What Are the Requirements for Loan Forgiveness?

Loan forgiveness usually refers to the process of a lender canceling some or all of a borrower's debt on a student loan. The specific requirements for loan forgiveness depend on the program through which the borrower is qualifying for forgiveness. Plan ahead to make sure you meet all of the requirements for your program.

Public Service Loan Forgiveness

The most widely applicable type of loan forgiveness is the federal government's public service loan forgiveness program. To qualify, you must make 120 monthly payments on a federal Direct Loan while you are working full-time in any public service job. This includes health care, teaching, nonprofit work and many government positions. After making the payments, the government forgives all remaining balance on your loan.

Stafford Forgiveness for Teachers

The federal government forgives some Stafford loan debt for borrowers who work as teachers after graduating. To qualify, you must work full-time for five consecutive years as a teacher in an elementary or secondary school that qualifies as low-income under the federal guidelines. After you complete your five years, the federal government forgives up to $5,000 of Stafford loan debt for most borrowers. If you worked as a special education teacher or a secondary math or science teacher, the government will forgive up to $17,500 of Stafford loan debt.

Perkins Forgiveness for Teachers

Teachers can also have their Perkins loans partially or fully forgiven, depending on how many years they teach. The federal government forgives 15 percent of the loan after each of the first two years, 20 percent after each of the next two years and the last 30 percent of the loan after the fifth year of teaching. To qualify, you must teach full-time in a low-income school, a special education position or a subject area that has a shortage of teachers in your state.

Private Programs

Many states and individual employers or agencies related to employment in a particular field offer loan forgiveness. For example, some state nursing boards forgive loans for nurses who work in the state for a specific number of years. Borrowers who go on to careers in legal work, the military or community organizations might also be able to benefit for loan forgiveness. Ask your employer about forgiveness programs for workers in your field and contact the appropriate agency to find out specific requirements.