another (provided you meet all of the eligibility requirements).
  • You will need an FSA ID to complete this process, which you can get here.
  • You will need to supply personal information including: your permanent address, your email address, your phone number, and the best time to reach you.
  • You will need to supply your financial information including your AGI (which you can automatically upload using a linked tool from the IRS or enter manually)

You can also make signing up for an Income-Driven Repayment plan incredibly easy by using Scholly Payoff

#2 Work for a Company That Provides Student Loan Repayment Assistance as an Employee Benefit

These days, many companies are starting to include student loan repayment as an employee benefit. This is an amazing way to get a substantial amount of debt relief. 

Here are some of the top companies that currently offer student loan repayment as a benefit:

Aetna

This insurance company matches full-time employees’ student loan payments for up to $2,000 a year (up to $10,000 total). Part-time employees can receive matching payments of $1,000 a year, or up to $5,000 total. 

Live Nation 

Event promoting company Live Nation matches up to $100 a month in student loan payments and up to $6,000 in total repayment.

Fidelity Investments

Employees who have been with the company for 6+ months are eligible to receive up to $2,000 in student loan repayment a year, and up to $10,000 total.

Nvidia

This tech company offers both full-time and part-time employees up to $6,000 a year and up to $30,000 total in student loan repayments! To be eligible, you must be employed at Nvidia for a minimum of 3 months and must have graduated college within 3 years of joining.

Chegg

This education tech company provides up to $1,000 a year to both full and part time employees toward student loan payments. The best part of this arrangement is that there is no cap on how much Chegg will provide over the years.

CommonBond

This lending and refinancing company provides its employees up to $100 per month for student loan repayment. There is also no reimbursement limit!

SoFi

This personal finance company offers employees up to $200 per month with no annual cap on loan reimbursement. One of the pioneers of employer student loan repayment programs, they’ve provided over $1 billion in student loan refinancing. 

Estée Lauder

The famed beauty product company, and all brands under it, provides employees up to $100 a month to pay off student loans, and up to $10,000 total.

Abbott

Abbott Laboratories, a pharmaceutical company, is committed to helping employees pay off their student loans AND save for the future. If you contribute 2% of your check to pay for student loans, Abbot will pay a 5% match to your 401k savings!

First Republic Bank

First Republic Bank, based in San Francisco, owns a start-up called Gradifi that specifically helps employers provide their employees with student loan assistance—and therefore helps its employees do the same. First Republic pays up to $100 a month during the first year of employment, $150 during the second, and $200 a month from that point on until the debt is fully paid.

Hulu 

You likely know Hulu from streaming TV shows and movies on it, but they’re also gaining a reputation for matching up to $1,200 a year in student loan repayment per year to employees.

Penguin Random House

Penguin is the first publishing company to offer its employees student loan reimbursement, offering up to $1,200 a year (and $9,000 total) to any full-time employee who has been with Penguin a year or more.

Carvana

Online used car retailer Carvana will pay up to $1,000 a year of employees student loans, and as of right now, there is no cap on repayment.

Peloton

The makers of one of the hottest selling stationary bikes on the market are now partnering with Gradifi to offer employees up to $100 monthly to pay off student loan expenses, with no current maximum repayment.

PwC

This massive accounting firm offers employees up to $1,200 a year in repayment assistance with a maximum cap of $10,000.

Similar to student loan repayment, many of those companies also offer tuition reimbursement or tuition assistance programs. How is this different from loan forgiveness? Well, sometimes it’s not, and the wording is just different. 

But sometimes “tuition reimbursement” refers to the repayment of all or some of the cost of college if you’re attending college and working. Employers are especially likely to offer this assistance if your schooling directly improves your ability to do the job you were hired to do, or helps you advance at the company.

Want to find more jobs with this type of education assistance? Here’s our list of 50 companies that offer tuition reimbursement

#3 Apply for Student Loan Payoff Programs

There are some awesome student loan payoff programs out there. As we’re sure you can imagine, they can be quite competitive. But, hey, you can’t win if you don’t apply! 

At Scholly, we regularly run student loan payoff contests. Check out all of our exciting opportunities here

Final Thoughts

Student loan forgiveness programs can be tremendously helpful if you qualify. Use the information we’ve shared in this post to find and apply for the right program for you. 

And if you don’t qualify for any of those programs, you might want to: 

  • Pursue an Income-Based Repayment Plan (Scholly PayOff can help you sign up quickly!)
  • Find an employer that provides student loan repayment assistance as an employee benefit
  • Apply for student loan payoff programs 

Of course, if you’re in good financial standing, you may also choose to work toward paying off your student loans on your own. In which case, be sure to check out our guide on how to pay off student loans fast

What about if you’re having trouble paying your loans? In that case, check out our post on what to do if you can’t pay your student loans. Good luck!