In 2022, student loan debt hit a record-breaking $1.75 trillion nationwide. While the COVID-19 pandemic and the federal deferment program have hit the pause button for some, millions of Americans find themselves straddled with anxiety-inducing debt loads, unsure if they’ll ever pay them off.

The good news is: You may qualify for some relief. While there’s no shortcut for dealing with student loans, there are many student loan forgiveness programs that can significantly decrease how much you wind up paying overall on your higher education.

Your student loan forgiveness options can depend on the type of loan you have, where you live, where you work, and how much you earn. And while each program comes with its own set of (sometimes tricky to navigate) rules, the wide variety opens up options you may not have thought you had. Here’s what you need to know:

Private student loan forgiveness

While there has been plenty of discussion in the news about loan forgiveness, it’s very important to remember that this is only for federal student loans. Private lenders are independent of the US Department of Education, which does not make them eligible for federal or state loan forgiveness programs. 

Loans from credit unions or independent lenders like Earnest or Sallie Mae all fall under the category of private student loans — unfortunately, they’re subject to the terms and conditions set forth by the lender.

Need help with private loans? See how a smart budgeting tool could help you get out of debt.

Federal student loan forgiveness programs

If you have federal loans, you’ll need to meet the eligibility requirements for federal student aid forgiveness. For example, two popular federal forgiveness programs require you to repay your federal loans with certain repayment plans or work at an eligible employer while making your payments. 

  • Income-Driven Repayment Plan Forgiveness: Income-driven repayment (IDR) plans can lower your monthly payment by basing your payment on your income and family size. Additionally, IDR has a limited repayment period. Depending on the plan, the remainder of your student loan will be forgiven after you make payments for 20 to 25 years. 
  • Public Service Loan Forgiveness: The Public Service Loan Forgiveness (PSLF) program is one of the most popular forgiveness programs because you can get the remainder of your federal loans forgiven after making 120 monthly payments (10 years’ worth). 

However, you need to have Direct student loans (a type of federal loan), be on a qualifying repayment plan, and work full-time for a qualified nonprofit or government organization while making those payments. To learn more and see if you qualify, check out the limited PSLF Waiver. 

Which student loan programs can be forgiven?

So, which loan programs can actually be forgiven? It’s important to remember that total absolvement of your debt is exceedingly rare. Your outstanding balance can be forgiven depending on the type of loan — let’s take a look at the different programs:

Direct loans

A direct loan is exactly what the name implies — it’s a loan taken out by students directly from the federal government. Starting in July of 2010, all federal student loans have been funded through the Federal Direct Loan Program. There are a few different types of direct loans:

  • Direct subsidized loans — these loans have the interest rate paid by the government while you’re in school, during your grace period upon graduation, and if you need a deferment.
  • Direct unsubsidized loans — the borrower is responsible for paying all interest.
  • Direct consolidation loans — these loans allow borrowers to consolidate multiple federal loans into one balance, with one interest rate and one monthly payment.
  • Direct PLUS loans — these loans are specifically for graduate or professional students to pay for their educational expenses.

Parent PLUS Loans

Parent PLUS Loans are a type of direct federal loan granted to the parents (either biological, adoptive, or stepparent) of a dependent undergraduate student. These can be forgiven under a few select circumstances. 

Federal Perkins Loans

A Federal Perkins Loan is a certain type of low-interest federal student loan which is offered to student loan borrowers with exceptional financial need, usually low-income students. As a subsidized loan, the government pays the interest that accrues. 

Federal Family Education Loans

While this program ended in 2010, the Federal Family Education Loan (FFEL) program worked with private lenders to secure loans for students and parents guaranteed by the federal government. 

The program has been replaced with the William D. Ford Federal Direct Loan Program, in which students borrow directly from the government at participating institutions.

Student loan forgiveness programs for military members

Service members may be eligible for the PSLF, as well. Additionally, there are student loan repayment assistance programs for service members with different amounts of assistance depending on your military branch, current need, and experience. 

State-dependent loan forgiveness programs

Some states and state-based organizations also have student loan forgiveness programs for eligible residents. These tend to be for people who work in a particular profession, such as healthcare workers and attorneys who serve a high-need population within the state. 

Profession-dependent student loan forgiveness programs 

In addition to the state-dependent programs, there are federal, school, and industry-funded loan repayment assistance programs (LRAPs) available to members of certain professions. Generally, you’ll need to commit to working in a specific job or area for several years to receive assistance in loan repayment.

Similar to the state-dependent programs, these also tend to be for healthcare workers and lawyers working in underserved areas, but you may be able to find opportunities in other fields as well. 

Teachers can also qualify for loan repayment programs, especially if they’re employed through an educational service agency (ESA). If you’re working with a qualified employer, you can fill out an application, but not all ESAs offer teacher loan forgiveness — check with your employer for eligibility terms.

Employers’ student loan forgiveness programs

Some companies offer student loan forgiveness as a benefit to employees. While not all that common, they’re worth asking about while job hunting and proceeding through the interview process. 

