So if My Student Loans Were in Forbearance They Should Be Forgiven?


Dear Steve,

I graduated from college in 1998, and my loans have been in and out of forbearance (mostly forbearance), just accruing more and more interest.

Thanks for sharing the information on the latest Dept. of Education announcement regarding forbearance steering relief. So, in theory, if someone has loans in both repayment and forbearance (mostly forbearance, though) for 20+ years, could the entire balance be wiped out? Is that how this would work?



Dear Melissa,

It doesn’t matter which political administration is in office; often, bold announcements lack specific details.

The recent announcement on forbearance steering on federal student loans offers hope.

There is no doubt that federal loan servicers frequently and routinely steer borrowers into forbearance rather than assist them with more appropriate ways to deal with their federal student loans.

The Department of Education said, “A review of past forbearance use shows that long-term use of forbearance was rampant. More than 13% of all Direct Loan borrowers between July 2009 and March 2020 have used forbearance for at least 36 months cumulatively.”

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From the announcement, a review of credit towards an Income-Driven Repayment plan will happen automatically, “These changes will be applied automatically to borrowers’ accounts later this year. To mitigate the harms of inappropriate steering into long-term forbearance, FSA will conduct a one-time account adjustment that will count forbearances of more than 12 months consecutive and more than 36 months cumulative toward forgiveness under IDR and PSLF.”

However, you will be able to make your case you were incorrectly steered. In addition, borrowers who were driven into shorter-term forbearances will be able to seek account review by filing a complaint with the FSA Ombudsman at StudentAid.gov/feedback.

There is no way to forecast the outcome of this reassessment, but I would guess it will be more favorable if you were already enrolled in one of the Income-Driven Repayment programs shown here.

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If you were not previously enrolled in an Income-Driven Repayment (IDR) program, the current Biden Department of Education would be the most suitable time to make your case you were never encouraged to enroll in an IDR by filing a complaint with the FSA Ombudsman at StudentAid.gov/feedback.

It would be best to fight hard for credit of forbearance payments towards an IDR repayment plan. I’m not saying there won’t be obstacles or bumps in the process, but right now, the Department of Education pursues every reason to grant forgiveness. Don’t miss out. Fight for your forgiveness. Who knows what the next administration will do.

Please come back and update me with your progress by posting a comment below.

Damon Day - Pro Debt Coach

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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.
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