Is Federal Student Loan Forgiveness After 20 Years Possible? (2024)

After paying down your student loans for months on end, it can be demoralizing to see just how large a balance you still have left. Depending on your repayment plan, you may even owe more now than you did when you first graduated.

The good news is that student loan payments don’t have to go on forever. If you have federal student loans and are making payments under an income-driven repayment (IDR) plan, you may be able to have your loans forgiven after 20 years. That can give you hope and a tangible goal to work toward as you continue to make your payments.

Are federal student loans forgiven after 20 years?

Yes, federal student loans may be forgiven after 20 years under certain circ*mstances. But only certain types of loans are eligible for forgiveness, and you must be enrolled in a qualifying repayment plan. You’ll also need to stay out of default on your loans.

In most cases, you must be a student borrower who took out Direct Loans from the federal government. These include:

• Direct Subsidized Loans
• Direct Unsubsidized Loans
• Direct PLUS Loans (though some limitations apply)

Along with an eligible federal loan, you must also have enrolled in an income-driven repayment plan, where the amount you pay each month is determined by how much you earn. Before you can qualify for forgiveness, you generally must make all your required payments for 10, 20, or 25 years, depending on the forgiveness program.

The rules for loan forgiveness differ slightly based on the type of loan you have and the repayment plan you chose. For example, parent borrowers who took out PLUS Loans to pay for their child’s education generally aren’t eligible for loan forgiveness unless they consolidate their loans into a federal Direct Consolidation Loan. The same goes for Perkins Loans or those from the Federal Family Education Loan (FFEL) program.

Federal student loan forgiveness programs

The federal government’s 20-year loan forgiveness programs are part of the income-driven repayment plans they offer. These are special benefits provided to federal student loan borrowers, and aren’t available to people with private loans.

In general, income-driven repayment plans are intended to help borrowers keep their payments affordable. Your monthly payment is based on a percentage of your discretionary income and family size, and you’re required to recertify your earnings each year.

However, these plans also extend the length of time it takes to repay student loans and you may pay significantly more in interest than you would if you were in a standard 10-year repayment plan. You may be eligible for forgiveness after making 20 years of payments — or more — under the following IDR plans:

• Saving on a Valuable Education (SAVE) plan: Formerly called Revised Pay As You Earn (REPAYE), this recently revamped repayment plan sets your monthly payment at 10% of your disposable income. Your balance can be forgiven after 20 years if your loans were for undergraduate study, or 25 years if you have graduate school loans. Additional changes will roll out in July 2024, further reducing the amount you must pay and potentially offering forgiveness in as little as 10 years.
• Pay As You Earn (PAYE) plan: Your monthly payments are capped at 10% of your discretionary income, but can’t be higher than they would be under a standard 10-year repayment plan. The balance of your loans is forgiven after 20 years.
• Income-Based Repayment (IBR) plan: Your payments will be set at 10% of your discretionary income if you borrowed on or after July 1, 2014, or 15% if you borrowed before that date. In either case, your payment can’t be higher than your payment would be under a standard 10-year repayment plan. The balance of your loans will be forgiven after 20 years if you first borrowed on or after July 1, 2014, or 25 years if you borrowed before then.
• Income-Contingent Repayment (ICR) plan: Your payment amount is set at either 20% of your discretionary income, or, what you would pay with a fixed-payment plan over 12 years. Your balance can be forgiven after 25 years. This is the only IDR plan available to parent PLUS borrowers, but you must consolidate your PLUS Loans before enrolling.

Public Service Loan Forgiveness

If you work in the government or not-for-profit sector, you may be able to have your loans forgiven even sooner. The Public Service Loan Forgiveness Program can waive the remaining balance of your loans after you make 120 qualifying payments while working full-time for certain types of employers. These include U.S. government agencies at any level, including the military, or not-for-profit organizations.

To qualify, you’ll need to make payments under one of the four income-driven repayment plans listed above.

Read More: The Complete List of Student Loan Forgiveness Programs

Student loan forgiveness by loan type

In general, you must have a Direct Loan to qualify for loan forgiveness after 20 years. These loans are issued directly by the U.S. Department of Education. The specific type of Direct Loan, though, can affect how the process works.

