A loan discharge releases you from all or a portion of your student loan debt obligation. In certain circumstances, if you have loans through the Federal Family Education Loan Program (FFELP), the Direct Loan program (DL) or, in some cases, the federal Perkins loan program, you may be eligible for a federal student loan discharge.
There are several circumstances in which your federal student loan debt may be discharged or forgiven:
Teacher Loan Forgiveness encourages entering and continuing in the teaching profession by forgiving a portion of student loans after 5 years of teaching (or sooner, for Perkins loans).
In order to qualify for Teacher Loan Forgiveness:
You must have been teaching full time for 5 consecutive years at an eligible low-income school or eligible location operated by an educational service agency. For a list of eligible schools, check the U.S. Department of Education’s Teacher Cancellation Low Income Directory.
If you meet the above criteria, you may be eligible for this forgiveness depending on when you began teaching and the type of teaching you do. Any loan you are looking to have forgiven must be made before you complete your 5 years of qualifying teaching service.
You may be eligible for forgiveness of up to $5,000 if:
You may be eligible for forgiveness of up to $17,500 if:
You may be eligible for forgiveness of either:
Note that you can combine your full-time service at qualifying elementary and secondary schools to meet the 5-year requirement period.
If you think you qualify, fill out a Teacher Loan Forgiveness Application (pdf, 0.08 MB), then contact your servicer.
You may also wish to use Teacher Loan Forgiveness Forbearance (pdf, 0.09 MB), which lets you postpone payments while you are completing the teaching requirement.
If you have Perkins loans and meet the state requirements, you may qualify for the following:
You may also qualify for a deferment during this 5-year time period. To find out if you meet the requirements for Teacher Loan Forgiveness, contact the school that holds your loan.
If you work for certain public service or nonprofit employers, you may be eligible to have your remaining balance forgiven.
Public Service Loan Forgiveness encourages public service careers by forgiving the balance of borrowers’ loans after they make 120 qualifying payments in no less than 10 years.
Qualifications for this program include the following:
Keep in mind, the standard repayment schedule works by splitting your loan amount into 120 equal payments (or 12 payments per year for 10 years). So, after making 120 payments, you may not have a balance left to be forgiven unless you are making reduced payments under one of the income-driven repayment plans. If you qualify for forgiveness, the forgiven balance is not taxable.
Only non-defaulted loans made under DL are eligible for Public Service Loan Forgiveness. DL loans include the following:
Payments you have made under FFELP are not eligible. If you have FFELP loans, you can gain eligibility by consolidating your loans into DL.
If you (or the student in the case of a Parent PLUS loan) die, the federal student loan will be discharged.
To apply, send notification of death to the loan holder. Collection activity will be put on hold for 60 days after the loan holder receives notification of the death. An original or certified copy of the death certificate (or a photocopy) must be sent to all of the borrower’s loan holders to discharge the loan(s). Perkins loans are also eligible for this discharge.
Student loans are difficult to discharge through bankruptcy, but it can be done.
In some circumstances you may be eligible for a federal student loan discharge if you file for bankruptcy. The bankruptcy court would have to rule that repaying your federal student loan debt would cause you an undue hardship.
Perkins loans are also eligible for this discharge. To apply, contact a qualified bankruptcy attorney and, once filed, provide all loan holders with the Notice of First Meeting of Creditors. The loan will be placed on hold until the bankruptcy proceedings have concluded.
If you (or the student in the case of a Parent PLUS loan) could not complete your program of study because your school closed while you attended or you withdrew within 120 days of the school closing, your federal student loans may be eligible to be discharged.
This is only available for loans received on or after January 1, 1986.
In addition, the entire school or location must close. You would not be eligible if the school terminated your program. You would not be eligible for a school closure discharge if you continue a similar program of study at another school through a teach-out program, by transferring your credits from the closed school to another school, or by benefiting from the training provided by the closed school.
You can find a list of all closed schools here with further guidance on your options.
Perkins loans are also eligible for this discharge. To apply, complete the School Closure Loan Discharge Application (pdf, 0.06 MB) and submit it to your loan holder.
If your school admitted you even though you did not meet the requirements of admission and you did not have the ability to benefit from its training, you (or the student in the case of a Parent PLUS loan) may be eligible for a loan discharge.
For example, if you had not received a high school diploma or GED before your admission and receipt of federal aid, you might qualify for this discharge. Loans made before January 1, 1986 and all Perkins loans are ineligible for this discharge.
To apply, complete the False Certification of Ability to Benefit Loan Discharge Application (pdf, 0.06 MB) and submit it to your loan holder.
If you (or the student in the case of a Parent PLUS loan) were unable to meet the state’s legal requirements for employment in the occupation in which you studied at the time you received your federal student loans, you may be eligible for a loan discharge.
Loans made prior to January 1, 1986 and all Perkins loans are ineligible for this discharge. To apply, complete the False Certification Disqualifying Status Form (pdf, 0.06 MB) and submit it to your loan holder. You must provide the loan holder your state’s legal requirements for employment that you could not meet, as well as documentation proving that you had this disqualifying status when you received your loan.
If your school falsely signed your name to take out student loans, or if another person borrowed in your name without your knowledge and without benefitting you, you could be eligible for these programs.
If your (or the student’s in the case of a Parent PLUS loan) school falsely signed your name on the loan application or promissory note without your permission, you may be eligible for a loan discharge. Such a request for discharge may be denied if you received benefit or use of the proceeds of the loan.
Perkins loans and all loans made prior to January 1, 1986 are excluded from this discharge.
To apply, complete the False Certification: Unauthorized Signature form (pdf, 0.06 MB) and submit it to your loan holder.
