Student loan forgiveness is generally only offered to federal student loans and will require you to meet specific eligibility requirements for your respective forgiveness program. After meeting those requirements generally, you will need to submit an application to formally request forgiveness. Student loan forgiveness isn’t available to everyone, but for those who are eligible for forgiveness it can remove some, if not all, of your student loan debt. Understanding program qualification requirements and various application processes can be confusing, but we will walk you through your federal student loan forgiveness options. If you are not sure about your specific loan terms and your eligibility for forgiveness, contact your student loan servicer to learn what student loan forgiveness options are available to you.
What is Student Loan Forgiveness?
Student loan forgiveness can eliminate student loan debt if you meet the criteria for an existing forgiveness program. Student loan forgiveness isn’t your only option to eliminate your debt your student loan debt, there are also student loan discharge options. The main difference between student loan forgiveness and discharge are the circumstances that qualify you for one or the other. Generally, student loan forgiveness is offered to borrowers who have met a certain service requirement, like working 10 years for an eligible public service employer for Public Service Loan Forgiveness (PSLF). Student loan discharge is offered to borrowers facing unfortunate circumstances, like fraud, total and permanent disability of the borrower, or death.
When it comes to student loan forgiveness, the amount forgiven can be fully or partially canceled. Dependent upon the type of loan you have (federal or private), your repayment plan, career, employer, and personal finance situation there may be forgiveness programs available to you. While being relieved from your student loan debt sounds like an attractive option, know that it is not available to everyone and for those that are eligible, there are strict requirements that must be met to be approved.
Student loan forgiveness programs such as the federal government’s Public Service Loan Forgiveness (PSLF) require that you qualify for forgiveness, usually through your type of employment and typically requires repayment for a certain number of years before an application can be submitted.
Forgiveness or cancelation may take several years to qualify for. As of right now, student loan forgiveness is not considered taxable until 2025, which has been a recent change. If you are being contacted about a student loan forgiveness option that seems too good to be true, it probably is. You want to make sure you validate any forgiveness program directly with your student loan servicer (through your portal or by calling a phone number your received from a trusted source). Unfortunately, there are student loan forgiveness scams out there looking to take advantage of people in need. And as experts in student loan repayment, we can confirm to you, there is no such thing as a program called Obama Student Loan Forgiveness, or Biden Student Loan Forgiveness—essentially, if you are offered a forgiveness program with the use of a president’s name, don’t entertain the phone call and hang up.
MORE>>>How to Avoid Student Loan Forgiveness Scams
Eligibility Requirements for Student Loan Forgiveness
It’s not uncommon for forgiveness programs to have unique requirements along with a specific application that must be submitted before loan forgiveness is considered Be aware that there should be no cost in applying for loan forgiveness through a federal program as there is also no application fee. You can get application forms from your loan servicer or from the U.S. Department of Education Federal Student Aid Repayment forms.
PSLF Requirements
The U. S. Department of Education announced on Oct. 6, 2021, that some requirements for the PSLF will be waived for a limited time, until and through Oct. 31, 2022. Let’s touch on how PSLF works and the requirements prior to the waivers.
Essentially prior to the waivers, to qualify for PSLF you would need to make 120 qualifying payments on an eligible Direct Loan, in an eligible repayment plan, while working full-time for an eligible employer. Borrowers in the FFEL program had the option to consolidate into the Direct Loan program with a Direct Consolidation Loan, however, they would need to make 120 qualifying payments after consolidating. Borrowers in the Direct Loan program would need to make 120 qualifying payments, in an eligible repayment plan. Eligible repayment plans include the 10-year Standard Repayment Plan, and any income-driven repayment plan. Qualifying employers include any US, federal, state, local or tribal government, or an eligible 501(c)(3) nonprofit organization.
After meeting the requirements and completing 120 qualifying payments, you can submit an application for PSLF. However, it is recommended that you annually complete an Employment Certification Form (ECF) annually. The ECF allows you to determine how many qualifying payments you have made, and to make sure you are on the right track for PSLF.
The U.S. Department of Education offers the PSLF Tool to help you complete ECFs and the PSLF application.
