Student Loan Cancellation

Loans and Cancellations

Most of you would have defaulted on your loans and thought of how to get it either canceled totally or part of it canceled. This problem is not difficult as you think as there are different ways to get your loan canceled.

Loan repayment is always stressing for college students and as they struggle to find job in these economically troubled times in the UNITED STATES, only federal government may choose to cancel part or all of an educational loan. Student loan repayment is applicable to loans given by the federal GOVT like Stafford and Perkins loans.

If you participate in any of these programs, you can have your loan partially or wholly erased from your lender’s books. Student loan repayment programs are more widespread than forgiveness programs.

Checking to see if you Qualify for a Loan Forgiveness Program

Under certain circumstances you may have student loan forgiveness if you become permanently disabled since the last time you attended college. It will require that you were diagnosed as disabled and that your physician does not expect a full recovery or the ability to earn income. A statement must be signed by a doctor. Volunteers for VISTSA and the Peace Corps may have student loan forgiveness depending on the term of their commitment and hours of service. Military service, medical graduates, law students, and teachers in disadvantaged or rural areas may also qualify for loan forgiveness.

Determine what types of loans you received for your education. I you received a direct loan program; you may need to convert them

Find out how many monthly payments you have made since October 1, 2007. Most federal loan forgiveness  programs will require that make you 120 payments or it be 10 years from the date your loans were provided in order to be forgiven.

Contact your student loan forgiveness in order to request their application. Lenders often have different applications for the loan forgiveness. For most loan programs, you will need to provide proof of income, a letter from your employer or proof of income, a letter from your employer or proof that you are in military service, and information such as loan numbers, dates of your education, and other pertinent information.

Funding your education and after

Education is amongst the most important aspects of a child’s upbringing that parents do not mind covering that extra distance to provide their wards with excellent schooling. A firm foundation of education is what will determine the future of the man. For many this may seem “easy” but mind you, it is not. Quality education requires money and this is often obtained in the form of student loans from banks and other institutions. This is particularly high in the case of higher education.  Of course, the students themselves maybe unaware of this as the parents wouldn’t want their child to know the troubles they are going through to provide education but in a way it is best if he is told the same. This would give him the impetus to work something out for himself and take it upon him to settle student loans.

The student loan

There are many banks that offer you student loans or education loans. These loans attract an interest that is manageable as no bank would want to be known as a bank that does not support education with its high rates. However, the principal amount is dependent on various factors such as academic record and the institution of study. Most student loan repayment period would be a year or two after graduation when the student would be in a position to start repaying the amount.

Repaying the loan

A student can start saving even before getting a stable income. There are many odd jobs that employ students on a part time basis that would pay enough for one’s sustenance. This way, one can cut down on his expenses and route it towards the student loan repayment cache. Although during the repayment period, the installment amount is rather small, to allow the person to adjust to the new environment, this will soon grow a few notches. This is why having a buffer plan would help you in your repayment.


To avail the student loan, you would have to submit a few documents to the bank including past academic certificates, the offer letter from the institution of study as well as the fee structure that is being followed. If the course lasts for a few years, then the bank will not grant the entire amount; rather, it would release it as per the period given in the free structure.

Different Student Loan Repayment Grace Periods

If you have taken a student loan from a bank, you will be provided a grace period for repayment. If you finish your course today, you need to start repaying loan after six months, that is, after getting employed somewhere. It is a normal grace period provided by banks in general. But there are different grace periods for different student loans. Read full article for more…

What is a Grace Period?

A ‘grace period’ is defined as an allotted amount of time during which you need not make payments on your student loans after initially leaving school or dropping below half-time status. The period is normally six months to one year. It differs among banks and student loans taken.

Two Common Grace Periods

Two most common types of student loans that offer a grace period are:

Federal Stafford Loan, and Federal Perkins Loan

  • Federal Stafford Loan Grace Period: Stafford loan has a six-month grace period, irrespective of subsidy received. After six-month your Student loan will not be eligible to receive a new grace period in future. If you break your initial grace period by going back to school, to maintain at least half-time status in a qualifying course of study and file the appropriate student deferment form, you will be allotted another six-month grace period for your student loan repayment.

