Most people are aware that discharging a student loan in bankruptcy is difficult. However, in certain circumstances, you may still be able to eliminate your federal student loan debt by obtaining loan forgiveness or administrative (non-bankruptcy) discharge.
There are a variety of ways to obtain loan forgiveness or administrative discharge. Each of these options will be discussed further in future blogs, so be sure to check back with us. Some of the primary ways to have your federal student loan forgiven or discharged are:
- Teacher Loan Forgiveness. If your federal student loans were disbursed after 1998 and you teach full-time in an eligible elementary or secondary school for five consecutive years, you may be able to have as much as $17,500 of your federal student loans forgiven.
- Public Service Loan Forgiveness. If you are employed in certain public service jobs and have made 120 payments on your federal direct loans (including consolidated loans), the remaining balance that you owe may be forgiven – tax free!
- Total and Permanent Disability (“TPD”) Discharge. If you are totally and permanently disabled, you may be able to obtain a TPD discharge, eliminating your liability to repay certain federal student loans.
- Closed School Discharge. If you are unable to complete your program because your school closes while you are enrolled or your school closes within 90 days after you withdraw from it, you may be eligible to discharge your federal loans obtained to attend that school.
- False Certification of Student Eligibility. There are certain circumstances where a school may mislead you or otherwise falsify certification of your eligibility for a program that can result in your student loans being discharged. For example, if your school signed your name on the student loan application or promissory note without your authorization. Cases of identity theft may also qualify.
- Unpaid Refund Discharge. If you withdrew from school and your school failed to pay the refund it owed to your lender or the U.S. Department of Education, you may be eligible to discharge the amount of the unpaid refund.
- Death. The death of a student discharges a parent’s obligation on a Parent PLUS loan.
Please keep in mind that every student loan matter is different. If you have questions about your student loans or if you like to know if your federal student loans qualify for forgiveness or discharge, and you would like to schedule a no-cost consultation, please contact our office by completing the form on this website or calling us at (954) 280-5066.