It’s little surprise that many of America’s 45 million student loan borrowers are looking to loan forgiveness programs to ease their burden.
But while loan forgiveness sounds like a dream come true, you might be waiting a while: Some programs don’t discharge your loan for a decade or more.
If you’re looking to get rid of your student loans ASAP, here are your options — from the quick to the slow and everything in between.
|Program||How long for forgiveness?|
|Student loan discharge for special circumstances||Immediately|
|Student loan repayment assistance programs||Varies, but typically 2 to 3 years|
|Teacher Loan Forgiveness||5 years|
|Public Service Loan Forgiveness||10 years|
|Forgiveness from income-driven repayment plans||20 or 25 years|
1. Student loan discharge for special circumstances
Amount of time for loan forgiveness: Immediately
If you have a special circumstance that makes you unable to pay your loans, student loan discharge programs could get rid of your balance right away. While most borrowers probably won’t have these exceptional circumstances, they’re worth noting in case you qualify.
Among the criteria that could discharge your loan balance immediately:
- Total and permanent disability discharge: For borrowers who have suffered a permanent disability.
- Closed school discharge: If your school closed while you were enrolled or shortly after you withdrew
- Discharge for false certification, unauthorized payment or unpaid refund: For victims of identity theft or if your school didn’t pay a refund owed to the government or a lender
- Borrower defense discharge: Available to those who can prove they were defrauded by their school — though note that the courts just recently ordered the Department of Education to reinstate this rule, so there’s a large backlog of applications
- Discharge in bankruptcy: If you can qualify under Chapter 7 or Chapter 13 bankruptcy (rare but not impossible)
Apart from the time it takes to collect and process documents, these loan discharge programs should cancel your student loan debt right away if you qualify (assuming there are no more roadblocks from the federal government).
2. Student loan repayment assistance programs (LRAPs)
Amount of time for loan forgiveness: Varies, but typically two to three years
Chances are, you don’t have a special circumstance that qualifies you for the loan discharge programs above. But you might be eligible for a loan repayment assistance program (LRAP) from the federal government, state government, private organization or university.
Unlike forgiveness programs, which cancel your debt balance, most LRAPs give you money to pay off a big chunk of your debt at once. Some will also pay off a percentage of your debt each year until your debt is gone.
Most LRAPs have professional requirements, asking that you work in a certain field for a few years, often in a nonprofit organization or with an underserved population. But unlike the Public Service Loan Forgiveness (PSLF) discussed below, these programs don’t ask for 10 years of service.
Some jobs that qualify for various loan repayment assistance programs include doctors, nurses, teachers, veterinarians, pharmacists, dentists and military service members and veterans. But there are still others — the state of Maine, for example, also has an LRAP for STEM professionals.
Here are just a few examples of LRAPs so you can get a sense of how they typically work.
- NURSE Corps Loan Repayment: Forgives up to 60% of your student loan balance after two years of working as a nurse in an underserved area, plus an additional 25% for a third year of service.
- John R. Justice Student Loan Repayment Program: Awards up to $10,000 per year in student loan assistance to public sector lawyers for a maximum of $60,000.
- National Health Service Corps (NHSC) loan repayment assistance: Provides up to $50,000 to health care providers who commit to working at an eligible site for two years.
- California State Loan Repayment Program: Offers up to $110,000 to health care providers who commit to two to six years in a professional shortage area in California.
- University of Virginia School of Law Loan Forgiveness: Provides benefits that will cover 100% of your law school loans if you graduated from the University of Virginia and go on to make less than $55,000 per year.
These LRAPs could help you pay off a hefty portion of your student loans, and many only ask for two to three years of service. Even if you don’t want to stay in your role long term, this award of loan assistance could be worth spending a little while in a qualifying job. Check out our comprehensive list of LRAPs here.
3. Teacher Loan Forgiveness
Amount of time for loan forgiveness: Five years
Next up is the Teacher Loan Forgiveness program, which forgives up to a certain amount of your loans if you work for five consecutive years in a qualifying school.
Most elementary school teachers receive up to $5,000 in loan forgiveness at the end of their five years. But high school teachers who work in math, science or special education could get up to $17,500 in loan forgiveness.