• Direct Subsidized Loans: These loans are available to undergraduate students with financial need and have a key benefit — the government pays your interest while you’re enrolled in school and during other periods of nonpayment. These loans are eligible for any of the four repayment plans listed above, and can be forgiven after 20 years of payments.
• Direct Unsubsidized Loans: These are offered to undergraduate, graduate, or professional students, with no financial need requirement. You’re responsible for interest fees from the moment the loan money is sent to your school. These loans are also open to any of the four repayment plans, and you may have your loans forgiven after 20 years. However, if you have any loans for grad school, that time period is extended to 25 years under the SAVE plan.
• Direct PLUS Loans: These loans are for graduate or professional students, or parents of undergraduates. If you’re a student borrower with these loans, you can qualify for any of the four repayment plans. Because these are for graduate study, you’ll need to make payments for 25 years if you’re on the SAVE plan. However, if you’re a parent, you won’t qualify for loan forgiveness without consolidating your loans.
• Direct Consolidation Loans: These loans let you combine multiple types of federal debt into a single loan with just one servicer. Unless you have parent loans in the mix, you can use any of the four repayment plans and qualify for forgiveness after 20 years. If you do have parent loans, you’ll only have access to the ICR plan, which allows you to have your balance forgiven after 25 years.
• FFEL Loans: Federal Family Education Loans haven’t been issued since 2010. If you still have these loans, you can use the IBR plan and have your loans forgiven after 25 years. If you consolidate these loans, you may become eligible for other IDR plans in some cases.
• Perkins Loans: Perkins Loans were made for low-income students with “exceptional financial need,” but they’re no longer available. These loans aren’t eligible for any of the four IDR plans unless you consolidate them first.

Read More: How To Get Parent Student Loan Forgiveness

How to apply for student loan forgiveness programs

Applying for student loan forgiveness programs happens through your loan servicer, the company that handles your payments. Contact your loan servicer if you’re interested in learning how to qualify.

To start, you’ll want to make sure you’re enrolled in one of the income-driven repayment plans you qualify for. This doesn’t happen automatically, and unless you choose otherwise, you’ll be automatically enrolled in the Standard Repayment plan. You can switch your repayment plan at any point, for free.

During your 20 years or more of payments, you must annually recertify your income level and family size to make sure your income-based repayments are set at the right amount. Your loan servicer will notify you when it's time to recertify, so make sure you keep your contact information up to date.

If you’re applying for Public Service Loan Forgiveness, the process is a little different. You’ll need to fill out a special application for this program, which is available on the StudentAid.gov website. It’s also a good idea to certify that your past or present employer meets the requirements for PSLF, which can be done on the same site.

Strategies for student loan forgiveness

Twenty years is a long time, but it’s important to stay on track toward your loan forgiveness. These strategies may help you:

• Set a reminder for paperwork deadlines: To stay in an income-driven repayment plan that qualifies you for forgiveness, you’ll need to recertify your earnings and family size each year. Put this deadline on your calendar or set a yearly reminder on your phone, and make sure to give yourself plenty of time to complete the process.
• Consider renewing early: If your income goes down or if your family grows, you can choose to recertify early. This can reduce the payment you’re required to make.
• Make sure your payments qualify: In addition to harming your credit and incurring fees, late or missed payments may not be counted toward your forgiveness.
• Keep track of your progress: Your loan servicer keeps a record of your payments and your progress toward loan forgiveness, and should let you know when you’re getting close. If you can’t view your progress online through your loan account, you may need to request your history of payments.

Private student loan refinancing

Loan forgiveness applies to federal student loans only. If you have private loans, you’re generally not eligible. In most cases, private loans only offer repayment plans that fully pay off your loans in a specified period of time — often five, seven, 10, or 15 years.

However, you may be able to lower your monthly payment on your private student loans by refinancing. When you refinance your student loans, you take out a new loan that pays off and replaces the debts you currently have. If your financial situation has improved since you first borrowed, you may qualify for a lower interest rate that can dramatically reduce the amount you pay.

While it is possible to refinance federal student loans into a private loan, be cautious. By refinancing, you’ll lose access to federal benefits — including income-driven repayment and loan forgiveness after 20 years.

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