The student loan forgiveness programs are discharge, cancellation or forgiveness of debts, which undergraduate and graduate students have taken to pay a massive amount of college fees. In the United States, there are many forgiveness plans available to apply for the borrower students, but prevalent issue among student loan forgiveness application requested borrowers is get rejected out of the program. Some students experience difficulties while filling the application, and others do not pay attention to the necessary details, some part of applicants makes negligible mistakes, etc. There are some possible known reasons of that rejection, and in this article, you can find essential information about student loans, ways not to get rejected from student loan forgiveness application, best student loan plans, benefits of student loans, and so on.
What are the student forgiveness programs?
It means that the program helps to get cancellation, discharge, and forgiveness for student loans by the government. After that borrowers no longer need to repay rest of their debt to a college, or a credit issued institution. If a borrower does not request to refund residue of his or her loan because of job status, then it is forgiveness and cancellation. In contrast, discharge means that borrower does not pay the remainder of the loan, due to closure or bankruptcy of the high education institution, in case of permanent or total disability of a loan taker, and other circumstances. If the student had signed a promissory contract when he or she had taken a student loan, then they have to bear responsibilities of the note and pay the credit, but in some instances, the student loan forgiveness application is open to them.
This type of forgiveness are the following:
- Public service loan forgiveness is for former students who currently work as public sector workers such as nurses, non-profit organization volunteers, etc.
- Teacher loan forgiveness is for former pedagogical students;
- Total and permanent disability discharge;
- Death and bankruptcy discharge;
- Closed college discharge;
- False certification, and unauthorized payment, and signature discharge.
Besides these, student loan taker can apply for forgiveness program in case of misleadings, or violations of school. Also, there are some rare circumstances that students are available for these programs.
What are the ways against rejection?
The very general threat of the borrowers who apply for the student loan forgiveness application is a high probability of getting the loan rejection. Statistics show that there are more than 44 million student loan borrowers in the United States who has a total debt amount of approximately 1.5 trillion, and last year only one percent of them get acceptance. The results demonstrate that this could occur due to misinformation, and other issues. Forbes writes that 99 percent of forgiveness applicants get rejected in 2018. About 70 percent of those applicants get dismissed due to not meeting with the eligibility criteria of the program. Some claims that it happens intentionally to save money. Of course, competence rate is high enough. So, what are the reasons and ways not to get rejected?
The following steps are the most important for that purpose:
- Find an appropriate forgiveness program, read all requirements of eligibility for the applied program carefully, and do not forget to check the availability of your documents and certificates for the chosen application. Check, and make sure whether your condition meets the requirements or not, for instance, public service loan forgiveness program has a criteria that applicants have to pay at least 120 payments, if you have not done this as an insufficient payments, do not waste your time to apply, it is evident that you 99 percent get rejected. You should pay these installments before you ask for the Public Service Loan Forgiveness program.
- Do not send an Employment Certification Forms with mistakes. Errors sometimes are inevitable but do not mind that that is important, and check all stuff before submitting it. The information on the current form must be the same as the previous one without mismatching. Every detailed data have to be added, such as the zip code and address of the workplace. The application form must be complete, without any blank areas. All errors have to be fixed, and first letters of applicant’s name and surname must be added next to corrected errors.
How to avoid rejection
- If you had applied for the wrong repayment plan, you probably get rejected. That is one of the causes of several rejections, and are among “excuses” of the Department. For example, only the federal government’s direct loans are considered eligible for the Public Student Loan Forgiveness program.
- Every time fill all areas Employer Certification Form before you fill student loan forgiveness application, do not leave it uncompleted, pay attention to details. You have to submit the date of your first employment, duration of the job, the name of the employer, switches you have made, annual salary, etc.
- Always make sure that an authorized person signs your all necessary documents, such as employment certification form, for example, chief executive officer of your company.
- You should enroll a repayment plan for the last ten years. Even it would better to consolidate loans in case you have had different repayment plans. There so many consolidation offering banks in the US you can ask for them.
- Your yearly income is also checked, for that purpose certify your annual salary each year on studentloans.gov, which is the federal government’s site. It is better to review any new information, and refresh your application.
- Be careful with any paperwork errors on your documents. Do not do any misleading misspelling, incomplete information. Twenty-eight percent get rejected due to that reason.
What are the best repayment plans?
There are the best repayment plans you should know them before filling your student loan forgiveness application. Although the Trump administration wants to combine all these plans under one, that is still a proposal.
- Income-based repayment requires to pay 15 percent of debt till the application. Then you will have 15 or 25 years to spend rest of your loan, depending on your are a master or bachelor student. Annual or monthly payments will be structured based on your income.
- Pay as you earn repayment is for direct federal loan taker, and subsidized and unsubsidized FFEL debts. It is almost the same with income based. You have to pay your debt for 25 years, and rest will be calculated as a tax.
- Public service loan forgiveness. Direct consolidated, grad plus, subsidized and unsubsidized loans are possible to be forgiven by the PSLF. As mentioned above, this plan is for federal, or state public workers.
- Income-contingent repayment requires to pay 20 percent of your debt while following 25 years.
- Teacher forgiveness is also applicable by the teacher as well as Parkins and the PSLF.
- Military student loan forgiveness is for former members of armed forces, military servants, and doctors.
- Obama loan forgiveness was created during the Obama administration. It was available for loans that have been taken after 1st October of 2017.
Student loan forgiveness application is quite remarkable, and you should be careful every step of the process. The most important thing is to research and find the best student loan repayment and forgiveness program suitable for you. Later, during your fill application, try to benefit given advice.