Cancel Student Loan Debt for College Graduates

I’m certain that many of you face student debt out there still after years of attempting to pay it off or maybe you are simply starting to pay off those loans out of school. Whatever the case is, many of you might want to take care of that cancel student loan debt as soon as possible.One alternative that the government gives is through student loan forgiveness. These are great ways for you to provide for Uncle Sam or some open assistance that is required and as a trade-off for your time and gifted help they are caring enough to take care of a few or all of your student loans.

Many of you face law school debt and that is practically a mortgage with the amount you have to dish out for a couple of years of reading books and losing rest. Some of you may imagine that you will get recruited by some great law firm and all that will be taken care of and that may happen, however for many of you that won’t be an option.Another thing to take a gander at is working for a non-benefit or public interest organization. This can help you take care of some genuinely necessary debt and give yourself a serviceable name in your industry. It probably won’t be glamorous, yet it is a decent way to take care of all of the debt that will eat at your bank account for quite a long time.

Student debt has become a major problem in the U.S concerning more than 40 million people. Every student accrues debt hoping that better education will lead to a better future. However, most of them struggle to meet the loan obligations after graduation. Whether it is a private or federal loan, debt repayment can take several years and require constant income inflow.

Yet, luckily, there are some options to ease the debt repayment process. Programs exist that can help borrowers to reduce or cancel the debt obligations. These opportunities are mostly available to federal borrowers, while private debtors can access a few options.

This guide will introduce 12 ways to cancel student loan debt, covering different types of qualifications.

Want to Cancel Student Loan Debt? Read This Before
Before discussing your options for federal and private loans, keep in mind that finding the right program is not a piece of cake. While getting familiar with the options, you will notice that each of them has specific eligibility conditions, benefits, and drawbacks. As much as ‘debt cancellation’ sounds attractive, sometimes repaying the debt can even be more effective than applying to forgiveness programs.

Borrowers need to be well aware of the accessible options and thoroughly analyze their finances before selecting a program to apply to. We understand that many borrowers do not have the necessary financial backgrounds or even enough time to think twice about forgiveness alternatives.

Therefore, it is highly recommended that the borrowers get expert help in this demanding path. Like those we work with in Student Loans Resolved; our debt specialists have years of experience. They have resolved the student loan problems of hundreds of similar borrowers. Their expertise is what allows them to choose the most suitable program for you. Before wasting your time on wrong options, make sure you get expert advice.

Federal Debt Cancellation Programs
We will start our guide by describing solutions to eliminate the federal debt. As mentioned, if you have a federal loan, you have multiple cancellation options to consider. Some of them require a mandatory service in return, while others depend on specific conditions. It is also possible to get rid of the debt if the school misled you.

Besides these programs that can cancel student loan debt fully or partially, some opportunities can ease the repayment process. These alternatives will not forgive any debt, but at least borrowers will get more favorable terms to pay back the debt.

1. Public Service Loan Forgiveness
public service loans
When it comes to federal loan cancellation, the Public Service Loan Forgiveness is the star of the show. There are several forgiveness programs offered for federal borrowers, but the PSLF is one of the most suitable ones for many borrowers.

In general, it takes around 10 years to access this debt cancellation option. The process is simple; once the debtor makes 120 payments, the rest of the debt is eliminated. However, there are still extensive eligibility conditions. If you want to cancel student loan debt through this program, make sure you get familiar with the eligibility criteria beforehand.

Eligibility Requirements for cancelling student loan debt
One of the main reasons for failure while applying for forgiveness is wrong documentation and inability to meet eligibility criteria. Therefore, applicants should be cautious about their qualifications. Even if they attempt to meet the required conditions, wrong documentation or lack of documents can be a barrier to cancel student loan debt.

Sure, such great benefit that the PSLF brings is not achieved easily. The borrowers need to focus on many different factors regarding their work conditions, workplace, loan type, etc.

Some of the general eligibility conditions are straightforward to understand. For example, it should be no surprise that the borrowers need to work in the public sector or in a non-profit organization to cancel student loan debt through the PSLF.

However, other conditions need more elaboration. In general, the debtor should serve full-time, own a direct loan and repay it 120 times under a qualifying repayment plan. Besides, the 120 payments have their own eligibility criteria. In the following sections, we will explain more details about these requirements.

1. Workplace
Any government, state, tribal, or local organization qualifies for this program. Besides, borrowers can work in a not-for-profit, tax-exempt organization. The service that the borrower provides has its own conditions. First, it should be full time. Full time can be defined as a minimum of 30 hours weekly. Many organizations have their own full-time service determination methods, but keep in mind that working less than 30 hours per week is not acceptable.

The good news is that even debtors with part-time work can apply this forgiveness opportunity. However, in this case, they need to have several half-time positions so that the total of work hours can sum up to a minimum of 30 hours.

Additionally, it is important to note that some type of work in a qualifying organization might not be counted for the program. For example, in religious organizations, time spent worshipping might not be a part of the minimum 30 hours work requirement.

2. Debt
The debt that the borrower owes also defines whether he/she is eligible to cancel a student loan or not. As mentioned before, only federal direct loans qualify for this program. Unfortunately, if you have FFEL, Perkins, or private loans, you cannot apply to the PSLF. But do not get disappointed; we will still talk about many other programs to cancel student loan debt.

Some borrowers consolidate their multiple loans into one to make the repayment process easier. Keep in mind that if you decide to consolidate, your points acquired for PSLF- qualifying payments made- would be lost. In other words, only the payments after consolidation will be counted.

3. Payment
Under the debt categorization, there are specific conditions about the payment, too. All borrowers have to make 120 payments to qualify for forgiveness. As a result, the remaining debt will be forgiven. The advantage of this condition is that the payments do not need to be consecutive. For example, if you have made 10 payments before losing your job, you will not lose the 10 credits gained after finding a new position and continuing to make the process. Another implication of this requirement is that the borrowers will receive the forgiveness in more than 10 years, in case there were periods of non-qualifying payments.

Another simple payment requirement is that it should be made in full the amount shown in the bill, on time and after October 2007. On-time means the borrower has a maximum of 15 days after the due date. Again, while repaying the debt, the borrower should meet other categories of eligibility criteria, such as having a qualifying employer and work hours.

Please, note that you cannot earn 120 points for payments faster by paying more. Imagine you made 3-month worth of payments ahead. In this case, you earn 3 credits for the progress toward 120. But the only advantage this approach brings is that you will not be required to repay the debt for the next two months.

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