Student loan forgiveness programs: 10 options and how to qualify

As of 2023, nearly 44 million adults hold federal student loans in the U.S. These federal loans constitute over 93% of the nation’s $1.766 trillion in student loan debt, with an average balance of federal debt $37,338 per borrower (plus an average of $54,921 in private student loan debt).

Given that these average balances are so high, it’s unsurprising that many borrowers struggle with repayment. Fortunately, the federal government offers certain programs that can provide relief, apart from the Biden Administration’s efforts to provide student loan relief. 

Here’s what to know about student loan forgiveness programs and how to qualify. 

What is student loan forgiveness?

When your student loans are forgiven, a portion or all of your debt is eliminated, and you’re no longer obligated to pay that amount. If you have federal loans, the U.S. government offers multiple options for federal student loan forgiveness. 

How student loan forgiveness works

Generally, you’ll need to work in a specific field for a set number of years to qualify for federal student loan forgiveness. For instance, certain organizations and federal programs offer student loan forgiveness for those who work in public service or as teachers, health professionals and attorneys. 

Certain government employees and U.S. military members could also be eligible for student loan forgiveness. 

5 federal student loan forgiveness programs

Public Service Loan Forgiveness

Public Service Loan Forgiveness (PSLF) is available through the U.S. Department of Education for federal Direct Loan borrowers. You might also qualify for this option if you have Federal Family Education Loan (FFEL) Program loans or Perkins Loans that have been rolled into a Direct Consolidation Loan. 

Under this program, borrowers working for eligible employers can have the remainder of their federal student loans forgiven after making 120 qualifying monthly payments. Keep in mind that PSLF is employer-based, not role-based, so you don’t necessarily need to be a police officer, firefighter, teacher or similar to qualify. You can determine if you work for an eligible employer by using the Federal Student Aid’s employer eligibility tool. 

• Forgiveness amount: Varies based on amount borrowed and repaid. 
• Qualifications: Work full-time for a qualifying employer, certify your employment annually and make 120 qualifying loan payments. 
• Taxable/not taxable: Not taxable.

Teacher Loan Forgiveness Program

The Teacher Loan Forgiveness (TLF) Program offers up to $17,500 in student loan forgiveness to teachers with Direct or FFEL program loans who teach full time for five consecutive years at an eligible school or organization that serves low-income students. Eligible schools include elementary and secondary schools or educational service organizations.

• Forgiveness amount: Up to $17,500.
• Qualifications: Be a state-certified teacher with a bachelor’s degree without having certification or licensure requirements waived on certain bases (also referred to as being a “highly qualified teacher”) and work five years teaching full-time at a qualifying school. 
• Taxable/not taxable: Not taxable.

Health professional loan repayment

If you work in a qualifying healthcare role, you could qualify for student loan assistance through organizations like the National Health Service Corps (NHSC) or the National Institutes of Health (NIH). The NHSC offers up to $120,000 in loan assistance for qualifying full-time healthcare professionals, while the NIH offers up to $50,000 per year to healthcare professionals conducting qualified research. Eligible nurses might also qualify for an up to 60% loan payoff through the Nurse Corps loan repayment program in return for a two-year service commitment.

• Repayment amount: Up to $120,000 or up to 60% of loans, depending on the program.
• Qualifications: Licensed healthcare professionals working in qualifying roles.
• Taxable/not taxable: NHSC payments aren’t taxable, but NIH and Nurse Corps repayments are taxable.

Service member loan repayment

While members of the U.S. military could qualify for PSLF, several other student loan assistance programs also exist for service members. For instance, the U.S. Army offers a special program that will repay up to $65,000 in student loans for qualifying members, while the Coast Guard provides up to $60,000 in assistance. Other branches also offer student loan repayment programs. 

• Repayment amount: Varies by program.
• Qualifications: Varies by program.
• Taxable/not taxable: Payments can be taxable, depending on the program.

Income-driven repayment

The U.S. Department of Education offers four income-driven repayment (IDR) programs for qualifying federal loan borrowers, which can be a good option if you aren’t eligible for other forgiveness programs. 

IDR plans base your payments on your income, which can significantly reduce your monthly payments. Additionally, you could have your remaining balance forgiven after making 20 or 25 years of qualifying payments, depending on the plan.

Here are the four main IDR plans available:

• Repayment amount: Amount remaining after 20 or 25 years of payments, depending on the plan.
• Qualifications: Varies by plan.
• Taxable/not taxable: Taxable.

Student loan forgiveness vs. discharge

While student loan forgiveness and discharge can accomplish the same goal, the path to achieving it is typically different. In most cases, you can apply for student loan forgiveness after several years of service in a qualifying role. 

To qualify for student loan discharge, on the other hand, you typically don’t need to work in a specific role for a set number of years. Note that this doesn’t apply to Perkins Loan cancellation. 

5 federal student loan discharge programs

Perkins Loan cancellation

Federal Perkins Loans are no longer issued. But if you have a Perkins Loan that was disbursed before June 30, 2018, your loan might be eligible for cancellation. You could have up to 100% of your Perkins Loan canceled if you’ve worked full time in a qualifying profession or served in the military in a hostile fire or imminent danger pay area. Most of these programs require five years of service. 

• Cancellation amount: Up to 100% (up to 50% for military members whose active duty service ended before Aug. 14, 2008).
• Qualifications: Varies by profession.
• Taxable/not taxable: Not taxable.

