Can I Get My Student Loans Forgiven for Staying at Home With the Kids?

Can I Get My Student Loans Forgiven for Staying at Home With the Kids?
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Student loan debt is a significant issue in the United States, and many people must explore forgiveness programs. Is there a stay-at-home-mom student loan forgiveness program? There is no specific loan forgiveness program for parents who remain home to parent their children. However, other programs exist that some stay-at-home parents may be able to utilize for loan forgiveness.

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Stay-at-Home Mom Student Loan Forgiveness Program Options

In response to the mounting burden of student debt on so many young Americans, the Department of Education and the federal government have established several paths to student loan forgiveness that are open to stay-at-home parents. They include the income-based repayment plan, pay-as-you-earn plans, income-driven plans and income-sensitive plans. As the U.S. Department of Education's Federal Student Aid branch mentions, most of these programs are income-based. Even if you do not work, if your spouse makes more than a certain amount (depending on your family size), you might not qualify.

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To apply, you'll need to submit your income information, including your most recent tax returns, to the Department of Education. You must also submit data about your living expenses, such as your rent or mortgage statements and any public welfare services you receive.

You agree to make minimum monthly payments for 20 or 25 years when participating in these programs. These payments take your family size, income and expenses into account and establish a reasonable amount for you to pay. At the end of the 20 or 25 years specified by the program, any remaining debt, including accrued interest, is forgiven. You must submit your application annually to renew or your payments will revert to the standard plan.

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Jobs That Qualify for Student Loan Forgiveness

If you decide to enter the workforce, you'll want to consider the Public Service Loan Forgiveness (PSLF) program. This program allows individuals who work for the government, nonprofits or related fields to have their student debt wiped clean after 10 years of service. Working directly for the government is one option. You can work in virtually any department or level of government (federal, state, county, municipality and so on) and any position (from mayor to janitor) to qualify.

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Many educators also qualify for PSLF. Anyone teaching or working in a public school will almost certainly qualify for PSLF. In addition, university instructors at public universities (including community colleges and state schools) are eligible, as are preschool teachers who teach Head Start or other public programs. Nonprofit agencies also qualify for loan forgiveness. You must work full time for a 501(c)(3) company to qualify for the nonprofit agency-based PSLF; part-time work does not apply.

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Other Student Loan Options to Consider

For parents who either stay home or work from home, options are more limited. You must be employed full time to qualify for most of these programs, so parents would undoubtedly need help with child care.

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Be aware that your forgiveness might be canceled if you default on any payments. Also, periods of deferment (even in-school deferments) do not qualify for your forgiveness timeline. Even the automatic suspensions during the COVID-19 pandemic do not qualify for forgiveness.

In most cases, declaring bankruptcy should always be the last-resort option. Even if you're to the point of considering bankruptcy, it's worth noting that student loans aren't automatically canceled in bankruptcy settlements. The Consumer Financial Protection Bureau provides additional details about what student loans can and can't be canceled during bankruptcy. If you find that you're having trouble paying your student loans and other bills, you can consider deferring payments due to economic hardship or working with the loan provider to decrease your monthly payment.

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