Throughout the years, various federal loan forgiveness and loan repayment programs have been created, and presently, over 50 such programs exist, approximately 30 of which were operational as of October 1, 2013.
Loan forgiveness and loan repayment benefits are often contingent upon a borrower completing a period of employment in public service or in certain other occupations. Increasingly, however, loan forgiveness benefits have begun to Maine payroll loans be offered as a component of certain income-dependent student loan repayment plans. These types of loan forgiveness and loan repayment benefits provide debt relief to borrowers of federal student loans who make an active choice to enter public service or obtain employment in particular professions, occupations, or specialties, or to repay their loans according to an income- dependent repayment plan. Other forms of debt relief also may be available to borrowers who experience certain unfortunate Maine payroll loans circumstances.
Also as part of the NDSL program, Congress authorized a student loan forgiveness component, which was intended to increase the number and quality of teachers in U.
Loan forgiveness benefits were also expanded to be available to individuals serving in a Head Start program and those serving in an area of hostility while in the armed forces.
Through these provisions, qualified borrowers became eligible to have a portion of their loans canceled based on the number of years of public service completed. Sommer (Oakland: The Independent Institute, 1995), pp. Congress, Senate Committee on Labor Maine payroll loans and Public Welfare, National Defense Education Act of 1958, Report to accompany S.
Congressional Research Service 2 Federal Student Loan Forgiveness and Loan Repayment Programs Subsequent to the enactment of the NDEA, other federal student loan forgiveness and repayment programs were established to target borrowers who entered other professions and worked in high- need areas. Overview of Federal Loan Forgiveness and Loan Repayment Programs This report identifies and describes federal student loan forgiveness and loan repayment programs that are currently authorized by federal law. It provides brief, summary descriptions of identified programs. These program descriptions are intended to provide policy makers with general information about the purpose of existing programs and how they are designed to operate. The program descriptions are not intended to be comprehensive in nature. Readers interested in comprehensive details about a particular program are encouraged to refer to additional resources, including federal statutes, regulations, and agency guidance. Citations are provided for the various programs identified in this report. Over 50 federal student loan forgiveness and repayment programs are currently authorized under federal law. Although each program is designed to operate somewhat differently, they are all intended to provide debt relief to borrowers who perform specified types of service, enter into and remain employed in certain professions, serve in certain locations, or repay their loans according to an income-dependent repayment plan for an extended period of time.
Each of the various programs has unique characteristics and may be distinguished by features such as differing borrower eligibility criteria, benefit amounts, the means through which benefits are provided, or how the program is funded. In this overview, several parameters are identified and used to broadly characterize various aspects of the currently authorized programs.
As some of the terms commonly used to identify the benefits offered through these programs (e. Distinction among Loan Forgiveness and Loan Repayment Programs In employment-focused loan forgiveness and loan repayment programs, a borrower typically must work or serve in a certain function, profession, or geographic location for a specified period of time to qualify for benefits. Congressional Research Service 3 Federal Student Loan Forgiveness and Loan Repayment Programs typically must repay according to an income-dependent repayment plan for a specified period of time to qualify for benefits.
The individual is thus relieved of responsibility for paying that portion of his or her student loan debt.
One of the most important distinctions among these types of programs is whether the availability of benefits is incorporated into the loan terms and conditions and is thus considered an entitlement to qualified borrowers or whether benefits are made available to qualified borrowers at the discretion of the entity administering the program and whether the benefits are subject to the availability of funds. For the purposes of this report, the former types of programs are referred to as loan forgiveness while the latter are referred to as loan repayment. In general, loan forgiveness benefits are broadly available to borrowers of qualified loans. Loan repayment programs also provide debt relief to borrowers for service in a specific function, profession, or location. Loan repayment benefits are generally offered through programs that are separate or distinct from the program through which a federal student loan is made. In many instances, these programs are designed to address broad employment needs or shortages (e. Both types of loan repayment benefits are generally available to a limited number of qualified borrowers. Typically, loan repayment benefits are discretionary and their availability is subject to the appropriation of funds. The text box below provides a summary of some of the distinguishing features of the three categories of debt relief programs examined in this report: programs that provide loan forgiveness for public service employment, programs that provide loan forgiveness following income- dependent repayment, and programs that provide loan repayment for public service employment. The resulting change to the terms and conditions of an existing loan program is referred to as a loan modification. Federal student loans made through programs authorized by Title IV of the Higher Education Act (HEA) and administered by the U.
Department of Education (ED), Office of Federal Student Aid (FSA). Student loans made through programs authorized by Title VII and Title VIII of the Maine payroll loans Public Health Service Act (PHSA) and administered by the U.