Student Loan Cancellation: Forgiveness and Discharge

Student Loan Forgiveness and Discharge

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Student loan debt may be cancelled through two programs: forgiveness and discharge. Loan forgiveness is something you must earn through service for a specified number of years in a certain career field, such as the military or teaching. Loan discharge is granted by your lender (the federal government or private lender) under certain circumstances, such as death or total and permanent disability.

Federal Student Loan Forgiveness and Discharge

Direct Consolidation Loans offer many more options for forgiveness and discharge than Private Refinance Loans. To be eligible for the programs listed below, you will need to meet some very specific requirements. For example, Public Service Loan Forgiveness requires that you make “120 qualifying payments under a qualifying repayment plan while working full-time for a qualifying employer.”1

Forgiveness: Earned through service Discharge: Granted based on circumstances
  • Public Service
  • Teachers
  • Volunteer Work
  • Health Professions
  • Public Interest Law
  • Government Employees
  • Military Service
  • Death
  • Total and Permanent Disability
  • Bankruptcy (in rare cases)
  • Closed School
  • False Certification
  • Unpaid Refund
  • Spouses and Parents of 9/11 Victims and Public Servants

*For an in-depth look at federal student loan forgiveness and discharge, visit the Cancelling Repayment section on

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Private Student Loan Discharge

Unlike federal loans, private student loans do not offer a similar list of potential forgiveness or discharge programs. Some lenders will discharge a student loan if the borrower dies or becomes totally and permanently disabled.

Like federal student loans, private student loans are nearly impossible to discharge through bankruptcy. You would have to prove, during the bankruptcy court proceeding, that repaying your loans would be an “undue hardship.” Meeting this standard is exceptionally difficult, and borrowers usually need the assistance of an attorney to do so.

You should check with your Private Refinance Loan lender to find out about their discharge policies before you apply.

What to do next?

Learn about employer tuition assistance programs

Learn how consolidation and refinancing work