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Student Loan Forgiveness Guide

You may be able to get some or all of your federal student loans forgiven if you enter into one of several careers. Although qualifying for forgiveness is not as straight forward as you might hope, so make sure you know the ins and outs of the program for which you hope to qualify.

Student Loan Forgiveness GuideYou may be eligible for student loan forgiveness if you graduate from college or graduate school with one or more federal student loans and either volunteer, serve in the military, or work in certain fields in low-paying, high-need areas. Student loan forgiveness means that some or all of you federal student loans will be canceled. Here are descriptions of some of the most common ways to qualify:

Volunteer service

If you service in the Peace Corps, you may apply for deferment of federal Stafford, Perkins and consolidation loans while you serve. You may also apply for partial cancellation of federal Perkins Loans for an amount equal to 15 percent for each year of Peace Corps service, up to a maximum of 70 percent.

Volunteers for AmeriCorps, which provides domestic disaster relief, community-building programs, and the popular Teach for America program, receive a stipend of up to $7,400 for one year of service plus up to $4,725 of federal student loan forgiveness. (Note: Teach for America participants receive a full teacher’s salary in lieu of the $7,400 stipend.)

The Volunteers in Service to America (VISTA) program coordinates volunteer service with private non-profits that battle domestic issues including poverty, huger, and homelessness. One year of VISTA service can earn you up to $4,725 in student loan forgiveness. Some “volunteers” also receive a stipend.


Full-time teachers working in schools that serve low-income populations—or in high-need areas such as math, science, foreign languages, and special education—have a variety of student loan cancellation options. Teachers in these areas may be eligible for full or partial cancellation of federal Perkins and Stafford loans. More information about loan cancellation for teachers is available from the U.S. Department of Education and and the American Federation of Teachers.

Non-profit law

A variety of law school loan forgiveness programs are available for lawyers who enter public service or work in non-profit fields.

Medical professions

Student loan forgiveness for the students becoming physicians and nurses is available from the National Health Service Corps and the Nursing Education Loan Repayment Program. To be eligible for forgiveness from these programs, students must agree to practice for a number of years in high-need areas, which are usually remote or struggling economically.

The U.S. National Institutes of Health also offers a that may pay of up $35,000 per year of student loan debt for students involved in medical research.

New programs are popping up every year to encourage students to enter emerging high-need medical fields such as occupational and physical therapists and medical technicians. Check with your school (or schools you are considering attending) for up-to-the-minute information about medical loan forgiveness programs.

Military service

The U.S. Armed Forces offer several generous programs to help its members pay for their education. For example, members of the Army National Guard may qualify for up to $10,000 in loan cancellation.

Have you had a student loan forgiven through one of these or another student loan forgiveness program? What did the process entail? Was it worth it?

Published or updated on August 25, 2008

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About David Weliver

David Weliver is the founding editor of Money Under 30. He's a cited authority on personal finance and the unique money issues we face during our first two decades as adults. He lives in Maine with his wife and two children.


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  1. net says:

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  2. Robert G says:

    Ever since the gov’t did a total imersion into the student loan process (besides backing the loan), I have been struggling to just manage my debt via consolidation with several institutions (Direct Loans, Nelnet, Great lakes, ACS). They all are quick to point me back to the other in order to defer and consolidate. Not to mention trying to reach someone to speak with, and when you do reach someone they are usually not forth coming with info and curt. They are also quick to get you off the phone. The first two years with Direct Loans were clear, then the Obama admin decided to “share the wealth”. Nice idea, terrible execution. the folks at Dept Ed are ridiculous with their bureaucratic bloat. I wish our elected officials took the same effort they did for health care and applied it to education for all!

  3. robyn says:

    Great roundup! To add some info on Phillip’s comment above– the website contains information about both income-based repayment and public service loan forgiveness. The legislation has passed, but Congress is still in the rulemaking process, so look out for more changes. also contains an interactive calculator you can use to see if you qualify!

  4. Phillip says:

    There is another loan forgiveness program for those in public service. It involves 10 years of payment and after 10 years anything left is waived. The monthly payment is based upon a percentage of your income. However there are two methods used to calculate the monthly payment required. To the extent of my knowledge, one is in effect now (Income-contingent) and the other method of calculating your monthly obligation(Income-based) does not come into play until 2009.

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