Student loans. What a frightening phrase to read! Have you been desperately scanning the internet, searching for answers to questions like, “Student loan forgiveness 2023” and “How to get student loan forgiveness?” It can be a daunting task to even start the search for solutions to your student debt. That’s why we’ve gathered some basic information to help you on your hunt for hope.
How do student loans work?
Student loans work like any other kind of loan: To pay for college, you borrow money, which you’ll need to repay later with interest. You may receive a federal loan through the U.S. government, or you can get a private student loan from a financial institution like your bank or credit union. Getting a federal loan typically costs you less than if you decide to take out a private student loan.
Below, we’ve listed the main types of loans that you may be dealing with:
Federal Direct Consolidation loan
You can combine several federal loans into one big loan. Usually, this type of loan protects you from losing the benefits of each student loan that you’re lumping into the larger one. This is a beneficial loan to take out because it makes it easier to repay later or switch your loan servicer if necessary.
Federal Direct PLUS loan
This loan is special because it’s available to graduate students and even to parents of dependent college students. Repayment can be deferred while the student is actively enrolled, up to six months after they graduate.
Direct subsidized loan
As long as an undergraduate student is enrolled at least half-time, they probably will not have to pay back this money while in college. They can have deferred payment for up to six months after graduation. The student must demonstrate that they have a legitimate financial need to meet the requirements for this loan.
Direct unsubsidized loan
This loan differs from a subsidized loan because the student can be an undergraduate or a graduate, and they need not demonstrate a legitimate financial need. They will need to start paying the interest on this loan while they are still in college.
Private student loan
Private loans from a bank, loan agency, or other kind of financial institution often require the student to have a cosigner. Once you start borrowing money, your loan will begin accruing interest. If you have a good credit score (or if your cosigner does) you may be able to get some good, low interest rates.
What is student loan forgiveness?
In the simplest terms, student loan forgiveness is the process wherein you can get your federal student loan debt forgiven, canceled, or discharged. The terms can be interchangeable. Forgiveness means that you don’t have to pay some or even all your student loans.
Who qualifies for student loan forgiveness?
The most common way that people go about having their student loans discharged is through the Public Service Loan Forgiveness program (PSLF). Once you have made 120, 240, or 300 payments—depending on the type of repayment plan you have—you may get your federal student loans forgiven if you are working for a public service employer who qualifies under the PSLF requirements. Have you been working in public government service or at a non-profit organization? It’s not certain, but you still may qualify for PSLF.
These are a few of the qualifying employers you need to work under to be eligible for PSLF:
- Not-for-profit organizations that count as tax-exempt under Section 501(c)(3) of the Internal Revenue Code.
- U.S. government organizations, including local, tribal, state or federal.
- Not-for-profit organizations wherein the majority of full-time employees perform public services that qualify for PSLF.
To qualify for PSLF, you’ll also need to either already have Direct Loans or consolidate your other federal student loans into a Direct Loan.
How to apply for student loan forgiveness?
Though student loan forgiveness may sound complicated, it’s relatively simple to be considered for PSLF. All you have to do is fill out and submit a PSLF form. You can use the PSLF Help Tool on studentaid.gov for the easiest process. The PSLF Help Tool allows you to perform several steps in quick succession:
- Find out if your employer counts as a qualifying employer.
- Ask for your employer’s eligibility to be reviewed if you cannot find it in the database.
- Fill out your PSLF form, and make sure you request certification and signature from your qualifying employer. You can do all this electronically.
- If you are unable to complete your PSLF form electronically, you can generate it for manual signature and submission.
How to fill out a loan forgiveness application
Let’s take a look at how to fill out a loan forgiveness application manually. You’ll need to download and print a blank PDF of the loan forgiveness form and ensure that you fill out and sign all necessary sections. Remember to have your qualifying employer or employers sign it as well. If you are not sure if you’ve already paid your required number of payments, the recipients of your completed form will alert you if the answer is affirmative.
MOHELA is the federal loan servicer who administers the PSLF program on behalf of studentaid.gov. You’ll want to send your physical loan application form to them at this mailing address or this fax number:
U.S. Department of Education
MOHELA
633 Spirit Drive
Chesterfield, MO 63005-1243
Fax: 866-222-7060
How can LegalShield help with student loan forgiveness?
You don’t have to handle student loan forgiveness on your own. A lawyer’s help is crucial as you navigate the complexities of student loan forgiveness. Get the legal protection that’s right for you and your student loan forgiveness process.
Student loan forgiveness can seem like a daunting task. LegalShield offers legal advice in an affordable monthly membership. Your LegalShield provider law firm can review paperwork, write a letter or make a phone call to help protect your rights as a consumer!
Here are some tips to find out if you qualify for student loan forgiveness as of this past year.
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