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Obama Federal Student Loan Forgiveness Programs

Obama Federal Student Loan Forgiveness Programs

Federal student loan forgiveness is a much misunderstood concept.  While there is no easy way to snap your fingers and have your student loan debt magically disappear, there are ways to get your student loan debt forgiven.

Today there many programs available to help people who work in public service, education, and more. Some states are even helping debt-saddled graduates with their loans as well.

If you are struggling with student loan debt, read on to see if there is a forgiveness program tailored to your situation.

1) Public Service Loan Forgiveness

The Public Service Loan Forgiveness (PSLF) Program is a federal program that forgives the remaining balance on your Direct Loans after you have made 120 monthly (10 years) payments under a qualifying repayment plan while working full-time for a qualifying employer such as a non-profit or a government institution or agency.

Who is eligible and what loans are eligible?

Full-time employees at a federal, state or local government agency as well as nonprofit workers at an organization with a 501(c)(3) designation. For purposes of this program, religious-based work at a non-profit does not qualify, The following loans are eligible

  • Federal Direct Subsidized Stafford/Direct Loans
  • Federal Direct Unsubsidized Stafford/Direct Loans
  • Federal Direct PLUS Loans
  • Federal Direct Consolidations Loans
  • Federal Family Education Loans (FFEL) (if consolidated via a Direct Consolidation Loan)

How can I become eligible?

Consolidating your loans with the federal government can be a good first step when pursuing Public Service Loan Forgiveness. A Direct Loan Consolidation combines all of your federal loans into one new single loan (even previously ineligible loans like Perkins or FFELs can be included and become eligible). During the consolidation process you can also choose an alternative repayment plan.

What are the requirements?

  • Make 120 on-time payments towards your Direct Loans. Your 120 qualifying monthly payments do not need to be consecutive.
  • Payments must be under a qualifying plan. Qualifying plans include: Income-Based Repayment (IBR), Pay As You Earn Repayment (PAYE), Revised Pay As You Earn (REPAYE), Income-Contingent (ICR) and Standard Repayment. (Note that for many borrowers it makes sense to go with an income-driven plan to maximize the amount you will have forgiven and lower monthly payments.)
  • Work full-time at a qualifying organization. You do not have to work at the same place for ten years to qualify

How do you apply for Public Service Loan Forgiveness?

  1. Fill out the Employment Certification Form each year, or as you change jobs.
  2. Submit the form to FedLoan Servicing.
  3. FedLoan Servicing will review your information and let you know if you qualify. They may ask for more information and ask for pay stubs, W-2s, or other documentation.
  4. FedLoan Servicing will let you know how many qualified payments you have made, and how many payments you will need to make until you qualify for forgiveness.
  5. Once you become eligible, you will submit a PSLF application. It is currently not available, as the first rounds of loans to be forgiven is slated for October 2017.

Currently, there is no limit on the amount forgiven under Public Service Loan Forgiveness. In other words, the full amount of your federal student loans is eligible for forgiveness.

If you have any additional questions, check out this Public Service Loan Forgiveness Fact Sheet.

2) Teacher Loan Forgiveness (AKA The Title 1 Loan Forgiveness Program)

Who is eligible?

Teachers who work at low-income schools are eligible for this program. Check out the Annual Directory of Designated Low-Income Schools for Teacher Cancellation Benefits to see if your school qualifies.

Which loans are eligible?

Direct Loans and Federal Stafford loans are eligible for student loan forgiveness for teachers. Unfortunately, if you only have PLUS loans, you are not eligible for this program.

What are the requirements?

  • You must teach in a low-income elementary or secondary school
  • You cannot have loans that originated before October 1, 1998
  • Your loans must not be in default
  • Work full-time as a teacher for five consecutive years
  • Be a highly qualified teacher, which means obtaining state certification and holding a license in the state you teach in

Highly qualified elementary and secondary school teachers may receive up to $5,000 in loan forgiveness.

Teachers that are considered ‘highly qualified’ and teach math, science, or work in special education are eligible for up to $17,500 in student loan forgiveness.

How do you apply?

After teaching for 5 years, you can apply for teacher loan forgiveness by completing the Teacher Loan Forgiveness Application and then return your application to your loan servicer.

3) Teacher Cancellation for Federal Perkins Loans

Who is eligible?

Full-time teachers at low-income public or nonprofit elementary or secondary schools or those that specialize in certain subjects, like math, science, and special education.

There are other special circumstances that make teachers eligible for this program. These include: working in a private school that has its nonprofit status, working at an educational service agency or teaching in a designated subject shortage area.

Which loans are eligible?

Only the Federal Perkins Loans are eligible for this program.

