Here’s what to do if you don’t qualify for student loan forgiveness.

Here’s what you need to know.

Student loans

President Joe Biden has canceled over $15 billion in student loans. If you are a government official, a student borrower with a permanent disability, or have been misled by your college or university, you may qualify for student loan forgiveness. (Do you qualify for $5 billion in student loan forgiveness?). However, most student borrowers will not qualify for student loan forgiveness. This is especially true if Congress or the President does not enact large-scale student loan forgiveness. So what can you do? The good news is that there are several options to consider if you cannot qualify for student loan forgiveness.

1. Contact your lender to discuss options, including an alternative payment plan

If you’re having trouble repaying your student loans, your first call should be your lender or student loan officer. There are all types of student loan repayment plans, which could save you money every month. For example, switching to an income-based repayment plan such as IBR, PAYE, REPAYE, or ICR could reduce your monthly payment to as low as $0 per month. Alternatively, there are forbearance or deferment options for your student loans. This could delay your student loan repayments, but be sure to understand if interest will continue to accrue on your student loan balance. Above all, start your conversation early so you can plan for your financial future.

(Here are 6 major changes to student loan forgiveness)


2. Apply for student loan forgiveness at work

Your employer may be willing to pay your student loans. Contact your human resources department to find out if your company offers this benefit for student loan repayment. More and more companies are offering student loan repayment as an employment benefit to attract and retain employees. If your employer does not offer student loan repayment, consider finding an employer that offers student loan repayment as a benefit.

(Will student loan repayments be delayed until 2023?)


3. Refinance your student loans

Refinancing a student loan is a smart option if you’re looking for a lower interest rate, lower monthly payment, or both. When you refinance student loans, you get a new student loan to pay off your existing student loans. The goal of student loan refinancing is to save money and get out of debt sooner. Refinancing your student loans can be especially helpful if you don’t qualify for student loan forgiveness.

This student loan refinance calculator shows you how much money you can save when you refinance student loans.

For example, suppose you owe $100,000 in student loans with an interest rate of 7% and a repayment term of 10 years. Next, suppose you refinance with an interest rate of 3% and a repayment term of 10 years. You would save $221 per month and $26,569 in total.

To qualify, you’ll need at least a 650 credit score, be currently employed or have a signed job offer, and have a low debt-to-income ratio. Be sure to compare lenders online, and you can check your new interest rate for free with most lenders in minutes without impacting your credit score.

If you don’t qualify for student loan forgiveness, don’t panic. There are other options for managing student loan repayment. The key thing to remember is to be proactive. Don’t wait for student loan repayments to resume. Understand all your options now so you can make the best decision for you. Here are some popular ways to pay off student loans faster:


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