Loan Forgiveness
Loan forgiveness is a program that allows borrowers to have all or part of their student loans cancelled if certain conditions are met. These conditions often include working in specific job sectors, like public service or education, for a set period. It reduces the financial burden on those meeting the eligibility criteria, effectively wiping out or cutting down the debt they originally owe.
Common Questions
What are the typical requirements to qualify for loan forgiveness?
Typically, borrowers must work in a public service job or a specific sector like education for a set number of years and make a certain number of qualifying payments on their loans.
Do private student loans qualify for loan forgiveness?
Generally, private student loans do not qualify for federal loan forgiveness programs; forgiveness is typically reserved for federal student loans.
How does loan forgiveness affect my credit score?
Loan forgiveness can positively impact your credit score by reducing the amount of outstanding debt, thus improving your debt-to-income ratio.