PSLF Limited Waivers
Prior to the waivers, under two percent of PSLF applications were being approved. When the Biden administration announced the waivers, they essentially made it far easier to qualify and they expect to forgive billions of dollars due to these implemented waivers.
Under the PSLF waivers, borrowers will have all months in a repayment status counted (regardless of type of federal student loan, repayment plan, and if payments were made on time), as long as the borrower meets the employment requirements—only months in repayment will be counted as a qualifying payment if the borrower was working full-time for an eligible employer. Periods of forbearance of 12 consecutive months or greater or 36 cumulative months or greater, and months spent in deferment prior to 2013 will be counted under the waiver. The Department of Education will also include Economic Hardship Deferment beginning on or after Jan. 1, 2013. Please be advised that in fall 2022, the Department of Education will begin making account adjustments to include these periods. It may be a good idea to monitor your account or check with your loan servicer to ensure these periods have been added.
FFEL, Perkins, and other loan borrowers will still need to consolidate their loans into the Direct Loan program, however the months in repayment on or after Oct. 1, 2007, will count as a qualifying payment. FFEL, Perkins or other federal student loan programs, for example, those from older loan programs, such as Federally Insured Student Loans [FISL] or National Defense Student Loans [NDSL]), you must consolidate those loans into the Direct Loan program by Oct. 31, 2022. Borrowers only have until Oct. 31, 2022, to consolidate their loans into the Direct Loan program.
Direct loan borrowers who were making payments in an ineligible repayment plan can now have their months in repayment count towards their 120 qualifying payments.
There is one exception, Parent PLUS Loans. Parent PLUS loans, even Direct PLUS loans made to a parent, are not eligible for PSLF unless the borrower consolidates the loan with a Direct Consolidation Loan. The Direct Consolidation Loan is eligible (even if a Parent PLUS loan was included) for PSLF and qualifying payments will be counted on that loan.
Prior to the Oct. 31, 2022 deadline, FFELP, Perkins, and other loan borrowers looking for student loan forgiveness must do the following:
- Consolidate loans into a Direct Consolidation Loan or submit a consolidation application by Oct. 31, 2022.
- Have submitted a PSLF Certification and Application Form to the PSLF Servicer or have used the PSLF Help Tool on StudentAid.gov to generate your form of request that the Department uses to determine whether your employer qualifies or not on or before Oct. 31, 2022, so long as the submitted form is approved later.
Borrowers with less than 120 payments will still get credit towards the 120 payments, and lock in credit, for qualifying payments under these waivers. Do not wait as the waivers will expire on Oct. 31, 2022! If you have worked for an eligible employer, at any point, lock in your qualifying payments.
Loan Forgiveness Programs
The following federal programs have been created to help those looking for federal student loan forgiveness. Click on the following links for more information about forgiveness programs that you feel may apply to you:
- Teacher Loan Forgiveness
- Public Service Loan Forgiveness (PSLF)
- Closed School Discharge
- Borrower Defense to Repayment
- Total and Permanent Disability Discharge
- Perkins Loan Cancellation and Discharge
- Discharge Due to Death
- Discharge in Bankruptcy (rare)
- Borrower Defense Loan Discharge
- False Certification Discharge
- Unpaid Refund Discharge
Student Loan Relief beyond Student Loan Forgiveness
If the programs above are not applicable to you but you still need help making your monthly student loan payments, talk with your loan servicer about different options to help.
Change your Repayment Plan
Your choices for possible student loan repayment plans vary depending on the kind of student loans borrowed, federal or private. Federal student loans have a variety of repayment options, and you can change repayment plans at no cost to you. Private student loans also have repayment plans, but no matter if you have a federal or private student loan, you should contact your loan servicer if making your monthly payment is becoming difficult, to learn what if any options are available to you.
Consolidate or Refinance
In trying to deal with multiple student loan lenders, you may want to explore what loan refinance or consolidation can do for you. A Federal Direct Consolidation Loan can take two or more federal student loans and turn them into one new loan. No private loans can be included with federal direct loan consolidation.