If you are a victim of identity theft and someone was convicted of borrowing a federal student loan under your name, you may be eligible to have the loan discharged.
To apply, complete the same False Certification Unauthorized Signature Form (pdf, 0.06 MB) and submit it to your loan holder. You must certify that you did not authorize the loan, willingly receive or benefit from the loan, and provide the loan holder a copy of the court verdict or judgment stating that you were the victim of identity theft by the person named.
Perkins loans and all loans made before January 1, 2006 are ineligible for this discharge.
You (or the student in the case of a Parent PLUS loan) may be eligible to have a portion or all of your federal student loan discharged if your school did not make a required return of your loan funds to your loan holder.
This discharge is not available for Perkins loans or loans made before January 1, 1986. The discharge would only be for the amount that should have been returned and was not.
To apply, complete the Unpaid Refund Loan Discharge Application pdf, 0.1 MB) and submit it to your loan holder. You may need to provide proof showing that your loan should have been refunded to your loan holder.
In addition to the Teacher Loan Forgiveness benefits listed above, Perkins loan borrowers may be able to have a portion or their entire loan balance forgiven if they work in one of these categories:
Perkins loans generally get cancellations; a portion of the loan and interest are forgiven for each year you are eligible. In order to qualify for cancellation, you must apply as soon as you are eligible. If you were eligible in the past but did not apply, that portion of your debt cannot be canceled. To apply, contact your school.
If you believe there is a problem with your loan or dispute the information provided by your loan holder and you have tried to resolve the dispute but are still not satisfied, you may need to contact the Federal Student Aid (FSA) Ombudsman of the US Department of Education. The Ombudsman group is a neutral, informal, and confidential resource to help resolve disputes about your federal student loans. You should only contact the Ombudsman as a last resort.
The Ombudsman can help you:
They do not:
You can contact the Ombudsman group at 877.557.2575 or by fax at 202.275.0549. You can also mail complaints to:
US Department of Education
FSA Ombudsman Group
830 First Street, N.E., Mail Stop 5144
Washington DC, 20202-5144
Not sure who to contact about your eligibility for a discharge? Start with ASA. Our Borrower Advocacy team specializes in dispute resolution. Also, when needed, our VP-level ombudsman can personally work with you to resolve difficulties surrounding your loan.
If you’re unable to work due to injury or illness, you may be eligible to have your federal student loans discharged. If eligible, this means you wouldn’t be responsible for any further payments.
There are 3 ways to qualify for total and permanent disability discharge:
Note: The third item applies only to applications filed on or after July 1, 2013.
All federal Stafford, PLUS, Perkins, and Consolidation loans are eligible. Your loan responsibility if you are a co-signer or endorser on any PLUS or Consolidation loans would be dischargeable as well. To apply, go to DisabilityDischarge.com. The site has additional information about how to fill out this form and how the discharge process works.
Once you begin the application process, you will automatically be placed in forbearance for 120 days. During that time, no payments are due.
If your doctor is certifying your application, your doctor will have to fill out Section 4 of the form. Once your doctor has filled out Section 4, you must finish submitting the form within 90 days.
If you are a disabled veteran or receive SSA benefits, you can provide a copy of your VA disability paperwork or SSA award instead of the doctor’s portion of this form. You still need to fill out the other parts, though.
Be sure you fill the form out carefully and completely, because it cannot be processed if it is not complete.
Once you and/or your doctor have completed the form, submit it to:
US Department of Education
PO Box 87130
Lincoln, NE 68501
Your application will be handled by Nelnet, which has been designated to process all TPD applications. No payments are due while the application is being reviewed.
If you qualify by doctor certification or SSA award, you will be placed in a three year post-monitoring period after your application is approved. Your loan can be reinstated during this period if you:
Veteran applicants don’t have a post-monitoring period.
Q. I applied for TPD discharge before July 1, 2013 but haven’t heard back yet. Who should I contact?
A. Applications received prior to July 1, 2013 will be reviewed and processed by the loan holder, which could be your lender or guaranty agency or Direct Loan servicer. For updates, you should contact whomever you sent your TPD application to initially.
Q. I applied for TPD discharge in the past but was denied. Can I apply again now that Social Security Disability is considered a qualifying status?
A. Yes. Borrowers may reapply for TPD discharge anytime new information becomes available about their disability. New regulations allowing TPD discharge due to some SS disability status’ falls in this category.
Q. Where do I obtain a TPD application?
If you live in a federally declared disaster area, you may be eligible for relief that would temporarily suspend your federal student loan payments.
To see if your area has been declared as a disaster area, check the Federal Emergency Management Agency’s website.
For non-defaulted borrowers, both Direct Loans and Federal Family Education Loans will grant a three-month administrative forbearance and provide you a notice allowing you to decline the forbearance if you were not affected by the disaster. You do not need to notify the loan holder unless the holder does not have your current address.
For defaulted borrowers, you, a member of your family or another reliable source must contact the loan holder to let them know that you live in a designated disaster area and were affected by the disaster. Collection activities will stop for three months after this notification has been received.
Contact your loan holder to request relief. All borrowers can also contact the Federal Student Aid Ombudsman at 877.557.2575 or 202.275.0549 for assistance.
If you don’t know who holds your loans, you can find details on all of your federal student loans using the U.S. Department of Education’s National Student Loan Data System (NSLDS).
Receiving disaster relief will postpone your payments—but the type of postponement depends on whether you’re in school or in repayment.
If you are attending school and postponing your payments with an in-school deferment:
If you are currently repaying your loans:
Find out more about deferment and forbearance. If you have additional questions about disaster relief, please contact American Student Assistance® (ASA) or visit the Federal Student Aid website.