Although you don’t have to spend your entire career in a low-income school or educational agency for this program, five years is still a significant amount of time. Think about your career and financial goals so you can decide whether this program is the right choice for you.
4. Public Service Loan Forgiveness (PSLF)
Amount of time for loan forgiveness: 10 years
Perhaps the best-known student loan forgiveness program, PSLF forgives your federal student loans after 120 qualifying payments, which typically span 10 years. You can get PSLF if you work in an eligible organization, such as a nonprofit or government agency.
It usually doesn’t matter what your specific job is, as long as your workplace qualifies. So while PSLF offers more flexibility in terms of what job you do, it does entail a fairly large time commitment.
If you’re already drawn to public service, spending a decade at a nonprofit probably won’t feel like a sacrifice. But if you’d prefer to move into the private sector (perhaps with a company that offers a student loan-matching benefit), you’ll have to weigh your options.
After all, you could potentially make a higher income in another job, which could be more valuable than the loan forgiveness you’d get from PSLF. Plus, finding a job that’s fulfilling and makes you happy over the long run is an important consideration, too.
Outside of making the best personal decision, it’s also worth noting that PSLF isn’t guaranteed to be around forever. It’s also notoriously difficult to qualify, so make sure your job is 100% eligible before putting all your eggs in the PSLF basket.
5. Forgiveness from income-driven repayment plans
Amount of time for loan forgiveness: 20 or 25 years
A final option is getting forgiveness from income-driven repayment plans, but you’ll have to be seriously patient. Income-driven plans, such as Income-Based Repayment and Pay As You Earn, require 20 or 25 years of student loan repayment before canceling your remaining balance.
On the plus side, your monthly payments shouldn’t be burdensome, as they’ll be adjusted in accordance with your discretionary income. But you will pay more in interest over the long run since you’ll be stretching repayment out over two decades or more.
This approach could be the right choice if you need a lower monthly payment and don’t see your income rising significantly in the future. But while income-driven repayment plans offer some light at the end of the tunnel, you won’t be seeing loan forgiveness from them very quickly.
How long would you wait for loan forgiveness?
Although loan forgiveness programs can be a huge help, most won’t cancel your student loan debt overnight, and some take a lot longer than others. So before dedicating years to a loan forgiveness program, make sure you’re not sacrificing too much in other areas.
For instance, you might not want to dedicate 10 years of your career to working in public service if PSLF is your only reason for doing so. And income-driven repayment plans might not be worth the loan forgiveness in the end if you want to get out of debt sooner and spend less on interest — in that case, you might be better off refinancing your loans instead.
Make sure to weigh the pros and cons of any loan forgiveness program before committing to it. That way, you can make smart decisions with your student loans while still staying on track toward your other professional and personal goals.
Interested in refinancing student loans?Here are the top 7 lenders of 2019!
|Lender||Variable APR||Eligible Degrees|
|Check out the testimonials and our in-depth reviews!
1 Important Disclosures for Earnest.
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 will qualify for the lowest rate. Approval and interest rate depend on the review of a complete application.
Earnest fixed rate loan rates range from 3.45% APR (with Auto Pay) to 6.99% APR (with Auto Pay). Variable rate loan rates range from 2.05% APR (with Auto Pay) to 6.49% APR (with Auto Pay). For variable rate loans, although the interest rate will vary after you are approved, the interest rate will never exceed 8.95% for loan terms 10 years or less. For loan terms of 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% (the maximum rates for these loans). Earnest variable interest rate loans are based on a publicly available index, the one month London Interbank Offered Rate (LIBOR). Your rate will be calculated each month by adding a margin between 1.82% and 5.50% to the one month LIBOR. The rate will not increase more than once per month. Earnest rate ranges are current as of October 11, 2019, and are subject to change based on market conditions and borrower eligibility.
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.
The information provided on this page is updated as of 10/11/2019. 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 302 2nd Street, Suite 401N, San Francisco, CA 94107. Terms and Conditions apply. Visit https://www.earnest.com/terms-of-service, email us at firstname.lastname@example.org, or call 888-601-2801 for more information on our student loan refinance product.
