July 20, 2021

What Qualifies You For Student Loan Forgiveness?


Student loans are a cost that many Americans carry throughout their adulthood. Over $40 million Americans owe an average of $40,000. Many attest to the difficulty of paying the loans off with the ups and downs of their life. However, the government has given the option for student loan forgiveness. To claim forgiveness, you’d have to qualify for it first.

Student Loan Forgiveness Qualification

If you qualify for student loan forgiveness, the government can release you from the obligation of paying the debt. You can get forgiven completely, or partly. There are two main ways to qualify for forgiveness:

  1. Working in public service
  2. Agreement to a payment plan based on your income

Public Service

The government has the Public Service Loan Forgiveness Program or PSLF. It is only available for those who’ve worked in the government or for a nonprofit organization. You can also qualify for it if you’ve served in the following:

  • Military
  • Medical
  • Volunteer work
  • Social work
  • Police department
  • Fire department

To qualify, you first must have made 120 qualifying payments. It means that you have paid the minimum at least 120 times as a part of the government or nonprofit organization. In other terms, you've been on the job for at least ten years, making monthly payments consistently. You also only qualified for it if you made a federal government student loan (William D. Ford).

If you don’t have a William D. Ford loan, you must first merge the debt into another federal loan eligible for forgiveness. For example, a Perkins Loan or an FFEL must consolidate into another loan. Note that the qualifying payments only start counting after the consolidation.

Payment Plan

If you’re not in public service, you’ll need to join a federal income-driven repayment plan. You can apply for this if you feel unable to pay off the debt within a 10-year timeframe. The plans include:

  • Income-Based Repayment or IBR: Monthly payments amounting to 10-15% of discretionary income. You’ll have to maintain this plan for 25 years.
  • Pay as you earn or PAYE: Maximum monthly payments of 10% of discretionary income. You’ll have to maintain the plan for 20 years.
  • Income Contingent Repayment (ICR): Payments depend on your balance, gross income, and family size. They usually amount to 20% of discretionary income, and you have to pay after 25 years.

Things To Consider

While income-based repayment is a path to forgiveness, it can also stretch your finances thin for a long time. You can opt for an extended or graduated repayment plan instead. These only extend the time you need to pay off the debt and not commit you to decades of payments.

Another thing to consider is that the government is working on student loan forgiveness. While there has yet to be finalization, you could experience at least $10,000 forgiveness.

Use Chipper for Lower Payments

Chipper can help you find a student loan repayment plan that actually fits into your budget. You simply fill out your information and link your student loan account for us to generate your options in seconds. We help the average student loan borrower save over $300 a month off their student loan monthly payment. Lowering your monthly payment plan can game changing for your personal finance and can be done in minutes! Sign up for Chipper today to get on track with your student loans.

Use Chipper for The Best Path to Forgiveness

Finding your path to student loan forgiveness is easier than ever before. Chipper helps members find better Income-Driven Repayment (IDR) plans every day. Once enrolled in an eligible repayment plan, we can help you explore your forgiveness options and understand your path towards forgiveness. Sign up with Chipper today and get on track with your student loans.

Use Chipper for Round-Ups

Paying off your student loans doesn’t have to be a long and painful journey. Round-Ups are a way to directly pay off your loans with your everyday spending! By tracking your linked spending account(s), we will calculate the rounded up amount from each transaction in a week (IE spending $4.28 would add $0.72 to the weekly amount). We then initiate a payment towards your student loan for the weekly amount. Get chipping away on your student loans with Chipper today.

Use Chipper for Public Service Loan Forgiveness (PSLF)

The Public Service Loan Forgiveness (PSLF) program was created to provide relief to borrowers aiding the public sector. Unfortunately, 30% of applicants are denied due to incorrect paperwork. We can help! Chipper was created to solve this issue by assisting borrowers in understanding their options as well as allowing forgiveness eligible users enroll into the best forgiveness program available. Sign up for Chipper today to see your student loan forgiveness options and get the forgiveness you deserve.

Use Chipper for Teacher Loan Forgiveness (TLF)

The Teacher Loan Forgiveness (TLF) program was created to enable teachers working in Title 1 schools to receive student loan forgiveness of up to $17,500 (depending on their teaching subject). Chipper has helped teachers from all over the country qualify for TLF program and can help you get the forgiveness you deserve today. Find out if you qualify for forgiveness in minutes with our employer search tool.

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