Frequently Asked Questions About Student Loan Forgiveness and Discharge

Are you struggling to repay student loans? Are you considering personal bankruptcy but recognize that it can be difficult to receive a bankruptcy discharge for your hefty student loan balance? If you owe a substantial amount of money in student loans, you might be wondering if there are any other options to have your loans forgiven, canceled, or discharged. Generally speaking, if most of your loans are private, you are going to have a more difficult time having your loans forgiven than if most of your debt involves federal student loans. However, the good news is that many borrowers may be eligible for federal student loan discharge or forgiveness, and a number of them do not even know it.
So, in what situations can you apply to have your federal loans forgiven, canceled, or discharged? According to a fact sheet from Federal Student Aid, an office of the U.S. Department of Education, the following represent some frequently asked questions about qualifying for student loan forgiveness.
Types of Student Loan Forgiveness, Discharge, and Cancellation
Even if you do not finish school or cannot find a job after taking out substantial federal student loans, you still need to repay what you owe. However, there may be options available to you that can allow you to seek forgiveness, discharge, or cancellation of the loans. Here are programs for which you may be eligible:
  • Total and Permanent Disability (TPD) discharge: If you have certain direct loans, Perkins loans, or Federal Family Education Loans (FFEL) and you have become “totally and permanently disabled,” you can apply for a TPD discharge. How can you prove that you have a total and permanent disability? You can submit documentation from the U.S. Department of Veterans Affairs or a physician that certifies that you are disabled, or you can provide proof that you currently are receiving Social Security Disability Insurance (SSDI) or Supplemental Security Income (SSI) benefits that are scheduled to last for a certain period of time.
  • Teacher Loan Forgiveness: Are you currently working as a teacher, and did you begin borrowing your loans after 1998? Are you also teaching full-time in a low-income school, and have you been doing so for at least five years on a consecutive basis? You may be eligible to have up to $17,500 of subsidized or unsubsidized loans forgiven.
  • Public Service Loan Forgiveness: for federal student loan borrowers who work in specific public service professions and make at least 120 payments on direct loans (beginning after 2007), those borrowers can apply to have the balance of their federal student loans forgiven. However, it is important to keep in mind that you must be repaying under specific plans in order to be eligible, and you cannot be in default.
There are also other ways to seek forgiveness, cancellation, and discharge of your student loans that you can discuss with an experienced consumer protection attorney.
Contact a Consumer Advocate in Oak Park
If you are struggling to repay your student loans and have questions about your options, a dedicated Oak Park consumer protection lawyer can assist you. Contact the Emerson Law Firm today to learn more about our services.
See Related Blog Posts:
Overdraft Fees, Consumer Debt, and Bankruptcy

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