The burden of student loans can be overwhelming, but there are several student loan forgiveness programs that can help ease this financial strain. While many borrowers are familiar with the popular Public Service Loan Forgiveness (PSLF) program, there are lesser-known options that could provide relief for those who qualify.
Here are seven unexpected student loan forgiveness programs you might not have heard about yet.
1. Teacher Loan Forgiveness Program
The Teacher Loan Forgiveness Program is designed for educators who work in low-income schools or educational service agencies.
Qualified teachers can receive up to $17,500 in loan forgiveness on their Direct Subsidized and Unsubsidized Loans and Subsidized and Unsubsidized Federal Stafford Loans. To be eligible, teachers must:
- Teach full-time for five consecutive academic years.
- Work in a school or educational service agency that serves low-income families.
- Be considered a highly qualified teacher, meaning they hold at least a bachelor’s degree and have received full state certification.
This program is an excellent opportunity for teachers committed to serving underprivileged communities.
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2. Perkins Loan Cancellation and Discharge
For those with Federal Perkins Loans, there are various cancellation and discharge options available based on the borrower’s profession or circumstances.
Eligible borrowers can potentially have up to 100% of their loans canceled over five years of qualifying service. Professions that qualify include:
- Teachers serving in low-income schools or teaching specific subjects such as math, science, or special education.
- Law enforcement or corrections officers.
- Nurses and medical technicians.
- Public defenders.
- Librarians with a master’s degree working in Title I schools.
The percentage of loan forgiveness increases with each year of service, making it an attractive option for those in these fields.
3. Income-Driven Repayment (IDR) Plan Forgiveness
Income-Driven Repayment Plans adjust your monthly student loan payments based on your income and family size, and offer loan forgiveness after 20 or 25 years of qualifying payments. These plans include:
- Income-Based Repayment (IBR)
- Pay As You Earn (PAYE)
- Revised Pay As You Earn (REPAYE)
- Income-Contingent Repayment (ICR)
While these plans extend the repayment period, they provide forgiveness of any remaining balance after the repayment term ends. This can be particularly beneficial for those with lower incomes relative to their student loan debt.
4. State-Sponsored Loan Forgiveness Programs
Many states offer loan forgiveness programs for residents who work in specific professions. These programs vary widely but often target fields such as healthcare, teaching, and public service. For example:
- California’s Assumption Program of Loans for Education (APLE) offers up to $11,000 in loan forgiveness for teachers in high-need schools.
- The New York State Young Farmers Loan Forgiveness Incentive Program provides up to $10,000 annually for qualified applicants who operate a farm in New York for five years.
These programs not only help reduce student loan debt but also encourage professionals to work in areas with the greatest need.
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5. Military Student Loan Forgiveness Programs
The military offers several student loan forgiveness programs to service members as part of their benefits. These include:
- Public Service Loan Forgiveness (PSLF) for military personnel, which forgives the remaining balance after 120 qualifying payments while serving in the military.
- The Military College Loan Repayment Program (CLRP), which repays up to $65,000 of federal student loans for eligible members of the Army, Navy, Air Force, and National Guard.
These programs are designed to attract and retain talented individuals in the armed forces, providing financial relief in exchange for service.
6. National Health Service Corps (NHSC) Loan Repayment Program
Healthcare professionals who commit to working in underserved areas can benefit from the NHSC Loan Repayment Program. This program offers up to $50,000 in loan repayment assistance for two years of full-time service, or up to $25,000 for part-time service. Eligible professions include:
- Primary care physicians.
- Dentists.
- Nurse practitioners.
- Certified nurse-midwives.
- Behavioral health providers.
The NHSC program aims to improve access to healthcare in communities that need it most, while also alleviating the financial burden on healthcare providers.
7. Attorney Student Loan Repayment Program (ASLRP)
The Department of Justice offers the Attorney Student Loan Repayment Program (ASLRP) to recruit and retain qualified attorneys. Participants can receive up to $6,000 per year in loan repayment assistance, with a maximum benefit of $60,000. Eligible attorneys must commit to a three-year service obligation with the Department of Justice.
This program is particularly beneficial for attorneys entering public service roles who may have accumulated significant student loan debt during their legal education.
Conclusion
While managing student loan debt can be daunting, exploring these lesser-known forgiveness programs can provide significant relief. Whether you’re a teacher, healthcare professional, military service member, or working in public service, there are options available to help reduce your financial burden.
Investigating these programs and understanding the eligibility requirements can be the first step toward financial freedom from student loans.