Private refinance loans (also called private student loan consolidation) can refinance federal student loans, private student loans, and loans financed by states or schools together. It’s important to note, that refinancing federal loans with a private lender will forfeit any federal loan benefits you may have.
If you can find better terms such as a lower APR and repayment terms that fit your budget, then it might be advantageous to explore refinancing your student loans. While you are not required to include all your loans, if you are looking to reduce your number of monthly bills, consolidation can be a helpful option.
Best Student Loan Refinance Lenders
SoFi Student Loans
- Rates as low as 1.74% variable and 3.49% fixed1
- No fees or prepayment penalties
- Unemployment protection
1Fixed rates range from 3.49% APR to 7.99% APR with a 0.25% autopay discount. Variable rates from 1.74% APR to 7.99% APR with a 0.25% autopay discount. Unless required to be lower to comply with applicable law, Variable Interest rates on 5-, 7-, and 10-year terms are capped at 8.95% APR; 15- and 20-year terms are capped at 9.95% APR. Your actual rate will be within the range of rates listed above and will depend on the term you select, evaluation of your creditworthiness, income, presence of a co-signer and a variety of other factors. Lowest rates reserved for the most creditworthy borrowers. For the SoFi variable-rate product, the variable interest rate for a given month is derived by adding a margin to the 30-day average SOFR index, published two business days preceding such calendar month, rounded up to the nearest one hundredth of one percent (0.01% or 0.0001). APRs for variable-rate loans may increase after origination if the SOFR index increases. The SoFi 0.25% autopay interest rate reduction requires you to agree to make monthly principal and interest payments by an automatic monthly deduction from a savings or checking account. This benefit will discontinue and be lost for periods in which you do not pay by automatic deduction from a savings or checking account. The benefit lowers your interest rate but does not change the amount of your monthly payment. This benefit is suspended during periods of deferment and forbearance. Autopay is not required to receive a loan from SoFi.
College Ave Student Loans
- Variable rate range: 3.44% – 6.64% APR1
- Fixed rate range: 3.49% – 6.74% APR1
- No application or prepayment fees
- Apply in 3 minutes or less for instant credit decision
College Ave Student Loans products are made available through Firstrust Bank, member FDIC, First Citizens Community Bank, member FDIC, or M.Y. Safra Bank, FSB, member FDIC.. All loans are subject to individual approval and adherence to underwriting guidelines. Program restrictions, other terms, and conditions apply.
1The 0.25% auto-pay interest rate reduction applies as long as the borrower or cosigner, if applicable, enrolls in auto-pay and authorizes our loan servicer to automatically deduct your monthly payments from a valid bank account via Automated Clearing House (“ACH”). The rate reduction applies for as long as the monthly payment amount is successfully deducted from the designated bank account and is suspended during periods of forbearance and certain deferments. Variable rates may increase after consummation.
2This informational repayment example uses typical loan terms for a refi borrower who selects the Full Principal & Interest Repayment Option with a 10-year repayment term, has a $40,000 loan and a 5.5% Annual Percentage Rate (“APR”): 120 monthly payments of $434.11 while in the repayment period, for a total amount of payments of $52,092.61. Loans will never have a full principal and interest monthly payment of less than $50. Your actual rates and repayment terms may vary.
3$5,000 is the minimum requirement to refinance. The maximum loan amount is $250,000 for those with medical, dental, pharmacy or veterinary doctorate degrees, and $150,000 for all other undergraduate or graduate degrees.
Information advertised valid as of 4/12/2022. Variable interest rates may increase after consummation. Approved interest rate will depend on the creditworthiness of the applicant(s), lowest advertised rates only available to the most creditworthy applicants and require selection of full principal and interest payments with the shortest available loan term.
Splash Financial Refinance Loan
- Rates as low as 1.74%1 Variable APR and 1.99%1 Fixed APR
- No pre-payment penalties, origination, or application fees
- See rates in 3 minutes without affecting your credit score2
1The rates displayed may include a 0.25% autopay discount.
