Student loans pose as a huge burden for most Americans pursuing their higher education. You can obtain relief from this financial stress if you can qualify for a federal student loan forgiveness. You can choose four programs to rule out or diminish your federal student loan balance based on the job or repayment plan that you choose. These are listed below.
Teacher Loan Forgiveness
In the case of teacher Loan Forgiveness, your loan balance can be canceled or reduced in just five years. If you have a long term teaching career plan, you can use both the Public Service Loan Forgiveness and Teacher Loan forgiveness for 15 years. Only direct loans and Stafford loans are eligible. Your chances of qualifying for the Teacher Loan Forgiveness is heightened if you have taught or plan to teach full time for five years in low-income public schools with a loan balance of $17500 or less. However, this is valid only for teachers who have taken a loan post-October 1st, 1998.
Public Service Loan Forgiveness
Your direct federal loans can be forgiven if you have worked or plan to work for the government or non-profit organizations for a minimum period of 10 years. You will be eligible for a Public Service Loan Forgiveness if you have repaid the full monthly loan installment on-time using an income-driven repayment plan. This program was kick-started in October 20017 and hence only those who have made all the 120 repayments since the date can qualify for a Public Service Loan Forgiveness.
Perkins Loan Cancellation
Up to 100% of a borrower’s Federal Perkins Loans are forgiven if they work or have worked in a public service job for at least five years. Public school teachers, police offers, nurses, firefighters are individuals who regularly qualify for this student loan forgiveness.
You are eligible for a student loan forgiveness if you adopt an income-driven repayment plan such as Pay As You Earn (PAYE) or Revised Pay As You Earn.