Getting Student Debt Forgiven

Student Loan Discharges and Cancellation

It's possible to have your student loan debt discharged (canceled) or reduced, but only under certain specific circumstances:

  • You die or become totally and permanently disabled.
  • Your school closed before you could complete your program.
  • For FFEL and Direct Stafford Loans only: Your school owes your lender a refund, forged your signature on a promissory note, or certified your loan even though you didn't have the ability to benefit from the coursework.
  • You work in certain designated public school service professions (including teaching in a low-income school).
  • You file for bankruptcy. (This cancellation is rare and occurs only if a bankruptcy court rules that repayment would cause undue hardship.)

Effective July 1, 2006, a false certification discharge was created authorizing a discharge if the borrower's loan was falsely certified as a result of a crime of identity theft. Until the discharge regulations can be developed, lenders may provide administrative forbearance and guaranty agencies may suspend default collections if a borrower presents evidence showing that the borrower's loan may have been falsely certified as a result of a crime of identity theft. The lender or guaranty agency must believe the evidence is reasonably persuasive.

Discharge provisions differ depending on whether you have a Federal Perkins Loan or a FFEL/Direct Stafford Loan. For an overview of discharge provisions, click here. For more specifics on discharges, scroll down this page.

For information on teaching service discharges, click here.

You might be able to have a portion of your undergraduate FFEL or Direct Stafford Loan forgiven if you qualify as a childcare provider. However, this is a demonstration project and will be available only to the extent funding is available. For more information, scroll down to "Child Care Provider Loan Forgiveness Program" below.

Note that you can't cancel a federal student loan because you're having some financial difficulty, unless you qualify for a bankruptcy discharge.

The information on this site was produced by the US Dept. of Education and has been compiled by the site owners. We are not responsible for accuracy or completeness. Site design (c)2007

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