We get this questions a lot and the short answer to it is Yes and No. There are no direct grants that will help you pay off your student loans but there is a relief program or also what is called as a forgiveness program where if you qualify you can have a significant amount of your student loans waived. While not technically a grant, these are known as ‘Public Student Loan Forgiveness(PSLF) Programs’. These student loan forgiveness programs are available to graduating students to assist them in reducing the burden of their outstanding loans. The graduating student can be majoring in any field and they can still be provided this financial assistance provided they qualify for it.
Do I Qualify For Student Loan Forgiveness?
The catch though is that the forgiveness program is not available for everyone. The PSLF was initiated to encourage individuals to work, on a full-time basis, in public service jobs. To qualify for this program, you should have made 120 payments on your Federal Student loan whilst being fully employed in public service, law enforcement agencies, teaching, doctors and nurses and other government based jobs. Just another factor to keep in mind when you decide on the direction of your career. There are some professions and jobs that bring with it a lot of incidental advantages. The field you choose to work in needs to be well thought out, after all it is something you will most likely be doing for a very long time, not to mention carrying the burden of a student loan for a number of post graduate years.
The PSLF program enables graduate students to eliminate a majority of their student loans and sometimes even pay the loan completely. This program is backed by the government and is available towards Direct Federal student loans. The following Direct Loans are covered under the Loan Forgiveness program
- Direct Stafford Loans (Subsidized and Unsubsidized)
- Federal Direct PLUS Loans
- Federal Consolidation Loans (Direct)
The above loans have to be non-defaulting loans. Besides Federal Direct Loans, the PSLF program allows other Federal student loans that have been consolidated under a Direct Consolidation loan. Therefore, all payments made under the consolidated loan will be counted for the120 payments made on a monthly basis.
These 120 payments should be made under these Direct Loan repayment plans:
- Income Contingent Repayment Plan
- Income Based Repayment Plan
- Standard Repayment Plan, having a repayment period of 10 years
- Other Direct Loan Program repayment plan, having a repayment period of 10 years
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