© 2018 Earnest LLC. All rights reserved. Earnest LLC and its subsidiaries, including Earnest Operations LLC, are not sponsored by or agencies of the United States of America.
2 Important Disclosures for SoFi.
3 Important Disclosures for Laurel Road.
Laurel Road Disclosures
Laurel Road is a brand of KeyBank National Association offering online lending products in all 50 U.S. states, Washington, D.C., and Puerto Rico. Mortgage lending is not offered in Puerto Rico. All loans are provided by KeyBank National Association.
ANNUAL PERCENTAGE RATE (“APR”)
Fixed rate options consist of a range from 3.75% per year to 5.80% per year for a 5-year term, 4.25% per year to 6.25% per year for a 7-year term, 4.55% per year to 6.65% per year for a 10-year term, 4.85% per year to 7.05% per year for a 15-year term, or 5.30% per year to 7.27% per year for a 20-year term, with no origination fees. The fixed interest rate will apply until the loan is paid in full (whether before or after default, and whether before or after the scheduled maturity date of the loan). The monthly payment for a sample $10,000 loan at a range of 3.75% per year to 5.80% per year for a 5-year term would be from $183.04 to $192.40. The monthly payment for a sample $10,000 loan at a range of 4.25% per year to 6.25% per year for a 7-year term would be from $137.84 to $147.29. The monthly payment for a sample $10,000 loan at a range of 4.55% per year to 6.65% per year for a 10-year term would be from $103.88 to $114.31. The monthly payment for a sample $10,000 loan at a range of 4.85% per year to 7.05% per year for a 15-year term would be from $78.30 to $90.16. The monthly payment for a sample $10,000 loan at a range of 5.30% per year to 7.27% per year for a 20-year term would be from $67.66 to $79.16.
However, if the borrower chooses to make monthly payments automatically by electronic funds transfer (EFT) from a bank account, the fixed rate will decrease by 0.25%, and will increase back up to the regular fixed interest rate described in the preceding paragraph if the borrower stops making (or we stop accepting) monthly payments automatically by EFT from the designated borrower’s bank account.
Variable rate options consist of a range from 2.50% per year to 6.30% per year for a 5-year term, 4.00% per year to 6.35% per year for a 7-year term, 4.25% per year to 6.40% per year for a 10-year term, 4.50% per year to 6.65% per year for a 15-year term, or 4.75% per year to 6.90% per year for a 20-year term, with no origination fees. APR is subject to increase after consummation. The variable interest rate will change on the first day of every month (“Change Date”) if the Current Index changes. The variable interest rates are based on a Current Index, which is the 1-month London Interbank Offered Rate (LIBOR) (currency in US dollars), as published on The Wall Street Journal’s website. The variable interest rates and Annual Percentage Rate (APR) will increase or decrease when the 1-month LIBOR index changes. The variable interest rates are calculated by adding a margin ranging from 0.45% to 4.25% for the 5-year term loan, 1.95% to 4.30% for the 7-year term loan, 2.20% to 4.35% for the 10-year term loan, 2.45% to 4.60% for the 15-year term loan, and 2.70% to 4.85% for the 20-year term loan, respectively, to the 1-month LIBOR index published on the 25th day of each month immediately preceding each “Change Date,” as defined above, rounded to two decimal places, with no origination fees. If the 25th day of the month is not a business day or is a US federal holiday, the reference date will be the most recent date preceding the 25th day of the month that is a business day. The monthly payment for a sample $10,000 loan at a range of 2.50% per year to 6.30% per year for a 5-year term would be from $177.47 to $194.73. The monthly payment for a sample $10,000 loan at a range of 4.00% per year to 6.35% per year for a 7-year term would be from $136.69 to $147.77. The monthly payment for a sample $10,000 loan at a range of 4.25% per year to 6.40% per year for a 10-year term would be from $102.44 to $113.04. The monthly payment for a sample $10,000 loan at a range of 4.50% per year to 6.65% per year for a 15-year term would be from $76.50 to $87.94. The monthly payment for a sample $10,000 loan at a range of 4.75% per year to 6.90% per year for a 20-year term would be from $64.62 to $76.93.