  • Federal Perkins Loan Grace Period: Federal Perkins Loan has a grace period for nine-month. If you break your grace period by going back to school, enroll in some courses to maintain at least half-time status in a qualifying course of study and submit the apt student deferment form, you will be allotted another nine-month as grace period for your repaying your student loan.

Benefits: Perkins loan will award you another six-month grace period at the time you exit. Another benefit is that every time you qualify for deferment, you will be granted a minimum six-month grace period following the end of deferment.

Other Student Loan Grace Periods

There are a variety of loans offered to students, like Regents Loans, Primary Care Loans, Dental and Health Profession Student Loans. To know the exact grace period for these loans you should follow the steps given below:

Step 1: Read your loan promissory note. If you misplaced your promissory note, go to step two.

Step 2: Contact the holder of your loan promissory note. The holder is known as the lender. He will provide you this information.

I hope you got a clear-cut idea about student loan grace periods. Thank you!

Reducing the Load on Repaying your Student Loan

Are you worried upon the repayment of your student loan? Sometimes you are having a difficult time in finding a good job and your bank is constantly demanding the repay of your loan. Don’t worry much; a few options are there which will assist you to mitigate the issue of student loan repayment.

However before making use of such facilities you should ensure that you aptly need those services essential to get your loan cleared. Here let’s see some of the options that make you manage the student loan repayment properly.

Guide to Easing the Process of Student Loan Repayment

These options are something like last resorts, particularly when you reach in a situation that you can’t find a good deal out for clearing your loan.

  • Student Loan Consolidation: You can opt for student loan consolidation, since these can lower your monthly payments and lock in a low interest rate. However, it is important to realize that consolidation can extend the life of your loan and greatly increase the amount of interest you pay.
  •  Unemployed Deferment: You are allowed to have three years of unemployed deferment on your student loans. You can take advantage of this deferment if you do not have a job. Since you are only allowed three years, you should be careful in considering your options before claiming deferment.
  • Economic Hardship Deferment: If you are employed in a low paying job, then you may qualify for economic hardshipdeferment. This is meant usually for a specified amount of time. Your lender will let you know how long you have. If you are eligible for this, take advantage of this opportunity to focus on changing your financial situation.
  • Forbearance: Forbearance is your final option when it comes to paying back your student loans. If you are having difficulty making your payments, then you need to contact your lender. They are usually willing to allow you to pay a lower payment, rather than put the loan into default. This should be your last option. It is important to be open with your lender, because they do want you to repay the money. By communicating with them when you have a problem, you can generally avoid being put into default on the loan.

New Government Programs to Provide Payment Relief!

With the skyrocketing cost of education coupled with an economy that has been sluggish at best, many graduating students are finding themselves unable to make their student loan payments. Realizing the nature of this growing problem, the US Government has created several programs to assist struggling students from defaulting on their student debt. There are now four programs available to take advantage of:

The Standard Repayment Program
The Graduated Repayment Program
The Income Contingent Program
The Income Based Repayment Program

These programs are designed to provide instant payment relief to those who qualify. The way it works is the Department of Education will actually pay off your student loans in full, which enables you to consolidate all of your federal loans into one new loan through the DOE. Your new payment will be determined based on your income and family size. The less you earn, the less your new payment will be.

Now one might think the interest will accrue and the loan will never be paid off. In theory that would be correct, and that’s where student loan forgiveness comes in. With the new loan obtained through the DOE, the maximum number of months you can be in the loan is 300 months, or 120 months if you work in public service. Regardless to what is left on the loan balance at the end of the term, the remaining balance will be forgiven.

The new loans being offered through the DOE are very flexible and designed to provide payment relief and loan forgiveness. Although you can apply for these new loans on your own, our company serves in the capacity to help you understand these options and assist in preparing the necessary paperwork in a streamlined manner.