Mapping Your Future logo Search

Loan Cancellation/Forgiveness/Discharge Conditions: Detailed Explanations

En Español

Bankruptcy

Cancellation is possible only in rare cases if the bankruptcy court rules that repayment poses an undue hardship to the borrower.

return to list of conditions


Closed School Cancellation

Your loan will be cancelled if you (or the student for whom you borrowed a Direct or Federal PLUS Loan) received, on or after Jan. 1, 1986, a portion or the entire loan to attend a school that closed before you completed your program of study. You must have been unable to complete the program because:

return to list of conditions


Death Cancellation

Your loan will be cancelled if you (or the student for whom you borrowed a Direct or Federal PLUS Loan) die. A certified death certificate is required.

return to list of conditions


Disability Cancellation

Your loan may be cancelled if you become totally and permanently disabled. Certification and documentation requirements differ depending on your loan type. Contact your loan holder for more details.

return to list of conditions


Educational Component of Head Start Program Staffer Cancellation

Fifteen percent of your original principal loan amount - plus the interest that accrued during the year - will be cancelled for each complete school year you are a full-time staff member, regularly employed in a full-time professional capacity to carry out the educational part of a Head Start program. The program must operate for a full academic year or its equivalent, and your salary may not be more than that of a comparable employee working in the local educational agency.

return to list of conditions


False Certification by School Cancellation

Your loan will be cancelled if the school falsely certified your eligibility for the loan. To qualify for a false certification loan cancellation, you (or the student for whom you received a Direct or PLUS Loan) must have received funds for a loan disbursed, in whole or in part, on or after January 1, 1986, and:

return to list of conditions


False Certification Due to Identify Theft Cancellation

Effective July 1, 2008, your loan may be cancelled if it was disbursed on or after January 1, 1986 and falsely certified as a result of a crime of identity theft. To qualify for an identity theft cancellation, you must provide your loan holder/servicer with a copy of a local, state, or federal court verdict or judgment that conclusively names you (or the loan’s endorser) as the victim of a crime of identity theft by a perpetrator named in the verdict or judgment. 

return to list of conditions


Fire Fighter Cancellation

Your loan will be cancelled if you serve full time as a fire fighter for service to a local, state, or federal fire department or fire district.

return to list of conditions


Law Enforcement or Corrections Officer Cancellation

Your loan will be cancelled if you serve full time as a qualifying law enforcement or corrections officer. To establish eligibility, the school must determine that your:

return to list of conditions


Librarian Cancellation

Your loan will be cancelled if you serve as a librarian, you have a master's degree in library science, and you are employed in either:

return to list of conditions


Military Service Cancellation

You are entitled to cancellation of up to 50 percent of your loan for full-time, active duty service in the U.S. Armed Forces in an area of hostilities or an area of imminent danger that qualifies for special pay under Section 310 of Title 37 of the U.S. Code. The cancellation rate for every complete year of qualifying service is 12.5 percent of the original principal loan amount, plus any interest that accrued during the year.

return to list of conditions


Nurse or Medical Technician Cancellation

Your loan will be cancelled if you serve full time as a nurse or medical technician providing health care services.

return to list of conditions


Professional Provider of Early Intervention Services for the Disabled Cancellation

Your loan will be cancelled if you are a full-time, qualified professional provider of early intervention services in a public or other nonprofit program under public supervision. Early intervention services are defined as developmental services that:

return to list of conditions


Public or community defender

Full-time attorneys employed in federal public defender organizations or community defender organizations are eligible for public defender cancellations.

Cancellations are for eligible service that includes August 14, 2008, or begins on or after that date, regardless of whether information on the expansion of this cancellation category appears on the borrower's promissory note.

return to list of conditions


Public or Non-Profit Child or Family Services Agency Employee Cancellation

Your loan will be cancelled if you serve as a full-time employee of an eligible public or private nonprofit child or family service agency providing or supervising the provision of services to both high-risk children who are from low- income communities and the families of such children.

return to list of conditions


Loan Forgiveness for Public Service Employees with Direct Loans

You may be eligible to have the interest and principal of your non-defaulted Direct Loans forgiven if you:

Public-service jobs:

Borrowers with loans in the Federal Family Education Loan (FFEL) Program can request this forgiveness program by consolidating their loans into a Direct Consolidation Loan.

return to list of conditions


Speech-Language Pathologist Cancellation

Your loan will be cancelled if you serve as a full-time speech language pathologist, you have a master's degree, and you are working exclusively with schools that are eligible for assistance under Title I of the Elementary and Secondary Education Act of 1965.

return to list of conditions


Spouses and Parents of September 11, 2001 Victims and Public Servants Cancellation

Survivors of victims of the September 11, 2001 terrorist attacks may be eligible for discharge of their entire outstanding student loan balance. No refunds are granted on payments made prior to discharge. Documentation of the victim's presence at the September 11, 2001 terrorist attacks, public servant status, or death or permanent disability may be required.

return to list of conditions


Teacher Loan Forgiveness

Certain teachers who have outstanding Direct Subsidized or Unsubsidized Loans / Federal Stafford Loans (subsidized or unsubsidized) or Direct Consolidation Loans / Federal Consolidation Loans may be eligible to have a portion of their loans forgiven (in other words, they won't have to repay that portion of their debt). There are two different teacher loan forgiveness maximums–$5,000 and $17,500–each with their own set of eligibility criteria (provided below).

To qualify for teacher loan forgiveness up to $5,000, teachers must meet all of the following criteria:

To qualify for up to $17,500 in forgiveness, you must meet of the criteria above and the following additional criteria:

To apply for teacher loan forgiveness or for more information about the program for these loan types, contact your loan holder.

Certain teachers who have outstanding Federal Perkins Loans may be eligible to have up to 100 percent of their loans cancelled (in other words, they won't have to repay their loan debt). To qualify for these provisions, you must serve full time in a public or non-profit elementary or secondary school system, which can include employment by an educational service agency, as a:

Contact the school you attended to inquire about teacher loan forgiveness in the Federal Perkins Loan Program.

return to list of conditions


Tribal College or University Faculty Cancellation

Your loan will be cancelled if you serve as a full-time faculty member at a Tribal College or University.

return to list of conditions


Unpaid Refund Cancellation

A portion of your loan (and applicable interest and fees) will be cancelled if:

Note: You may not apply for this cancellation if you currently are attending the school. In addition, if the school currently is open, you may not apply for this type of cancellation unless you have first contacted the school and attempted to resolve the issue. If the issue is not resolved, you may then apply.

return to list of conditions


VISTA or Peace Corps Volunteer Cancellation

Up to 70 percent of your loan will be cancelled if you serve as a Peace Corps or ACTION volunteer. Schools apply cancellation for volunteer service in the following increments:

return to list of conditions