However, if the borrower chooses to make monthly payments automatically by electronic funds transfer (EFT) from a bank account, the variable rate will decrease by 0.25%, and will increase back up to the regular variable interest rate described in the preceding paragraph if the borrower stops making (or we stop accepting) monthly payments automatically by EFT from the designated borrower’s bank account.
Borrowers who take out a variable loan with a term of 5, 7, or 10 years will have a maximum interest rate of 9%. Borrowers who take out a 15 or 20-year variable loan will have a maximum interest rate of 10%.
There are no origination fees or prepayment penalties associated with the loan. Lender may assess a late fee if any part of a payment is not received within 15 days of the payment due date. Any late fee assessed shall not exceed 5% of the late payment or $28, whichever is less. A borrower may be charged $20 for any payment (including a check or an electronic payment) that is returned unpaid due to non-sufficient funds (NSF) or a closed account.
For bachelor’s degrees and higher, up to 100% of outstanding private and federal student loans (minimum $5,000) are eligible for refinancing. If you are refinancing greater than $300,000 in student loan debt, Lender may refinance the loans into 2 or more new loans.
ELIGIBILITY & ELIGIBLE LOANS
Borrower, and Co-signer if applicable, must be a U.S. Citizen or Permanent Resident with a valid I-551 card (which must show a minimum of 10 years between “Resident Since” date and “Card Expires” date or has no expiration date); state that they are of at least borrowing age in the state of residence at the time of application; and meet Lender underwriting criteria (including, for example, employment, debt-to-income, disposable income, and credit history requirements).
All loans must be in grace or repayment status and cannot be in default. Borrower must have graduated or be enrolled in good standing in the final term preceding graduation from an accredited Title IV U.S. school and must be employed, or have an eligible offer of employment. Parents looking to refinance loans taken out on behalf of a child should refer to https://www.laurelroad.com/refinance-student-loans/refinance-parent-plus-loans/ for applicable terms and conditions.
For Associates Degrees: Only associates degrees earned in one of the following are eligible for refinancing: Cardiovascular Technologist (CVT); Dental Hygiene; Diagnostic Medical Sonography; EMT/Paramedics; Nuclear Technician; Nursing; Occupational Therapy Assistant; Pharmacy Technician; Physical Therapy Assistant; Radiation Therapy; Radiologic/MRI Technologist; Respiratory Therapy; or Surgical Technologist. To refinance an Associates degree, a borrower must also either be currently enrolled and in the final term of an associate degree program at a Title IV eligible school with an offer of employment in the same field in which they will receive an eligible associate degree OR have graduated from a school that is Title IV eligible with an eligible associate and have been employed, for a minimum of 12 months, in the same field of study of the associate degree earned.
The interest rate you are offered will depend on your credit profile, income, and total debt payments as well as your choice of fixed or variable and choice of term. For applicants who are currently medical or dental residents, your rate offer may also vary depending on whether you have secured employment for after residency.
The repayment of any refinanced student loan will commence (1) immediately after disbursement by us, or (2) after any grace or in-school deferment period, existing prior to refinancing and/or consolidation with us, has expired.
POSTPONING OR REDUCING PAYMENTS
After loan disbursement, if a borrower documents a qualifying economic hardship, we may agree in our discretion to allow for full or partial forbearance of payments for one or more 3-month time periods (not to exceed 12 months in the aggregate during the term of your loan), provided that we receive acceptable documentation (including updating documentation) of the nature and expected duration of the borrower’s economic hardship.
We may agree under certain circumstances to allow a borrower to make $100/month payments for a period of time immediately after loan disbursement if the borrower is employed full-time as an intern, resident, or similar postgraduate trainee at the time of loan disbursement. These payments may not be enough to cover all of the interest that accrues on the loan. Unpaid accrued interest will be added to your loan and monthly payments of principal and interest will begin when the post-graduate training program ends.
