FFELP Loan Forgiveness Program

FFELP loan forgiveness is a program designed to relieve borrowers who have made consistent loan repayments over an extended period. After 20 years of qualifying payments, borrowers may be eligible for forgiveness of their remaining loan balance. This can be a significant advantage for those struggling with student loan debt.

The Federal Family Education Loan Program (FFELP) was a government-backed loan program from 1965 to 2010. Under this program, private lenders, such as banks and credit unions, provided loans to students and parents to finance education expenses. These loans included Stafford loans, PLUS loans, and consolidation loans.

FFELP Loan Forgiveness after 20 Years

FFELP loan forgiveness after 20 years of repayment is a significant milestone for borrowers who have diligently made regular monthly payments on their FFELP loans. The forgiveness after 20 years program offers the opportunity to completely forgive the remaining loan balance, providing substantial relief from the burden of student loan debt.

To qualify for FFELP loan forgiveness after 20 years, borrowers must meet specific requirements. First and foremost, you must have made 240 monthly payments (equivalent to 20 years) on your FFELP loans. These payments must be made in full and on time, without any periods of delinquency or default. It’s important to note that only payments made after October 1, 2007, are counted towards the 240-payment requirement.

FFELP loan forgiveness program

Furthermore, to be eligible for forgiveness, you must have been employed full-time during the entire 20-year period. Employment with a qualifying employer is necessary, which typically includes government organizations, nonprofits, and other public service entities. Working in a qualifying field or profession is not required for this forgiveness program.

Other FFELP Loan Cancellation Options

In addition to the 20-year forgiveness program, borrowers with FFELP loans may have the opportunity to qualify for loan cancellation under specific circumstances. These cancellation options relieve the loan obligation in situations such as permanent disability, death, school closure, false certification, and unpaid refunds. Understanding these cancellation options and their requirements is crucial for borrowers facing such circumstances.

Permanent Disability Discharge

Borrowers who experience a total and permanent disability may be eligible for FFELP loan cancellation through the Permanent Disability Discharge (PDD) program. To qualify for this cancellation option, you must provide documentation from a qualified physician certifying your disability. The certification should state that you cannot engage in any substantial gainful activity due to a physical or mental impairment that is expected to result in death or has lasted or is expected to last for a continuous period of at least 60 months.

Once your disability discharge application is approved, the remaining balance of your FFELP loans will be cancelled, and you will no longer be obligated to make further payments. It is important to note that this cancellation option is only available for borrowers with total and permanent disabilities.

Death Discharge

In the unfortunate event of the borrower’s death, FFELP loans may be eligible for cancellation through the Death Discharge program. When the loan servicer receives reliable documentation, such as a death certificate or other acceptable proof of death, the remaining balance of the deceased borrower’s loans will be discharged.

The borrower’s family members or estate representatives must notify the loan servicer promptly to initiate the Death Discharge process. This cancellation relieves the borrower’s family from repaying the loans after their passing.

School Closure Discharge

If the school you attended closes while you are enrolled or shortly after you withdraw, you may be eligible for FFELP loan cancellation under the School Closure Discharge program. This cancellation option applies to borrowers who cannot complete their program of study due to the closure of the educational institution.

To qualify for School Closure Discharge, you must have been enrolled at the time of the school closure or have withdrawn within 120 days before the closure. If you meet the eligibility criteria, you may need to provide documentation, such as transcripts or other school records, to support your cancellation application.

False Certification Discharge

Suppose your school falsely certified your eligibility for FFELP loans. In that case, you may be eligible for loan cancellation through the False Certification Discharge program. False certification may occur if your school falsely certified your ability to benefit from the education or if they falsely certified your eligibility for a specific profession due to a physical or mental condition, age, criminal record, or other factors.

To apply for False Certification Discharge, you must submit a detailed explanation of the circumstances and provide any supporting evidence that demonstrates the school’s false certification. If your cancellation application is approved, the loans obtained due to the false certification will be discharged.

Unpaid Refund Discharge

Suppose your school fails to pay a refund owed to the U.S. Department of Education or the loan servicer within the required timeframe. In that case, you may be eligible for FFELP loan cancellation through the Unpaid Refund Discharge program. This cancellation option applies if you withdrew from the school and did not receive the educational services you paid for.

To qualify for Unpaid Refund Discharge, you must submit an application and provide documentation to prove that you withdrew from the school and have yet to receive a refund of the required amount. The cancellation will apply to the loans associated with the unpaid refund.

Qualifying for FFELP Loan Forgiveness

To qualify for FFELP loan forgiveness, you must meet certain criteria. Generally, borrowers must have made 240 monthly payments (20 years) on their loans while working full-time for a qualifying employer. Qualifying employers include government organizations, nonprofits, and other public service entities. Ensuring you fulfil all the eligibility criteria before applying for forgiveness is crucial.

How to Apply for FFELP Loan Forgiveness

Applying for FFELP loan forgiveness is an important step towards relieving the burden of student loan debt. To ensure a smooth and successful application process, it is essential to understand the requirements and gather the necessary documentation. Here’s a step-by-step guide on how to apply for FFELP loan forgiveness:

Step 1: Understand the Requirements

Before beginning the application process, familiarize yourself with the specific requirements for FFELP loan forgiveness. Each forgiveness program has its own eligibility criteria, such as making a certain number of qualifying payments, working in a specific field, or meeting other program-specific requirements. Review the guidelines and determine which forgiveness program you qualify for.

