Federal student loan forgiveness
Federal student loan forgiveness is when your federal student loans are cancelled or discharged—this means your remaining balance has been taken care of and you don’t have to pay them back. This is similar to career-based forgiveness and programs because they all involve paying off some or all of your student loan balance, but they differ in where the money is coming from. Federal student loans are forgiven by the government exclusively, while career-based forgiveness and grants can come from the government, colleges and universities, and more.
Public Service Loan Forgiveness (PSLF)
You may be eligible for grants through PSLF if you are a government employee or work for a not-for-profit organization. You could get your total Direct Loan balance forgiven if you’ve made 120 qualifying monthly payments through an eligible repayment plan, or if you work full-time for an eligible employer.
Income-Driven Repayment Plan Forgiveness
With four different income-driven repayment plans to choose from, they all will base your federal student loan payments on a percentage of your income. If you’re still carrying a balance after 20 or 25 years, your total balance will be forgiven. Keep in mind that you will have to pay taxes on your forgiven balance.
Perkins Loan Cancellation
We mentioned how Perkins Loan Cancellation is a great way for teachers to get some student loan debt relief, but first responders, librarians, health care workers, and more may be eligible. See the full list on the Department of Education’s Federal Student Aid website.
Cancellation and Discharge: There are also a few other circ*mstances in which the federal government may forgive your loans, including:
- Death
- Disability
- Bankruptcy
- Your school closes while you’re enrolled or soon after you withdraw
- Your school wrongly certified your eligibility for a loan
- Someone stole your identity and signed up for a loan
- You withdrew from school and never got a refund for the remainder of your tuition
- You became total and permanently disabled during military service
State-based grants
There are state grant programs nationwide, and the state you live in probably has at least one. Many state-based grants are tied to certain jobs and industries, so it’s worth researching the state and industry you’re interested in to see what grants may be for you. Here are a few so you can get an understanding of what’s out there.
New York State Young Farmers Loan Forgiveness Incentive Program
New York State has $10,000 up for grabs for students who graduate from an in-state university, plan to run a farm in New York for at least five years, and apply within two years of graduation.
New York State Child Welfare Worker Loan Forgiveness Incentive Program
This incentive program could earn you $10,000 a year for up to five years of you working in a New York State child welfare agency.
Maine Alfond Leaders Program
For people living in Maine and working in STEM, you could get up to $60,000 to put towards your student loans with this program.
Grants for members of the military (and their families)
Military grants are need-based grants for members of the military, veterans, and relatives of active military members and veterans. They are often funded by the government, but some may be offered by colleges and universities. To be eligible, students must have a military status or have a family member with a military status. They will also likely need to complete the FAFSA® to be considered.
Army Loan Repayment Program
If you enlist in the military after going to college, the military can forgive any student loans you’ve accrued over the course of your studies.
Army Reserve College Loan Repayment Program
If you work in a specific specialty and serve in the army for at least six years, this grant program can give you up to $50,000 to pay off your student loan debt.
Iraq-Afghanistan Service Grant
To meet the criteria for this grant, you must have a parent or guardian who was a member of the U.S. armed forces and died while serving in Iraq or Afghanistan, you had to be under 24 years old or enrolled in college at least half-time at the time of your parent’s or guardian’s death, and you must meet the eligibility requirements of the Federal Pell Grant. The award amount is the same as the maximum Pell Grant available for that award year. The award for the 2023-24 year is $7,395.
Health Professions Student Loan Repayment Program
Healthcare professionals like pharmacists, nurses, veterinarians, doctors, dentists, and more who enlist in the army may be eligible for up to $120,000 to pay off their student loans depending on how long they enlist.
The military also offers special student loan forgiveness programs in:
Grants for volunteers/non-profit employees
Volunteers and non-profit employees are also eligible for grants through the Public Service Loan Forgiveness (PSLF) program and through other national organizations, like AmeriCorps, the Peace Corps, and Teach for America.
Grants for employees at private companies
Some private companies also have their own grant and loan forgiveness programs for their employees. This is often a benefit offered to employees and is a part of their benefits package. If you’re interested, it may be worth it to ask your employer if your company has a grant or loan forgiveness program you qualify for.
Chegg
Chegg has a grant program that’s also leveraged as a recruitment tool. Entry-level to manager-level employees who have been working at the company for at least two years, have graduated from college, and have student loan debt are eligible for an annual $5,000 grant. An employee on the Director level or Vice President level must adhere to the same criteria to earn a $3,000 annual grant towards their student loans.
PricewaterhouseCoopers
Participating associates or senior associates at PwC may be eligible for a grant worth up to $1,200 a year (up to $10,000 total) towards their student loan debt.
How to find grants yourself
Grants and student loan forgiveness programs aren’t too hard to find—you just need to know where to look.
Check within your industry of choice. There may be state- or federal-based programs that offer student loan forgiveness to people who do the jobs that you do. You may need to work in high-needs areas to get the grants, but it’s worth taking a look.
Talk to the financial aid office at your school. Certain post-grad schools like law school or medical school may offer to forgive your student loan debt in exchange for your service working in communities that need you the most.
Ask your employer. Some companies have grants, scholarships, and student loan forgiveness benefits for employees—you should definitely take advantage of them if they’re available to you.
Quick guide on how to apply for student loan grants
Here are some quick tips on how to apply for grants to pay off your student loans. For starters, you are NOT taking out another student loan to pay off your other student loans. Grants are free money you don’t have to pay back.
1. Look for grants that fit you
As you start searching for grants, look for ones that are suited for your exact situation. You may have better luck at winning them!
- Find organizations related to your career interests and see what grants may be out there.
- Look up your state and see if they have any state grant programs available.
- If you’re employed, ask your employer if the company offers grants or other student loan benefits to employees.
- Contact the financial aid office of the college you attended and see if there is anything they can help you with.
2. Fill out the grant application
Once you find a grant you want to apply to, it’s time to fill out your application. Keep in mind that the application may be online or in a physical document you’ll have to mail in. Here are some of the things you may be asked:
- The name of your university and proof of graduation
- Proof of employment—a pay stub or letter from an employer
- Proof of residence—such as a bill with your name on it
- Legal identification—a driver’s license, passport, or state-issued ID
- Info on all the loans you’re applying to get forgiven
- Resume and/or cover letter
- Personal essay
- Recommendation letters
3. Keep an eye on the grant’s due dates
Due dates are super important when it comes to grants. Many grant programs operate annually, so you can only apply for them once a year. If you miss a deadline, that’s okay. Keep looking for grants with open deadlines, and take note of the ones you missed. Mark those grants in your calendar or set a reminder to prepare for next year’s deadline.
Ready to look for grants?
Grants can be a great way to help you pay off your student loans. Just remember to look for grants that suit your needs, keep track of grant opening and closing dates, and always look into other repayment options if you’re having trouble paying back your loans.