2To check the rates and terms you qualify for, Splash Financial conducts a soft credit pull that will not affect your credit score. However, if you choose a product and continue your application, the lender will request your full credit report from one or more consumer reporting agencies, which is considered a hard credit pull and may affect your credit.
Earnest Student Loan Refinancing
- Variable rates starting at 1.74% APR (including 0.25% Auto Pay discount)*
- Fixed rates starting at 2.74% APR (including 0.25% Auto Pay discount)*
- Choose your own monthly payment
- No fees of any kind and exceptional customer service for the life of your loan
- Check your rate in under 2 minutes
To qualify, you must be a U.S. citizen or possess a 10-year (non-conditional) Permanent Resident Card, reside in a state Earnest lends in, and satisfy our minimum eligibility criteria. You may find more information on loan eligibility here: https://www.earnest.com/eligibility. Not all applicants will be approved for a loan, and not all applicants qualify for the lowest rate. Approval and interest rate depend on the review of a complete application.
Actual rate and available repayment terms will vary based on your income. Fixed rates range from 2.99% APR to 8.24% APR (excludes 0.25% Auto Pay discount). Variable rates range from 1.99% APR to 8.24% APR (excludes 0.25% Auto Pay discount). Earnest variable interest rate student loan refinance loans are based on a publicly available index, the 30-day Average Secured Overnight Financing Rate (SOFR) published by the Federal Reserve Bank of New York. The variable rate is based on the rate published on the 25th day, or the next business day, of the preceding calendar month, rounded to the nearest hundredth of a percent. The rate will not increase more than once per month. The maximum rate for your loan is 8.95% if your loan term is 10 years or less. For loan terms of more than 10 years to 15 years, the interest rate will never exceed 9.95%. For loan terms over 15 years, the interest rate will never exceed 11.95%. Please note, we are not able to offer variable rate loans in AK, IL, MN, NH, OH, TN, and TX.
*Auto Pay Discount: If you make monthly principal and interest payments by an automatic, monthly deduction from a savings or checking account, your rate will be reduced by one quarter of one percent (0.25%) for so long as you continue to make automatic, electronic monthly payments. This benefit is suspended during periods of deferment and forbearance. Not all borrowers will qualify for our lowest rates, and your rate will be based on creditworthiness at time of application.
The information provided on this page is updated as of 4/29/2022. Earnest reserves the right to change, pause, or terminate product offerings at any time without notice.
Earnest loans are originated by Earnest Operations LLC. California Finance Lender License 6054788. NMLS # 1204917. Earnest Operations LLC is located at 303 2nd Street, Suite 401N, San Francisco, CA 94107. Terms and Conditions apply. Visit https://www.earnest.com/terms-of-service, e-mail us at [email protected], or call 888-601-2801 for more information on our student loan refinance product.
You Put in the Work. Now Reap the Rewards.
- Variable Rates between 1.87% - 6.52% APR1
- Fixed Rates between 2.30% - 5.96% APR1
- No application or prepayment fees
- Cosigner release with 24 consecutive on-time payments2
1Interest Rates
Fixed interest rates range from 2.30% APR (with auto debit discount) to 5.96% APR (without auto debit discount). Your interest rate will depend on your (and if applicable, your cosigner’s) credit qualifications. The fixed interest rate will remain the same for the life of the loan.
Variable interest rates range from 1.87% APR (with auto debit discount) to 6.52% APR (without auto debit discount). Your interest rate will depend on your (and if applicable, your cosigner’s) credit qualifications. Variable rates may increase after consummation. Variable rates for Nelnet Bank Refinance Loans are calculated as the One-Month SOFR plus the applicable Margin percentage. Variable rates will be based on the highest One-Month SOFR as published by the Federal Reserve Bank of New York and/or the Wall Street Journal “Money Rates” table on the twenty-fifth day (or the next business day) of the immediately preceding calendar month. The variable rate may change on the first day of each month if the SOFR index changes. This may result in higher monthly payments. The current One-Month SOFR index is 0.05% as of January 1, 2022.