Step 2: Contact Your Loan Servicer

Contact your loan servicer, the entity responsible for managing your FFELP loans. They can provide personalized guidance and information about your forgiveness options. They can also answer questions regarding the application process, required documentation, and deadlines. When contacting them, be sure to have your loan details, such as your loan account number.

Step 3: Gather the Required Documentation

You must gather the necessary documentation to support your FFELP loan forgiveness application. This typically includes:

  • Payment Records: Compile records of all your loan payments, including dates and amounts paid. These records will demonstrate that you have made the required qualifying payments.
  •  Employment Certification: If your forgiveness program requires full-time employment with a qualifying employer, such as a government organization or nonprofit, you must submit employment certification forms. These forms verify your employment status during the qualifying period.
  •  Loan Details: Have your loan details readily available, including the types of loans you have, their current balances, and any other relevant loan information.

Step 4: Complete the Application Forms

Obtain the appropriate application forms for the forgiveness program you are applying for. These forms can usually be found on the official government websites or obtained from your loan servicer. Carefully read the instructions and fill out the forms accurately and completely. Double-check all the information to ensure its accuracy.

Step 5: Submit Your Application

Once you have completed the application forms and gathered the required documentation, submit your application to the designated address or online portal specified in the instructions. Be mindful of any deadlines and ensure that you have included all the necessary supporting documents. Please send your application via certified mail or a secure online submission method to track its progress.

Step 6: Follow Up and Stay Informed

After submitting your application:

  1. If necessary, keep track of its progress and follow up with your loan servicer.
  2. Stay informed about any updates or requests for additional information.
  3. Be patient, as the review process may take time.

It’s essential to promptly respond to any communication from your loan servicer to ensure a smooth and efficient application review.

FFELP loans

Common Misconceptions about FFELP Loan Forgiveness

Several things could be improved surrounding FFELP loan forgiveness. Some borrowers mistakenly believe their loans are automatically forgiven after 20 years without any application process. However, it is essential to understand the steps involved and actively pursue forgiveness by submitting the required documents. Being aware of these misconceptions can help borrowers make informed decisions.

The Impact of FFELP Loan Forgiveness on Credit Scores

Many borrowers need help with the impact of loan forgiveness on their credit scores. Fortunately, FFELP loan forgiveness does not negatively affect credit scores. When loans are forgiven, the forgiven amount is not reported as income, thereby avoiding any potential credit score ramifications. However, consulting with credit experts or financial advisors is recommended to understand the full implications of loan forgiveness.

Tax Implications of FFELP Loan Forgiveness

FFELP loan forgiveness can have tax implications. In general, forgiven loans are considered taxable income by the IRS. This means that the amount forgiven may be subject to federal income tax. It is crucial to consult with tax professionals or seek guidance from the IRS to determine the tax consequences of FFELP loan forgiveness in your specific situation.

Alternatives to FFELP Loan Forgiveness

If you do not qualify for FFELP loan forgiveness or seek alternative options, various alternatives are available. These alternatives include loan consolidation, income-driven repayment plans, and refinancing options. Each option has pros and cons, so it is essential to research and evaluates which alternative aligns best with your financial goals and circumstances.

The Future of FFELP Loan Forgiveness

With the discontinuation of the FFELP program in 2010, loan forgiveness options for FFELP borrowers have become limited. However, policy changes and new legislative proposals may impact the future of FFELP loan forgiveness. Staying informed about potential developments can help borrowers make informed decisions regarding their student loan repayment strategies.


In conclusion, FFELP loan forgiveness offers hope for borrowers burdened with student loan debt. By understanding the program’s requirements, eligibility criteria, and application process, borrowers can take proactive steps towards achieving loan forgiveness. It is essential to stay informed about updates and changes in loan forgiveness policies and explore alternative options when necessary. Remember, financial freedom is within reach, and FFELP loan forgiveness can be a significant step in the right direction.

Frequently Asked Questions

FAQ 1: Can I apply for FFELP loan forgiveness before 20 years?

No, the standard FFELP loan forgiveness program requires borrowers to make 240 monthly payments (equivalent to 20 years) before becoming eligible for forgiveness. However, other cancellation options are available for specific circumstances, such as permanent disability or death.

FAQ 2: Are FFELP loans the same as Direct Loans?

No, FFELP loans and Direct Loans are different. FFELP loans were issued by private lenders, while Direct Loans are funded directly by the U.S. Department of Education. However, both types of loans may offer similar forgiveness and cancellation options, depending on the borrower’s circumstances.

FAQ 3: What happens if I default on my FFELP loans?

Defaulting on FFELP loans can have severe consequences. It can result in wage garnishment, damage to your credit score, and legal action by the loan servicer or collection agency. It is crucial to contact your loan servicer immediately if you are facing financial difficulties to explore alternative repayment options and prevent default.

FAQ 4: Do I need to be employed in a specific field to qualify for FFELP loan forgiveness?

FFELP loan forgiveness does not require borrowers to be employed in a specific field. However, to qualify for forgiveness, borrowers must work full-time for a qualifying employer, which includes government organizations, nonprofits, and other public service entities.

FAQ 5: Can I transfer my FFELP loans to the Direct Loan program?

It is possible to consolidate FFELP loans into a Direct Consolidation Loan. Consolidation allows borrowers to combine multiple loans into a single loan with a fixed interest rate and access to additional repayment options. However, it is crucial to evaluate the implications of consolidation before proceeding.

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