The promise of at least ten years repaying a student loan can be daunting and discouraging for many young graduates. A lot of money was put into their education, and not every student is absolutely guaranteed a position in their field. Perhaps college just wasn’t right for you, and you dropped out in order to obtain a job. Maybe you weren’t satisfied with the education you received. Whatever the circumstances, you’re still expected to repay any and all loans you took out. However, there are some circumstances in which a student loan can be forgiven, discharged, or cancelled. Let’s take a look at some of the possibilities.
Many students went to college after participating in military service. The military would have paid for some of the tuition involved in university, but some students still need federal loans to pay off the remaining bills. With a war currently occurring, some students will have reenlisted and shipped off to Afghanistan or Iraq, among other places. In the unfortunate circumstance that these veterans faced a debilitating and permanent injury directly linked to the service, some or all of those loans can be discharged or forgiven. Even people who were not in the service but still cannot work due to a permanent injury can file to have their student loans discharged. This is not something anyone could ever look forward to, and not something we hope you’ll ever have to file for.
Another opportunity for forgiveness arises when you file for bankruptcy. This is not a sure-fire solution and should never be taken lightly. The only way a loan can be discharged after filing for bankruptcy is to prove that repaying that loan would cause undue hardship and bar the borrower from maintaining a minimal standard of living. Furthermore, the borrower should have made at least some payments towards their loan. Sometimes, the requirement is having paid the loan off for five years. Remember to never file for bankruptcy unless it literally is a last resort, and always look at other options first.
In the highly unlikely case that your school closes either during or up to 90 days after you were enrolled, all of the student loans could be forgiven and discharged. As noted, it is a highly unlikely case, and definitely not one that you should hope for.
The final qualification is one that seems a bit more likely. If you are a teacher in a low-income elementary or secondary school for at least five years, up to $17,500 of your loans could be forgiven. Along with teachers, public service workers, including anyone that works for a non-profit agency or for a federal, state, or local agency, can file for student loan forgiveness under the Public Service Loan Forgiveness Program. Under this program, if you have made 120 on-time payments towards your student loans and have worked full-time for the aforementioned employers, the remaining balance on your student loans could be forgiven.
If any of these situations pertain to you, contact your loan provider to see if you qualify for loan forgiveness or cancellation. You never know what could come of one simple phone call.