Student Loan Forgiveness in the United States.
While forgiveness of student loans is straightforward in Canada, it isn’t in the U.S. In the States, student loan repayment programs are more common than forgiveness programs.
Forgiveness is industry specific. There are programs available to teachers, the medical and legal professions, and to volunteer workers. If you don’t work within one of these industries it’s best to check with your Human Resources Dep’t to see what options are available to you.
In the case of loan forgiveness, a portion of your debt is wiped clear. In the case of loan repayment, which applies to both federal and privately funded loans, you can receive additional funds to put toward your principle, or your employer may make a payment on your behalf to the lender. Again, check with your HR to see what is available to you.
Student Loan Forgiveness in Canada
HRDC (Human Resources Development Canada) offers a variety of programs.
Available if you are unable to make your student loan payments due to unemployment or low income, and is available for a period of six to thirty months. However, there are restrictions and exceptions. During that time you do not have to make either interest or principle payments. The government covers it for you.
While on Interest Relief, if you are able, you are free to make voluntary payments. If you do, these payments are applied directly to your outstanding principle amount. These payments will not impact your current or future eligibility in the program.
This program is available to those facing long term financial difficulties. Using your family income to arrive at an amount, your principle is lowered, reducing your monthly loan payment to a more affordable level. Be aware that provinces and territories also offer repayment assistance, so check to see what is available to you locally.
Throughout your lifetime, you are eligible to three reductions in your student loan principle to a maximum of $26,000, depending on your financial circumstances.
There is a lengthy list of qualifiers to this program, so be sure you make sure you’re eligible.
With this program you can adjust the original terms of your loan. Depending on your situation, you may want to decrease your monthly payments by extending your repayment period from ten to fifteen years. Or, you can increase your payments and repay your loan faster.
Available to those who have a permanent disability, but difficult to obtain. The eligibility criteria varies based on date of loan negotiation and lender.