Closed school discharge

If your school closes while you’re attending or shortly after you graduate, you could qualify for a federal student loan discharge of up to 100%. Qualifying loans include Direct Loans, FFEL Program Loans and Perkins Loans. 

• Cancellation amount: Up to 100%.
• Qualifications: Attend a school that closes while you’re enrolled or soon after you withdraw.
• Taxable/not taxable: Not taxable.

Borrower defense loan discharge

Students defrauded by their schools could be eligible for a borrower defense loan discharge. Under this program, borrowers can qualify for a federal loan discharge of up to 100%. 

• Cancellation amount: Up to 100%.
• Qualifications: Be enrolled in or continue to attend a school based on misleading information from the school or other misconduct that caused you harm. 
• Taxable/not taxable: Not taxable.

Discharge due to permanent disability or death

If a borrower has a permanent disability or passes away, their federal student loans could qualify for discharge. Likewise, if a parent has borrowed on behalf of a borrower who passes away, those loans could also be discharged. 

• Cancellation amount: 100%.
• Qualifications: Become totally and permanently disabled or die.
• Taxable/not taxable: Not taxable if received between Jan. 1, 2018, and Dec. 31, 2025 (could be taxable afterward).

Discharge due to bankruptcy 

While it can be difficult to discharge your federal student loans in bankruptcy, it’s possible in some cases. Originally, borrowers have needed to prove through an adversary preceding in bankruptcy court that repaying their student loans would result in significant financial hardship for an extended time. However, in November 2022, the Department of Education and Department of Justice released new guidance to make the bankruptcy discharge process for student loans fairer and more accessible to borrowers. 

These new guidelines have allowed borrowers to qualify for federal student loan discharge based on their individual circumstances and without having to go through the full process of an adversary proceeding. As of Nov. 16, 2023, 99% of borrowers pursuing student loan discharge through bankruptcy received a full or partial discharge under the new guidance, according to the Department of Justice.  

• Cancellation amount: Up to 100% (could also be required to repay your loan with different terms).
• Qualifications: Demonstrate in bankruptcy court that repaying your loan would cause undue hardship (or demonstrate extenuating circumstances that show an undue hardship, which doesn’t require an adversary proceeding).
• Taxable/not taxable: Not taxable.

Do private student loans qualify for forgiveness?

Unfortunately, private student loans don’t qualify for cancellation outside of rare situations, such as discharge due to the death of the primary borrower if permitted by the lender.  

“Private student loans aren’t eligible for federal forgiveness programs,” says Leslie Tayne, financial attorney and founder of Tayne Law Group, a debt relief firm. “And private lenders rarely — if ever — forgive student loan debt held by their borrowers.” 

That said, if you’re unable to make your private loan payments, your lender may be willing to temporarily pause your payments or modify them. 

Tip: If you’re struggling to manage private loans, you’ll need to look into other alternatives outside of forgiveness. For example, if you have good credit, you might be able to get a lower interest rate by refinancing your student loans, which could save you money on your total interest costs and possibly speed up your repayment timeline.

Watch out for student loan forgiveness scams

If a company reaches out claiming that it can help cancel your student loan debt for a fee, be wary. Federal Student Aid warns that scams are often tied to current events, like Biden’s student loan forgiveness plan that was struck down by the Supreme Court — though this isn’t always the case. 

Scammers might ask for money upfront, claiming that they can help you discharge your student loans. This is a major red flag, and if you get a call, email or text message from a company that’s aggressively advertising this service for a fee, submit a complaint to the Federal Student Aid Office. 

Alternatives to student loan forgiveness

Deferment or forbearance

If you’re facing financial hardship, your federal student loans could be eligible for deferment or forbearance. Both let you pause your loan payments temporarily, but there’s a key difference between the two: Interest won’t accrue during deferment if you have a Direct Subsidized Loan or Direct Subsidized Consolidation Loan, but it will accrue on any type of loan in forbearance.  

Loan assistance programs

State-based student loan assistance programs might also be available, depending on where you live and your job. Under these programs, certain employees could qualify for financial assistance if they work in qualifying roles. 

Tip: Review your state’s Department of Education website to determine what’s available in your area.

Employer assistance

Loan assistance might also be available through your current or prospective employer. It’s becoming more common for companies to offer this benefit in an effort to attract new graduates. Plus, employer loan assistance might not be taxable. 

Under the CARES Act, employers can provide up to $5,250 each year toward employee student loans until 2025, and the repayments aren’t counted as taxable income for employees.  

Private refinancing

Refinancing your student loans could be another option, though it’s crucial to weigh the pros and cons if you have federal student loans. While it’s possible to refinance both private and federal loans with private lenders, refinancing federal loans with a private lender means losing federal benefits and protections, like access to loan forgiveness programs and IDR plans. 

Still, refinancing could make sense if it will provide a significantly lower interest rate or monthly payment. This in turn can potentially reduce your total interest costs over your loan’s term and help make your payments easier to manage. Keep in mind that you’ll typically need good to excellent credit to qualify for the lowest rates available on refinanced loans.

Looking to refinance? Here are the best lenders for student loan refinancing

Federal consolidation

You could also consider consolidating your federal loans into a new Direct Consolidation Loan so you won’t lose your federal benefits. Unlike private refinancing, federal consolidation doesn’t change your interest rate. Instead, your rate will simply be the weighted average of the interest rates on the loans being consolidated, rounded up to the nearest one-eighth of 1%.

However, consolidation will allow you to extend your repayment term up to 30 years, which could significantly reduce your monthly payments. Just remember that a longer term means paying more in interest over time.