What are the requirements?

Teachers must work full-time for a full academic year to qualify for loan cancellation. Qualified teachers are eligible to have:

Qualified teachers are eligible to have:

  • 15 percent of their loans cancelled for the first and second years of service
  • 20 percent of their loans cancelled for the third and fourth years of service
  • 30 percent of their loans cancelled for the fifth year of service

Therefore, after five years of service, qualified teachers with Federal Perkins Loans can have 100 percent of the loans cancelled.

How do you apply?

First you will need to request certain forms from the office that administers the Federal Perkins Loan program at the school that has your loans. You will need to provide various types of documentation, at the school’s request. The school handles determining whether you qualify or not for the loan cancellation.

4) Special Teacher Forgiveness Programs by State

New York

The New York City Loan Forgiveness program offers teachers working in certain shortage areas the opportunity to forgive a portion of their loans. The award amount varies, but its value is up to $24,000.

Teachers must work for 6 years in an authorized New York City Department of Education school. Learn more about eligibility, requirements and the application.


The Teach for Texas Loan Repayment Assistance Program can forgive up to $2,500 for teachers that work in a field as well as a community, where there is a shortage of teachers. Learn more about the program here.


The Illinois Teachers Loan Repayment Program is awarded to teachers who work in low-income schools. You must work in a low-income school for 5 years. Teachers must be eligible for a federal loan forgiveness program — this program can make a matching award up to $5,000.

Find out more information about the program here.

5) Special Forgiveness Programs for Doctors by State

New York

The Regents Physician Loan Forgiveness Award Program can help physicians practicing in New York and award up to $10,000 each year, for 2 years. Applicants must be licensed in New York State and have completed residency in the past 5 years. The focus on this program is primary care. Applicants must agree to work in a specific area or work with an underserved population. Find out more.

In addition, there is also the Physician Loan Repayment – Qualified Educational Loan Repayment, which awards up to $150,000 to physicians that commit to a 5-year term of working in an under served region.


Healthcare professionals like doctors, nurses, pharmacists and dentists can apply for The Health Professional Loan Repayment Program. This program awards up to $35,000 per year, for 2 years. Healthcare professionals must provide primary care in an under served or rural area.

Get the full scoop on this program.


Primary care practitioners such as doctors and dentists can get up to $100,000 (yes, really) awarded for working full-time for two years with medically underserved populations.

Physicians must be licensed in Pennsylvania and meet certain requirements. Learn more about this program, which has one of the best awards we’ve seen.

6) Federal Perkins Loan Discharge for Nurses

Did you use Federal Perkins Loans to pay for your schooling? If you work as a full-time nurse, you might be eligible for up to 100 percent of your loans discharged.

What are the requirements?

You must be a registered nurse and employed full-time. Loans aren’t discharged immediately, though; instead, they are discharged over five years.

How do you apply?

You can apply through your loan servicer or through the school that disbursed the loans.

7) NURSE Corps Loan Repayment Program

If you work in an underserved community, you might be eligible for the NURSE Corps Loan Repayment Program. You can get up to 60 percent of your student loans in two years of employment. If you work for a third year, you might qualify for another 25 percent being paid.

What are the requirements and how to apply

You must a registered nurse and work in a facility that is qualified as a Critical Shortage Facility. You need to work at least 32 hours a week at the facility.

Applications are accepted once a year, and guidelines are updated annually. Check the program requirements and guidelines ahead of time and turn in your application on time.

8) Special Forgiveness Programs for Nurses by State


The SHARP program recruits healthcare professionals to work in certain areas of shortage. In return, they get loan assistance as long as they work at a site with an employer match.

Nurses can receive up to $27,000 per year in loan assistance under the Tier-2 program.


If you work in a healthcare shortage area, you might be eligible for help under the Arizona Loan Repayment Program. Nurse practitioners can work full or part-time at a qualified facility for at least two years. You can get up to $50,000 in repayment help for each year of service.


Registered nurses working in a Health Professional Shortage Area or Medically Underserved Area in California can receive up to $8,000 to help with student loans. You must work for two years. After that, you can reapply and get up to $11,000 in assistance.


The Colorado Health Service Corps program offers full-time nurse practitioners the chance to receive up to $50,000 in repayment assistance for working in for three years in a qualifying organization. Half-time nurses can receive up to $25,000.


The Florida Nursing Student Loan Forgiveness Program offers up to $4,000 per year for those who work in Health Professional Shortage Areas at qualifying organizations. Your loans must come from a nursing education program, and you must be licensed as an LPN, RN, or ARNP in the state of Florida to qualify.


