How to Discharge Student Debt?
When you get student debt, it can’t be deferred and you have to pay it entirely even though you don’t complete your studies, don’t get a job or whatever the situation is. But certain severe cases can save the student, and the student debt is discharged. There might be a certain reduction in the total amount of the student debt or you the debt may be discharged totally.
Here are a few conditions under which student loan is forgiven.
- Student loan might be discharged if schools get closed.
- Total and permanent disability student loan discharge
- Forgiveness in student bankruptcy but in very rare cases.
- Unpaid refund discharge
- Teacher loan forgiveness
- Public service loan forgiveness and a few other cases when the student debt is deferred.
How you can get Student Debt Discharged?
As we have already mentioned that deferment or loan discharge is subjected to the previous dues status of the students. If their dues are already in default, they will not be eligible for deferment.
If you want to get discharged from the loan, you must pay back and come to a satisfactory record where you can be provided suspension. Here is how you can get your student loan discharged.
- Deferring a Stafford Loan
This category is related to debt discharge if the student can’t get any job and remain unemployed or he faces some serious financial troubles and can’t afford to return the loan or if anyone of the followings is the case:
- You are appointed as a teacher in an area that serves poor families and ultimately you are not paid much.
- The school closes before you complete the program.
- The school doesn’t give you the amount of the loan.
- Court decided that your loan should be deferred.
- You die or become disabled and it becomes impossible for you to work.
- Death Discharge
If you are a borrower and you die, the student loan will be forgiven. In case you are a parent and have to pay loan as well, you will be forgiven the loan if you die or the person on behalf of whom you had borrowed. The process of debt discharge includes that any of the family members must bring the death certificate to the school or the loan provided so that further proceedings can be entertained for deferment.
Public Service Loan Forgiveness
If you are a borrower and employed in a particular public service job and have paid your 120 installments after 2007, you can be considered eligible to be discharged from public service loan. Your loan should not be in defaults and further details have been provided on the official website of the loan provider where the concerned people can check out conditions and terms of applying for deferment.
How to Apply?
Once you have gone through the policy and conditions of your loan provider and you find yourself the eligible person, you should contact the servicer who provided you the loan. The school can also be contacted for applying for the debt discharge.
What you have to do? Download the templates, fill them, submit to the relevant department and wait for your turn to get a confirmation letter.