Jobs through the state, teaching professions, public servants, doctors, and lawyers can all find positions with employers who may be able to help pay their student loan debt. This can look like the employer making monthly payments directly or contributing to your monthly payment via payroll. 

COVID-19 and student loan relief

The Coronavirus Aid, Relief, and Economic Security (CARES) Act didn’t directly offer student loan forgiveness to borrowers, but it did provide temporary relief to borrowers with federally held student loans. As the world screeched to a grinding halt, the CARES act enacted a pay pause for all federal student loans. 

Eligible loans receive a 0% interest rate and deferred payments from March 13, 2020, and the pause is currently set to expire on August 31, 2022. Additionally, the missed payments count as qualifying payments toward IDR forgiveness. They also count toward your required 120 PSLF payments if you meet the other requirements, including remaining a full-time employee at a qualifying organization. 

Private student loan companies may also offer hardship programs to borrowers, although the CARES Act doesn’t require it and the loans won’t be eligible for federal forgiveness programs. 

Student loan forbearance

While the grace period of the CARES Act was initially set to expire on September 30, 2020, the date for the forbearance expiration has continually been extended as the world has coped with the massive economic changes brought on by the pandemic. 

The Biden administration extended the forbearance period once again, changing the expiration from April 6, 2022, to August 31, 2022 — but many economists feel that the administration may very well again extend the period. 

What this would mean for borrowers is a continuation of the moratorium, meaning zero interest accrued or paid and monthly payments paused. However, it’s entirely possible that the forbearance will expire, so it’s best for borrowers to prepare to begin making their monthly student loan payments again. 

Biden student loan cancellation

President Biden has publicly discussed exploring mass loan forgiveness — his administration thus far has been responsible for canceling nearly $32 billion in student debt since taking office. 

The borrowers these policies have affected fall mostly under the borrower defense category, which are students whose university was closed or who were misled by the institution. Nearly $9.6 billion has been forgiven via PSLF and an additional $9 billion has been forgiven for students with permanent disability. 

While hundreds of thousands of students have had their debts forgiven, there’s still discussion of further forgiveness that might be exercised by the current administration. Let’s take a look at what’s being discussed: 

$10,000 forgiveness

The President has expressed a willingness to consider absolving $10,000 worth of debt for every student with federal student debt — in fact, it was something he campaigned on. Many observers feel that this is the most likely course of action.

$50,000 forgiveness

Democratic Senate leaders and coalitions of civil rights groups and activists have called on Biden to forgive $50,000 worth of student debt, hoping that this would help stimulate the economy while addressing wealth disparity and the income gap.

However, the President has gone on record opposing this amount.

Complete federal forgiveness

The forgiveness of all federal debt has been called for ever since the loan forgiveness initiative was launched in 2007, but it’s extremely unlikely that this will happen. The Biden administration has positioned itself as a proponent of partial debt forgiveness, but a complete and total forgiveness program of all federal student loan debt will almost certainly not happen. 

No forgiveness

It’s important to remember that President Biden is only considering partial debt relief, not sweeping loan forgiveness. It is also entirely plausible that there will be no forgiveness on any federal student loan debt, with several deterrents including a congressional hold-up. Borrowers who are considered in the high-income class also may not qualify for forgiveness. 

While the prospect of having your federal student loan forgiven has been subject to a hotly contested debate politically, the best plan of action right now is to proceed as if your pay period and amount due are returning to normal. 

Keep in mind that while the President may extend forbearance (or he may not), he has said that he will make an announcement prior to resuming payments. 

Repayment options

Should the collection of federal student loan debt return to normal, you should remember that under ordinary circumstances it’s extremely difficult to get a loan forgiven. Your best plan is to focus on your repayment options. 

Consolidation

Student loan debt consolidation can be a good option for borrowers with multiple student loans, allowing them to make one monthly payment with a singular interest rate. A drawback to be mindful of however is the rising federal interest rate — it could result in higher interest paid on your loan.

Deferment

Since 2020 and the COVID-19 pandemic, we’ve essentially been in a period of deferment — this option to exercise a payment pause is available to borrowers who are really struggling to make ends meet.

Unfortunately, the interest-free deferment of the CARES Act is set to expire soon. Once things return to normal, deferred loans will again accrue interest. For more information, check out the Federal Student Aid website here.  

By implementing a strict budget and planning for payments to resume as normal, you can better position yourself to stay out of debt. Keep track of your loan balance and your monthly payments in order to stay in good standing!

Have you put a plan in place to start chipping away at your student loan debt? Take a look at our guide here.

Learn more and confirm you’re on the right track

While student loan forgiveness programs can save you a lot of money, the rules and requirements can be complicated to understand and follow. Unfortunately, some student loan servicers (the companies you send your payments to) don’t have a great track record of helping steer borrowers in the right direction. 

Visit studentaid.gov and the Department of Education – they’re the best places to start if you want to learn more about the federal student loan forgiveness options. 

If you have specific questions, you can find low-cost student-loan counselors at nonprofit credit counseling organizations, or a student-loan attorney may be able to help you with more complex matters. Just be sure you’re working with a reputable organization.

Read more: Budgeting tools to help you get out of debt