The Ultimate Guide on Student Loan Forgiveness in 2022

Your Guide to Student Loan Forgiveness in 2022

The nation's student loan debt grows?six times faster?than the nation's economy and is currently totaled at about?$1.75 trillion. With no end in sight, studies show that by 2035 the student loan crisis will reach a whopping $3 trillion. Loan payments have been a growing source of anxiety for students who have chosen to pursue higher education, making student loan forgiveness an appealing option.

The big question is how it all works.

Differences Between Forgiveness, Cancellation, and Discharge

Loan forgiveness, cancellation, and discharge have very similar meanings with only slight differences. Loan forgiveness or loan cancellation are terms used if you are no longer required to make loan payments due to your job. This can be in the case such as teacher loan forgiveness or public service loan forgiveness.

A loan discharge, however, refers to eligible loans being forgiven due to other circumstances, such as a total and permanent disability discharge or if the school you received the student loan from closes. Repayment discharge may vary depending on these circumstances.

How to Apply For Loan Forgiveness

It is a process to have student loans forgiven partially or entirely. To begin, reach out to your loan servicer if you think you are eligible for some level of loan forgiveness. Those who have Perkins Loans should contact the university that made the student loan or the loan servicer appointed for the institution.

When you are in touch with your loan servicer, talk over what loan payments will look like for you during your period of application review for loan forgiveness. You may or may not have to make payments during the review period, depending on the type of forgiveness requested, the type of loan, or the loan provider. Communicate so you can plan ahead for this period.

If your application for student loan forgiveness is accepted, you will receive full or partial coverage of your loan payments. Some discharge types refund qualifying payments already made, and defaulted loans will no longer appear on your show up on your credit record.

However, if your application for loan forgiveness is denied, you must continue making the same qualifying payments formerly required by your loan. Monthly payments should follow the terms agreed upon in the promissory note signed for the original loan. Speak to your servicer about repayment plans and work to bring any defaulted loans out of default. Your servicer can further advise if you believe other qualifications should've been considered and want to continue seeking forgiveness on loans.

Grants for Student Loans to Apply For in 2022

Bold.org offers scholarships for a variety of education levels and with all sorts of eligibility requirements, including scholarships and grants meant to assist students with loans and debt.

Click here to find our full list of?grants to pay of student loans in 2022.

Want to learn even more about student loan forgiveness?

Check out the full article on go.bold.org/forgiveness