Student Loan Forgiveness And Forbearance Update 

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Student Loan Forgiveness And Forbearance Update

If you’re having a hard time keeping track of all of the student loan updates that have been occurring over the last few months, you’re not alone.

While these changes can help many physical therapists and occupational therapists obtain student loan relief much faster, they have been difficult to keep track of. Unfortunately, this can make it more difficult for student loan borrowers like you to actually benefit from these opportunities.

That’s why I’ve been doing my best to keep physical therapists, occupational therapists, and students like you all updated by writing articles such as this one: Public Service Loan Forgiveness Waiver.

Today’s article will also aim to help occupational therapists, physical therapists, and students obtain student loan forgiveness more quickly by covering a recent announcement on a different aspect of student loans: Forbearance. 

Let’s get started.

What’s The Update?

On April 19, 2022 the Department of Education announced an update regarding student loan forgiveness and forbearance.

More specifically, if you meet one of two options, then the months that you spent in forbearance will now count towards student loan forgiveness via either Income-Driven Repayment Plan forgiveness or Public Service Loan Forgiveness.

Before we get into these two options, we should first go over what forbearance is so that you have a better understanding on whether you qualify for this new opportunity.

What Is Student Loan Forbearance?

Placing your student loans in forbearance means that you are being allowed to forgo making the required payments towards your student loans. Instead, you may be allowed to make smaller payments or potentially avoid making payments altogether. This arrangement is not meant to be permanent, though.

There are two different categories of forbearance.

1. General Forbearance

You can apply for a general forbearance if you are unable to make your required student loan payments due to difficult financial circumstances.

Student loans that qualify for forbearance include Direct Loans, FFEL Program loans, and Perkins Loans.

A general forbearance may not last longer than 12 months and, although you can reapply for additional months, the total number of months allowed is capped.

You can learn more about a general forbearance by reading the General Forbearance Request Form.

2. Mandatory Forbearance

Unlike a general forbearance, a mandatory forbearance must be provided if you meet the requirements to obtain one.

The Federal Student Aid website lists several examples where a mandatory forbearance will be given. 

You can learn more about it by reading the Mandatory Forbearance Request Form.

Qualifying For The April 19, 2022 Forbearance Update:

Now that you have a better handle on what forbearance is, let’s go over how the April 19, 2022 Forbearance Update might be helpful to you obtaining student loan forgiveness faster. 

Physical therapists and occupational therapists who had their student loans in forbearance for a period of time and meet one of the two options below can qualify for faster loan forgiveness:

Option #1: Consecutive Months In Forbearance 

This first option allows you to have the months that you spent in forbearance all be counted towards loan forgiveness if the total number of months in forbearance was as least 36 months.

If, for example, you only had 35 months of forbearance, then those 35 months will not count towards loan forgiveness. 

If you don’t qualify under this first option, see if you qualify for the second option below. 

Option #2: Number Of Months In Forbearance

If you had your loans in forbearance for at least 12 consecutive months, then those months can now count towards loan forgiveness.

Therefore, unfortunately, if you were in forbearance for only 11 consecutive months, you would not qualify to have those 11 months count towards student loan forgiveness under this condition. 

What If I Was In Forbearance But I Don’t Meet These Criteria?

The Department of Education recommends that you file a complaint with the office of Federal Student Aid’s ombudsman.

How Do I Make Sure These Months Are Counted Towards My Loan Forgiveness?

When the Department of Education announced this update, they also stated that these newly counted months will automatically show up on these student loan accounts later this year. 

Final Thoughts. . .

Stay tuned: If the federal government announces any other student loan updates I will be sure to keep you informed.