We may agree under certain circumstances to allow postponement (deferral) of monthly payments of principal and interest for a period of time immediately following loan disbursement (not to exceed 6 months after the borrower’s graduation with an eligible degree), if the borrower is an eligible student in the borrower’s final term at the time of loan disbursement or graduated less than 6 months before loan disbursement, and has accepted an offer of (or has already begun) full-time employment.
If Lender agrees (in its sole discretion) to postpone or reduce any monthly payment(s) for a period of time, interest on the loan will continue to accrue for each day principal is owed. Although the borrower might not be required to make payments during such a period, the borrower may continue to make payments during such a period. Making payments, or paying some of the interest, will reduce the total amount that will be required to be paid over the life of the loan. Interest not paid during any period when Lender has agreed to postpone or reduce any monthly payment will be added to the principal balance through capitalization (compounding) at the end of such a period, one month before the borrower is required to resume making regular monthly payments.
KEYBANK NATIONAL ASSOCIATION RESERVES THE RIGHT TO MODIFY OR DISCONTINUE PRODUCTS AND BENEFITS AT ANY TIME WITHOUT NOTICE.
This information is current as of October 1, 2019 and is subject to change.
4 Important Disclosures for Splash Financial.
Splash Financial Disclosures
Terms and Conditions apply. Splash reserves the right to modify or discontinue products and benefits at any time without notice. Rates and terms are also subject to change at any time without notice. Offers are subject to credit approval. To qualify, a borrower must be a U.S. citizen or permanent resident in an eligible state and meet applicable underwriting requirements. Not all borrowers receive the lowest rate. Lowest rates are reserved for the highest qualified borrowers.
5 Important Disclosures for CommonBond.
Offered terms are subject to change. Loans are offered by CommonBond Lending, LLC (NMLS # 1175900). If you are approved for a loan, the interest rate offered will depend on your credit profile, your application, the loan term selected and will be within the ranges of rates shown. All Annual Percentage Rates (APRs) displayed assume borrowers enroll in auto pay and account for the 0.25% reduction in interest rate. All variable rates are based on a 1-month LIBOR assumption of 2.05% effective September 10, 2019.
6 Important Disclosures for LendKey.
Refinancing via LendKey.com is only available for applicants with qualified private education loans from an eligible institution. Loans that were used for exam preparation classes, including, but not limited to, loans for LSAT, MCAT, GMAT, and GRE preparation, are not eligible for refinancing with a lender via LendKey.com. If you currently have any of these exam preparation loans, you should not include them in an application to refinance your student loans on this website. Applicants must be either U.S. citizens or Permanent Residents in an eligible state to qualify for a loan. Certain membership requirements (including the opening of a share account and any applicable association fees in connection with membership) may apply in the event that an applicant wishes to accept a loan offer from a credit union lender. Lenders participating on LendKey.com reserve the right to modify or discontinue the products, terms, and benefits offered on this website at any time without notice. LendKey Technologies, Inc. is not affiliated with, nor does it endorse, any educational institution.
7 Important Disclosures for College Ave.
College Ave Disclosures
College Ave Student Loans products are made available through either Firstrust 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.
1College Ave Refi Education loans are not currently available to residents of Maine.
2All rates shown include autopay discount. The 0.25% auto-pay interest rate reduction applies as long as a valid bank account is designated for required monthly payments. Variable rates may increase after consummation.
3$5,000 is the minimum requirement to refinance. The maximum loan amount is $300,000 for those with medical, dental, pharmacy or veterinary doctorate degrees, and $150,000 for all other undergraduate or graduate degrees.
4This informational repayment example uses typical loan terms for a refi borrower with a Full Principal & Interest Repayment and 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.
Information advertised valid as of 09/23/2019. Variable interest rates may increase after consummation.
|2.05% – 6.49%1||Undergrad & Graduate|
|2.05% – 5.98%2||Undergrad & Graduate|
|2.25% – 6.65%3||Undergrad & Graduate|
|2.43% – 7.60%4||Undergrad & Graduate|
|2.14% – 7.21%5||Undergrad & Graduate|
|2.01% – 8.88%6||Undergrad & Graduate|
|2.74% – 6.24%7||Undergrad & Graduate|