If you work in a Health Professional Shortage Area in Hawaii, you can receive loan assistance. You need to work full-time for two years or half-time for four years to qualify. Award amounts vary based on available funds, as the Hawaii State Loan Repayment Program is a grant program.


Idaho offers a program to a variety of healthcare professionals, including nurses, who work in Health Professional Shortage Areas. The awards range from $5,000 to $25,000 a year, depending on where you work and your qualifications.


If you are a nurse committed to working in a veterans’ home, you could be eligible for repayment assistance of up to $5,000 per year. You do need to be an Illinois resident and meet licensing requirements. Your employment must be verified in good standing by the Illinois Department of Veterans’ Affairs.


Iowa offers the Registered Nurse & Nurse Educator Loan Forgiveness Program which helps pay off up to 20 percent of your student loan balance.

You must be employed in Iowa to qualify. If you hold a master’s degree or higher and teach at a qualified college or university, you can qualify as a nurse educator. You must be in good standing with your federal loans and be employed at least quarter-time.


If you commit to working in a Health Professional Shortage Area for two years, you can receive up to $20,000 in repayment assistance from the Kansas State Loan Repayment Program. This award is open to a variety of healthcare professionals.


For every dollar provided by the program to help repay your student loans, your employer, a foundation, or a friend needs to match as well. You must work in an area that is qualified as a shortage area for two years to qualify. You can get between $20,000 and $40,000 depending on your designation.


Receive up to $15,000 a year in repayment help when you commit to three years in a Health Professional Shortage Area or nonprofit in Louisiana. If you are licensed in Louisiana and in good standing with your student loans, you can get this help if you work full-time.


The Janet L. Hoffman Loan Assistance Repayment Program offers between $1,500 and $10,000 per year for three years. You need to work as a nurse in low-income and underserved areas, and your gross salary can’t be more than $60,000. Awards are given based on how much student loan debt you have.


You can get up to $200,000 over eight years to help you repay your student loans through the Michigan State Loan Repayment Program. You need to be a nurse practitioner in an area that is considered underserved and work at least two years.


The Minnesota Nurse Forgiveness Program provides assistance to registered nurses or licensed practicals who are willing to work in a licensed nursing home or with the developmentally disabled. You need to work for at least two years, and receive up to $5,000 a year. You can apply to extend for another two years.


If you are a registered nurse working full-time at a Montana state hospital or prison, you might be eligible for the Montana Institutional Nursing Incentive Program. With this program, you need a loan balance of at least $1,000. You will receive assistance based on state funding and candidates applying for help. You can apply for up to four years.


You can participate in the matching fund program offered by Nebraska. It’s designed to attract healthcare professionals. Employers willing to help with student loan repayment can receive matching funds from the state, up to $20,000 a year. You must be willing to work three years in an area designated as one with a shortage.

New Hampshire

You can receive up to $45,000 for working three years in an underserved area with the New Hampshire State Loan Repayment Program as a nurse practitioner. You can apply to extend by another two years and an additional $20,000 when you complete your three years.

New Jersey

The Primary Care Practitioner Loan Redemption Program offers certified nurse practitioners the opportunity to get up to $120,000 in assistance over four years. You need to work in Health Professional shortage Areas to qualify, depending on your outstanding loan balance.

New Mexico

Get up to $25,000 or $35,000 a year from the New Mexico Health Professional Loan Repayment Program if you are an advance practice nurse working full-time for two years. You must be licensed in New Mexico and a resident, and work in a designated area.

New York

If you are a registered nurse with a graduate degree, you might qualify for the New York State Nursing Faculty Loan Forgiveness Program. You can receive up to $8,000 a year for up to five years if you work as an educator in the field of nursing.


Ohio nursing students who plan to work as nurses or instructors post-graduation can receive loan assistance from the Nurse Education Assistance Loan Program. You get up to $1,500 per year, and it’s possible to receive up to 100 percent loan cancellation if you work as a full-time nurse in Ohio for five years.


The Oregon Partnership State Loan Repayment program is designed to attract healthcare providers, including registered nurses and nurse practitioners. If you work in a Health Professional Shortage Area for two years, you can have a percentage of your loan balance repaid. You can also apply for additional years.


As a registered nurse who works full-time in designated areas, you might be able to receive up to $60,000 in repayment help if you commit to two years. You can receive $30,000 in help if you are a half-time worker.

Rhode Island

Take advantage of the Rhode Island Health Professional Loan Repayment program if you are a nurse practitioner or registered nurse working in an underserved area. You can make a two-year commitment for full-time work or a four-year commitment for part-time work. Award amounts vary.

Rhode Isalnd also offers up to $5,000 a year in repayment help for nursing faculty for up to four years.


