Student debt loan forgiveness for people in public service

Many college graduates in Tennessee are struggling with student loan repayments, and you might be among them. Whether you have federal loans, private loans or some combination of the two, student loan debt has kept people from buying homes, starting businesses or even having children, to the extent that it has become a national issue of concern.

Is public service loan forgiveness for you?

One option that you may consider is public service loan forgiveness, a national program that makes it possible for some teachers, social workers, public servants and nonprofit employees to have their loan balances discharged after 10 years of paying their loans monthly and on time. However, the program has been plagued with problems.

Challenges in dealing with the program

In 2017, the Department of Education indicated that it had not made a decision on over 500,000 applicants’ paperwork, despite the fact that many of these people made life decisions based on the promise of loan forgiveness. However, in 2020, the DOE settled its lawsuit with the American Bar Association in which it first made those claims and agreed that ABA employees are entitled to loan forgiveness. This came after a court decision that stated that the DOE could not change the terms of the public service loan forgiveness plan retroactively.

One part of the debt puzzle

Public service loan forgiveness may be one part of dealing with the student loan debt trap, but it may not provide a total escape from the situation. After all, borrowers must still prove 10 years of on-time monthly payments, which can be deeply challenging if you are drowning in debt.

One of the reasons student loan debt has become such a national crisis is because it has been made very difficult to discharge student loans in bankruptcy. There have been efforts to change this, and some courts have been willing to consider a more flexible interpretation of the law. Other borrowers have found that Chapter 7 bankruptcy provides an opportunity to clear other significant debt that makes their student loan payments more manageable. Public service loan forgiveness, filing for bankruptcy and other options may all be worthy of consideration when dealing with massive student loan debt.

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