Auto Debit Interest rate reduction of .25% for automatically withdrawn payments from any designated bank account (“auto debit discount”). Auto debit discount applies when full payments (including both principal and interest) are automatically drafted from a bank account. The auto debit discount will continue to apply during periods of approved forbearance or deferment if the auto debit discount was in effect at the time of receiving the forbearance or deferment. Auto debit discount will remain on the account unless (1) the automatic deduction of payments is canceled or (2) there are three consecutive automatic deductions returned for insufficient funds at any time during the term of the loan.
The lowest rate for each loan type requires automatically withdrawn (“auto debit”) payment. The lowest rate is available only to the most creditworthy applicants. Not all borrowers will receive the lowest rate. The interest rate and Annual Percentage Rate (APR) may be higher depending upon (1) the credit history of the borrower and, if applicable, the cosigner, (2) the repayment option and loan term selected, (3) the loan type selected, and (4) the highest level of education attained. If approved, applicants will be notified of the rate qualified for within the stated range.
2Cosigner Release. A request for the cosigner to be released can be made by either the borrower or cosigner when each of the following conditions has been met:
- The account must have been in full principal and interest repayment for at least 24 months.
- Twenty-four consecutive, on-time principal and interest payments, or lump sum equivalent, must have been made. NOTE: A lump sum payment does not replace the requirement to have been in full principal and interest repayment for at least 24 months. Interest-only or fixed-pay payments while enrolled in school do not qualify towards the 24 consecutive on-time payments.
- The loan must be current at the time of request.
- The loan must not have been in deferment, hardship forbearance, or other alternative payment assistance plan within the past 24 months.
- The loan must not have been permanently modified from its original terms in the credit agreement.
- The primary borrower must be a U.S. citizen or have permanent residency in the United States.
- The primary borrower must meet the age of majority requirement in their permanent state of residency.
Requirements are subject to change. If all of these conditions have been met, then an application for cosigner release may be submitted. The primary borrower is required to demonstrate they have the ability to assume sole responsibility for the loan(s) by providing proof of income, meeting debt-to-income requirements, and having a satisfactory credit history. (A credit report will be obtained during the review process).
3Refinance Loan Eligibility: You must be a U.S. citizen or permanent resident alien with a valid U.S. Social Security number, and be the legal age to enter into binding contracts in your state/territory of residency, or be at least 17 years of age and apply with a cosigner who is at least the age of majority in their state/territory. Non-residents can apply with an eligible cosigner who is a U.S. citizen or permanent resident alien with a valid U.S. Social Security number. The student loans you refinance must be in their grace or repayment period, and you can no longer be enrolled in school on a half-time or more basis. You must have at least $5,000 in student loans to refinance. You, or your eligible cosigner, must have an annual income of at least $36,000. Approval subject to credit review. Other credit criteria may apply.
Refinance Loan Limits:
Minimum loan amount: $5,000
Maximum student loan limits:
$125,000 for borrowers with an undergraduate degree.
$175,000 for borrowers with a graduate, MBA, or law degree.
$500,000 for borrowers with a graduate health professional degree.
Nelnet Bank, and any associated logos or design marks, are trademarks or service marks of Nelnet, Inc. All loan programs and terms are subject to change or may be discontinued at any time without notice. Certain restrictions and limitations may apply.
Apply for Deferment or Forbearance
Deferment or forbearance enable your lender to temporarily modify the payment obligation on your education loan. Both private and federal student loans offer deferment and forbearance, but the terms will vary. Forbearance can temporarily cease your monthly payments, temporarily reduce the monthly payment amount, or extend the timeframe for the repayment. Federal student loans offer a variety of deferment types depending on your circumstances, and each has its own set of eligibility criteria.
During a deferment, you are not required to make monthly or quarterly principal payments. When you are placed in either deferment or forbearance, the interest on your loan may continue to accrue (build) and will be capitalized (added to the loan balance) if left unpaid. If you are in possession of a subsidized federal student loan such as a federal Perkins Loan or a Direct Subsidized Loan, the government will pay the interest during a deferment. Loans such as PLUS loans and Direct Unsubsidized Loans require you to be responsible for the interest while in deferment. If not paid, the interest will be capitalized with the balance of the loan when repayment resumes.