Money Smarts Blog
3 reasons you (probably) won't get out of repaying your student loans
Jan 24, 2018 || Amanda Spurgeon
Student loans: the burden facing about 40 million Americans, with no end in sight. We all wish there was some quick, easy way to get out of repaying student loans. But no matter how many scam letters you get in the mail about “qualifying for loan forgiveness,” you’re probably going to have to pay them all back. It’s a bummer, right?
The good news is that there are some legitimate student loan forgiveness programs out there. The bad news is that you probably don’t qualify for them, for three simple reasons:
- You might not have the right kind of loan
Despite what you might have heard on the radio or elsewhere, the only legitimate student loan forgiveness programs are provided by the U.S. government and applying to them is free.
These programs are only good for federal student loans, so if you’re packing private loans you aren’t eligible for loan forgiveness from the U.S. government.
- You could have the wrong payment plan
One way to have your federal student loans forgiven is through certain income-based repayment plans, so if you’ve been making the standard payment this option isn’t for you. These plans cap your payments at a certain percentage of your income; if your loans aren’t paid in full after 20 or 25 years (depending on your plan) you could be eligible for forgiveness.
Learn more about income-based repayment plans for federal loans.
- You aren’t working in the right field
If you’re a teacher, employee of 501(c)(3) nonprofit, public service worker or government employee you may qualify for Public Service Loan Forgiveness after 10 years. If your work wouldn’t be considered public service and you have a for-profit employer, you probably don’t qualify.
Learn more about Public Service Loan Forgiveness.
If reading this list helped you find a way to eventually have your loans forgiven, I offer you my most sincere congratulations. If, like me, you’ve discovered that you will definitely have to pay back every single penny you borrowed without exception, you have my sympathy.
If you’re seeking loan forgiveness because you’re struggling to repay your loans, you might benefit from a consolidation loan. Check out this infographic to help you find out if student loan consolidation is right for you.
Ready to talk to someone about getting those payments under control? IHMVCU offers consolidation loans for student debt. Hooray!