Student Loan Forgiveness & Repayment Programs

A loan forgiveness programs has the Federal Government to back them up. With this program, if a student is able to fulfill specific criteria, a certain part of the loan amount or the entire amount payable, could actually be waived.

A student loan repayment program is set apart from a loan forgiveness program. Such program could be used to lessen any kind of loan. It allows the provision of additional funds, through which a student is able to pay back his loan. In some cases, the payment is directly made to the lender on behalf of the borrower.

Both programs are very helpful in student loan debt management. Nevertheless, the total amount deducted under such programs is deemed a taxable income. This could actually be discouraging, such programs are immensely advantageous, and carry more value than the tax incurred through them.

If you don’t want the repayments to be taxable, you better go for student loans that give forgiveness. However, you can only avail of this provision when you work with certain professions and for certain employers for a certain time period.

For instance, loan repayments under National Health Service Corps (NHSC) program are tax-free. Also, state programs that qualify for funding from the Public Health Services Act are considered tax-free.

Below are the institutions that give the option of reducing/eliminating student loans:

The American Federation of Teachers

The Association of Medical Colleges

The American Bar Association

AmeriCorps

Peace Corps

A student loan debt management program is a resourceful tool to cut back on debts. See to it that you avail of these benefits. Decide wisely. If you need additional provisions, go for the programs that offer them. There could be other expenses in the form of taxable income. Nevertheless, when you take a bigger view, the program will be far more profitable and will outweigh the costs incurred.