The federal programs that can cancel your student debt

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Depending on your loan type and career, there are a number of forgiveness programs available to federal borrowers, ranging from income-driven repayment (IDR) plan forgiveness to Public Service Loan Forgiveness (PSLF).

But unlike President Joe Biden’s widespread plan—which would forgive up to $20,000 for most federal borrowers via an online application—these plans typically require borrowers to make payments for several years before they can apply to have the rest of their balance waived. And those application processes can be complicated. Private student loan debt isn’t eligible for cancelation.

While borrowers welcome the relief, the many different programs and plans can make the process a little confusing. Here’s a break down of some of the most significant loan forgiveness efforts.

Income-driven repayment forgiveness

An IDR plan bases a borrower’s monthly bill on their income and family size rather than just the amount they owe. Payments are capped at a percentage of their monthly income, making it attractive to lower earners with high debt balances. After 20 to 25 years of repayments, depending on the repayment plan, the remainder of the balance is eligible for forgiveness.

Very few people have actually received forgiveness through this track, according to the National Consumer Law Center. But the Biden administration is instituting a number of changes to these repayment plans to make it easier to actually attain relief.

Starting sometime this year, some borrowers who have made loan payments for at least 20 years will automatically have the rest of their debt discharged. This will also include months borrowers were in forbearance, which weren’t previously counted. The Education Department is adjusting accounts to reflect all months in repayment, regardless of loan type or repayment plan. It is also counting some periods of forbearance and deferment toward the total needed to qualify.

This is the result of a one-time waiver the Biden administration offered in 2022, but the Education Department delayed implementing it. Millions of other borrowers will receive additional payment credits toward the total they need to receive forgiveness.

Additionally, the Biden administration has also released changes to IDR generally that will benefit borrowers going forward.

Under the new rules, the program would be simplified and restructured, making it easier to have balances forgiven. The Education Department estimates this will result in the average borrower paying 40% less during their lifetime. Most borrowers qualify for these plans. Education experts view these changes as potentially more helpful for borrowers than the one-time forgiveness effort.

Public Service Loan Forgiveness

The PSLF program forgives a borrower’s student loan debt balance after they’ve made 10 years of on-time payments while working a public service job, such as a teacher, police officer, or government worker.

The program has experienced a number of high-profile challenges over the years. But the Biden administration has also made a number of changes to simplify the application process, including simplifying eligibility requirements.

PSLF was also part of the one-time waiver, and more than 450,000 borrowers were approved for forgiveness under that program through early February 2023, according to the Education Department. Others are still waiting.

Those who qualify need to fill out an Employment Certification Form each year. Once you’ve made the required 120 qualifying payments, you can submit a PSLF application.

Teacher and Nurse loan forgiveness

There are also programs for specific careers, like teaching and nursing.

While many teachers can qualify for PSLF, they may also be eligible for the Teacher Loan Forgiveness program. Under this program, borrowers with federal Direct or Stafford loans who teach for five consecutive academic years in a low-income school or educational service agency can get up to $17,500 in relief. It’s less generous than PSLF, so be sure to research all of the requirements and compare the programs to see what’s best for your situation.

Nurses also have their own forgiveness program, called the Nurse Corps Loan Repayment Program. Under this program, those who work in a hospital or clinic with a critical nursing shortage may be able to get a percentage of their loans forgiven. Given the requirements, though, many nurses opt for PSLF.

Additionally, some nurses and teachers—as well as other professionals like firemen—may qualify for Perkins Loan Forgiveness after five years.

Other forgiveness efforts

In addition to announcing the widespread forgiveness plan and changing PSLF and IDR forgiveness, the Education Department has also been discharging the debt for millions of students defrauded by the schools they attended, as well as the debt of those who are disabled.

And, while it isn’t technically forgiveness, federal student loan payments have been paused for over three years since the start of the COVID-19 pandemic. For those aiming for PSLF forgiveness, though, the months of the pause—now over 36—count toward the total number of payments they need to qualify for forgiveness.

Status of widespread forgiveness

The Supreme Court is set to announce the outcome of the legal challenges against the president’s signature forgiveness plan in the next few weeks. Many borrowers’ financial lives and decisions hinge on whatever the justices decide.

Some say having some or all of their student loan debt forgiven would help them reach other financial goals, like saving for homes or retirement, while others stress the peace of mind it could provide. Others tell Fortune they are putting off having children because of the financial toll.