If you are a Tennessee resident with a nursing license and you are enrolled in a higher education nursing program, you might be eligible for the Graduate Nursing Loan Forgiveness Program. This program acts as a student loan program that forgives you after you work as a teacher after you finish your higher degree.


Receive up to $10,000 for working at least 12 months as a health care provider in an underserved area. You just can’t be a physician to take advantage of the Rural Communities Health Care Investment Program.


The Educational Loan Repayment Program for Nurses provides up to $10,000 a year when you work 12 or 24 months in an area that underserved. You must work at least 45 weeks each year and dedicate 20 hours a week to clinical hours.


Serve two years as a nurse in Virginia, and you could be eligible for up to $25,000 a year toward your student loan balances. You need to have a post-baccalaureate certificate or master’s degree in nursing from a school accredited by the National League of Nursing and work in your field at least 40 hours a week to qualify.


If you work as a primary care provider for three years, you can receive up to $75,000 from the Health professional Loan Repayment Program. You must work in an area designated as a Health Professional Shortage Area.

West Virginia

The State Loan Repayment Program offers up to $40,000 for a two-year commitment in a rural, underserved area. You must be a full-time nurse. You can extend for another two years and be eligible for up to $25,000 more.


Nurses can receive up to $100,000 in loan repayment help through the Health Professions Loan Assistance Program. You must commit to work in an underserved community for at least three years to be eligible.


If you work full-time as a nurse in a qualifying Health Professional Shortage Area, you cn receive up to $20,000 in help paying your student loans. You need to work for at least two years.

9) Special Forgiveness Programs for Lawyers by State

Washington D.C.

The District of Columbia Bar Foundation Loan Repayment Assistance Program helps qualified attorneys by awarding up to $12,000 annually.

The program seeks to increase the amount of lawyers working with low-income communities. Applicants must be a D.C. resident, in good standing with the bar, and also working in the law field for at least 17 hours a week. Learn more.


The Loan Repayment Assistance Programs for Lawyers awards up to $5,000 per year for lawyers who work at legal aid or legal services organizations.

Applicants that work full-time or part-time for a year are eligible for having their loans forgiven annually. More info, including who to contact.


The John R. Justice Student Loan Repayment Program awards up to $10,000 annually to attorneys who work in certain sectors, like juvenile delinquency. Applicants can have up to $60,000 total forgiven.

Attorneys must be licensed in Michigan and be in good standing with the bar. Find out more here.

10) Forgiveness With Income-Based Repayment

An option available to Federal Student loans borrowers is to repay your student loans using income-based repayment plan. Your student loan payments are capped at 10-15 percent of your discretionary income. After making consistent payments under IBR for 20-25 years (terms depend on when you borrowed), your remaining loan balance will be forgiven.

It’s important to note that under current tax law, loans that are forgiven under this program can be taxed as income. Keep this in mind when pursuing this program, so you are not surprised by a potentially large tax bill. The available programs are as follows

  • IBR (Income Based Repayment)
  • ICR (Income Contingent Repayment)
  • PAYE (Pay As You Earn)
  • REPAYE (Revised Pay As You Earn)

Who is eligible?

To be eligible for income-based repayment, your payments must be less than what your payment would be under the Standard Repayment Plan. This is an easy requirement to meet if you have a much larger debt load, compared to your income.

You can use the Repayment Estimator tool to help you calculate your payments, to see if you qualify. You will need to either log in or proceed without logging in to use the tool.

Which loans are eligible?

The types of loans eligible for Income-Based Repayment include:

  • Direct Loans
  • Direct PLUS loans for graduates and professionals (Direct Plus loans made to parents are not eligible)
  • Direct Consolidation loans
  • Federal Stafford loans
  • FFEL PLUS Loans made to graduate or professional students
  • FFEL Consolidation Loans, which did not repay any PLUS loans made to parents

What are the requirements?

Borrowers must make consistent payments for 20-25 years and update their loan servicer when their income changes. Again, this option really only works for those that expect to stay in low-paying fields, but have high-figure debt loads.

How do you apply?

To apply for Income-Based Repayment submit an online application at You can also obtain a paper from your loan servicer. You will need to provide documentation as requested, such as proof of income and a tax return.

If you are ineligible for student loan forgiveness, but are having trouble managing your loans, you have a few other options:

  • Putting your loans in deferment
  • Putting your loans in forbearance
  • Consolidating your loans through a Direct Consolidation Loan, or through a private student loan refinancing company

Interested in refinancing your student loans?

The post Obama Federal Student Loan Forgiveness Programs appeared first on Trading Goodly!.

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Obama Federal Student Loan Forgiveness Programs


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