The Importance of Obtaining Federal Student Loans Forgiveness
The best way to finally free yourself from debt after you have completed your education is to apply for federal student loans forgiveness. Whether partial or full, cancellation of any unpaid or defaulted federal student loans you may have, will provide you relief from future federal student loans payment. It will also spare you from the consequences of having defaulted loans. Keep in mind that defaulted loans will also have a negative impact to your credit score. If you want to obtain a basic understanding of the concept of federal student loans forgiveness, continue reading the rest of the article.
Why You Should Seek Federal Student Loans Forgiveness
As mentioned, loan cancellation – whether in the form of student loan repayment forgiveness or direct federal student loans forgiveness – can save you from experiencing the consequences of having defaulted federal student loans, which include the following: ineligibility for alternative payment options or relief; a dive in your credit score; disqualification from student aid; and lawsuits, among others. This is also a good option to take if you have also tried loan consolidation but has eventually realized that it is no longer viable to keep payments in time.
Apart from this, obtaining federal student loans forgiveness can likewise spare you from the measures, listed below, typically taken either by the United States Department of Education or the agency involved in the collection of the outstanding debt, to wit:
- Offsetting of any tax refunds you might have enjoyed otherwise
- Subjecting you to wage garnishment – that is, your employer will be required by the government to remit a part of your salary or wages to the collecting agency until payment of the loan is complete
- Assigning your case to a private collecting body which entails additional fees that you have to pay on top of your loan
How to Obtain Federal Student Loans Forgiveness
There are several things that you can do to qualify for federal student loans forgiveness. The most popular measures you can take are the following: serve in the military; do volunteer work; and, if you are a teacher or a doctor, practice your profession in specific areas in the country.
There are forgiveness programs for every type of student loan. The best thing to do would be to approach the agency handling the collection of your loan and inquire regarding eligibility requirements for loan forgiveness.
Other Options Aside from Federal Student Loans Forgiveness
If it seems impossible to obtain federal student loans forgiveness, there are other alternatives you can explore. You can either have your loans consolidated or rehabilitated. You can also discuss repayment schemes with the lender and come up with a plan that is favorable to both parties. Aside from these, you can also consider payment relief, the types of which are the following: federal student loans deferment, payment options based on income, forbearance, and graduated payment schemes. These may not offer the level of relief that federal student loans forgiveness can provide, but they can certainly lessen the financial burden brought about by loans.