Practical and Helpful Tips: Lenders

Types of Loan Forgiveness Programs

Loans play an importantly indisputable role towards progress in various aspects of your life. Ideally, the burden of repaying the loans purely rests on you. You can be lucky to qualify under some special terms, for cancellations of all or part of your whole loan debt burden. Even worse is when you get yourself into the web servicing multiples of loans, and you are not in employment or you have been hit with a disability and you your ability to work and earn in put in jeopardy. Thanks to the loan cancellation programs now in place. You have an opportunity to apply for relief from the financial responsibility of repaying an educational loan, whose form of education you are no longer interested in. You are going to learn four types of loan forgiveness programs you did not know about.

The common program of the four is public service forgiveness program. Public servants such as teachers, nurses, fire fighters and military personnel, just to mention a few, can qualify for the benefits of the program. There are however, some factors which are taken into consideration when assessing your eligibility for the benefit of the program. All those employees working in the government or in a non for profit organization and have repaid their loans without default for ten consecutive years are eligible for the program upon application. However, only federal direct loans are the ones qualified for the program and you have an opportunity to consolidate every other student loans so that they are repayable under the program.

The second one is income driven loan forgiveness program. The income driven loan cancellation has interesting feature whereby you as the borrower has an opportunity to pay a lesser amount of your regular monthly repayment. You will get to benefit from any of the four alternatives under income based loan forgiveness program, which include, pay as you earn, revised pay as you earn, income contingent repayment, and income based repayment. There are conditions which you must meet for you to qualify for either of the four types of income driven loan cancellation programs. The programs will benefit borrowers who have consistently serviced their loans for over twenty years and it is targeted at those with huge loan balances outstanding.

A special type of loan cancellation program intended for teachers only is the teacher loan cancellation program. Teachers who have worked for five years following each other uninterrupted will have a reason to smile. The unique benefit with teachers loan forgiveness program is that the loan burden is reduced by some specific amount of money. It is however for those teachers who are working in low income public elementary and secondary schools and have got direct loans and Stafford loans.

The last program in the four is the Perkins loan forgiveness program. State employees who have worked for five years are eligible. With Perkins loan cancellation program you will be relieved from repaying all the outstanding amount of loan

The four loan forgiveness programs are major ones available for students loan borrowers.

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