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Home > Ask The Get Out of Debt Experts > Has the Obama Student Loan Forgiveness Program Been Approved Yet? – Kelly

Has the Obama Student Loan Forgiveness Program Been Approved Yet? – Kelly

“Dear Steve,

Hi Steve,

I Came across your site by accident and I’m glad I did.

I have student loans that are 24years old and in default. Due to hardship and illness over the years I have not been able to pay them. I went to an attorney for free advice and found that school loans are not covered under bankruptcy any longer. She said many people have tried to claim hardship, illness etc to have their loans dismissed. According to her it is almost impossible—bottom line they want their money and don’t care about your circumstances. I didn’t know what to do and lost all hope of clearing this debt.

Is the Obama Student Loan Forgiveness Program still in the air or has this been approved?

I don’t know the particulars about this loan forgiveness program and would like to know if it would help someone like me. I’m unemployed and unable to pay them. Family offered to help me if the amount could be reduced to where they could afford to pay it off completely. Most of what I owed was due to interest, around $20k. A lawyer representing the school contacted me and was willing to work out a settlement with them. He could see my situation was not good and went back and forth with the institution.

In the end the school would not cooperate and wanted the full amount which my family could not afford. This is really ashame, because the debt could have been rectified. My father wanted to help me before he passed away, so I could go on with my life and not bear this burden. He died 2 years ago. I suffer from long term illness and have not been able to hold a job for very long. I have no money and would appreciate your help.

thank you,

Kelly”

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The Answer

Dear Kelly,

Are your student loans government backed or private loans? It makes a big difference.

Right now there is no Obama Student Loan Forgiveness Program but there is an Income Based Repayment Program for people to repay a lesser amount on government backed loans.

Also, if you can prove you are disabled there are forgiveness programs available, again for government backed loans.

What kind of loans do you have?

Big Hug!

Has the Obama Student Loan Forgiveness Program Been Approved Yet?   Kelly
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About Steve Rhode

Steve Rhode
Steve Rhode is the Get Out of Debt Guy and has been helping good people with bad debt problems since 1994. You can learn more about Steve, here.
  • Anne Taparauskas

    Thirty one years ago I was studying to be a chiropractor. I began to make bad grades and decided that I couldn’t make it. The loan that the school called me in to offer me, and had me sign at that time was a HEAL loan. I got further and further into debt. With the interest on this debt, I have never been able to get out of it. I have paid my other bills and make payments on this bill, but it stays exhorbitant, because it has such high interest. I was told by an attorney that it is not possible to bankrupt on this debt, nor have the interest lessened. I was so depressed because I never had enough to pay it off.

  • http://www.thomfox.com Thomas Fox

    Hello, this may not be applicable to the situation outlined here, but there are certain circumstances in which the federal government will cancel all, or part, of an educational loan. To qualify for such forgiveness you must:

    Perform volunteer work;
    Perform military service;
    Teach or practice medicine in certain types of communities; or,
    Meet other criteria specified by the forgiveness program.

    These, and other criteria, were created by the College Cost Reduction and Access Act of 2007. Essentially, the program discharges any remaining debt after 10 years of full-time employment in public service.

    According to FinAid, “Public service jobs include, among other positions, emergency management, government (excluding time served as a member of Congress), military service, public safety and law enforcement (police and fire), public health (including nurses, nurse practitioners, nurses in a clinical setting, and full-time professionals engaged in health care practitioner occupations and health care support occupations), public education, early childhood education (including licensed or regulated childcare, Head Start, and State-funded prekindergarten), social work in a public child or family service agency, public services for individuals with disabilities or the elderly, public interest legal services (including prosecutors, public defenders and legal advocacy on behalf of low-income communities at a nonprofit organization), public librarians, school librarians and other school-based services, and employees of tax exempt 501(c)(3) organizations. Full-time faculty at tribal colleges and universities, as well as faculty teaching in high-need subject areas and shortage areas (including nurse faculty, foreign language faculty, and part-time faculty at community colleges), also qualify.”

    Also, the borrower must be employed full-time in a public service job for each of the 120 monthly payments.

    • ann w

      Thomas,
      Thanks for the info. Wondering where I would go to apply for this possible forgiveness program?
      thanks, Ann

      • http://GetOutOfDebt.org Steve Rhode

        Ann,

        There is no Obama Loan Forgiveness program yet. However the Income Based Repayment (IBR) program that already exists is very close to it.

        Steve

  • Kelly

    Hi Steve,

    Thank you for getting to my question so quickly. My loans were GSL [guaranteed student loans]. Eventhough I’ve been ill, I don’t fall under the guide lines of being disabled. The attorney I talked to about my situation, said it is very difficult for school loans to be dismissed and told me there are those on Social Security benefits that still have to pay. It’s so disheartening. Thank you for the hug and the link, which I will certainly view. Any further assistance you can give me in this matter would be greatly appreciated.

    thank you so much,
    Kelly

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