How Can I Receive Student Loan Forgiveness?
As a bankruptcy attorney in Saint Louis, one question I get asked frequently is: how do I receive student loan forgiveness? Student loans are a burden that weighs heavily on millions of Americans, and it’s one that can feel insurmountable at times. Well, the good news is that there are several ways to receive student loan forgiveness. In this article, I will be discussing some of the most popular types of student loan forgiveness options. But first things first:
What is Student Loan Forgiveness?
Student loan forgiveness programs allow borrowers to have all, or part of their student loans forgiven. This can be a significant relief for those who are struggling to make their monthly payments, and it can provide a pathway to financial stability. However, receiving student loan forgiveness is not always easy, and it requires careful consideration of your financial situation and your eligibility for the program.
Types of Student Loan Forgiveness Programs
Income-Based Repayment Plan
Income-Based Repayment Plans are designed to make monthly payments more affordable for those who have federal student loans. The program adjusts your monthly payment based on your income and family size. This means that your payments could be as low as $0 per month, depending on your income. After 20 or 25 years of making payments, the remaining balance of your loan may be forgiven. To qualify for this program, you must have a partial financial hardship. This means that your monthly payment under the standard repayment plan must be more than 10% of your discretionary income. You also need to have eligible loans, including Direct Subsidized Loans, Direct Unsubsidized Loans, Direct PLUS Loans made to graduate or professional students, and Direct Consolidation Loans.
Public Service Loan Forgiveness Program
The Public Service Loan Forgiveness Program (PSLF) is designed to forgive the remaining balance on your Direct Loans after you have made 120 qualifying monthly payments while working full-time for a qualifying employer. Qualifying employers include government organizations, non-profit organizations, and certain other types of employers. It’s worth noting that not all employment qualifies for PSLF. You must work for a qualifying employer full-time while making payments.
One-Time Student Loan Debt Relief
The one-time student loan debt relief program is a part of the Student Debt Relief Plan announced by the Biden-Harris Administration on August 24, 2022. The program aims to provide financial assistance to low-and middle-income families who are struggling to make ends meet while repaying their student loans. Under this program, eligible borrowers may receive up to $20,000 in debt relief if they received a Federal Pell Grant, or up to $10,000 if they did not receive a Pell Grant. To qualify for this program, borrowers must have their loans held by the Department of Education and have an individual income of less than $125,000 (or $250,000 for households). This is a one-time opportunity for those struggling with student debt. The program has been available starting from October 2022, and eligible borrowers will have until December 31st, 2023, to submit their application.
Bankruptcy Attorney in Saint Louis
If you are drowning in student loan debt and wondering if there’s a way out, there is! To learn more about these options and to see if you qualify, contact Charles H. Huber. As a bankruptcy attorney in Saint Louis, I can help navigate the complexities of student loan forgiveness and find the best solution for you. Take control of your student loan debt by contacting us today to schedule a consultation.