How to get out of student loans

Learn how to get out of student loan legally and make loans cheaper with loan repayment options and loan forgiveness options. Read different ways to discharge your loans. check this article for more.

Posted by Gowtham Ramesh on 25th March 2019


If you are the one among many students who have borrowed the student loan and fighting to get it monthly payments? If the student loans are giving hard times to fall sleep at night.

With the borrowing from student loan for the college results in long term of debt repayment for you which can be either a paying up less or nothing.

well, you are not a single person to feel about it. The Department of Educational released a report of statistics on 2017 revealing an 11.5% have defaulted their student loan which was taken in 2014.  which consist of a total 580,671 borrowers in that year.

To make points straight you cannot come out an outstanding debt totally either you can get forgiveness and discharge the extra amount that you need to pay. Where this sort of programmes can give you offers such as loan cancelation or assistance for qualifying employment or other criteria required. Generally, they give away the remaining of the student loan bills for a special circumstance.


Table of Content

  1. Ways to get out of paying student loans

  2. How to get out of student loan legally?

  3. Why did the government decide to close the student loan bankruptcy?

  4. Can lawyers help you out of student loans?

  5. How to prove undue hardship or disability?

  6. Can I make my Loans cheaper?

  7. How to avoid paying back of student loan through forgiveness or discharge?

  8. How to get out of paying student loans FAQs


11 Best ways to get out of paying student loans

As we discussed above the other options which can make the loans cheaper and easier through plans like income-driven repayment plans, Public Service loan forgiveness. this government allows various options to get away from the college student loan debts. Below are some options which will help you to get out of student loan debt without paying it fully.

  1. Income-Driven Repayment Plans

  2. Teachers Loan Forgiveness

  3. Perkins Loans

  4. Public Service Loan Forgiveness (PSLF)

  5. Student Loan Repayment assistance (LRAPs)

  6. Get organized

  7. Closed school discharge

  8. Consolidation and refinance

  9. Unpaid Refund Discharge

  10. Total and Permanent Disability Discharge (TPD)

  11. Death Discharge


1. Income-Driven Repayment Plans

After even paying for a period of 20 to 25 years on an income-driven repayment plan will eventually get forgiven at the same time of forgiven it will lower the monthly payments of yours as a normal regular bill which are capped at a certain percentage of the discretional incomes.

The duration of your payments for a period over than 20 to 25 years may cost you more than what you have signed up in the initial period as its a long run due interest rate.

The amount which was forgiven might get back to you in the form of taxable income, where you will be still holding a final bill that needs to pay off to complete your student loan debt.


2. Teachers Loan Forgiveness

If you are a teacher and still owe a student loan and you are teaching full time in a lower-income school for a certain period of duration then you might be eligible for a student loan forgiveness which is said as Teacher Loan Forgiveness. Where you might be having a 100% of your total Perkins loans forgiven which can go up to $17,500 for a Direct  Loan or Stafford Loan Forgiven.

3. Perkins Loans

If you still have a  loan from a closed perkin loan programs where you might able to get out from the student debt if you have served voluntarily in the Peace Crops or Ameri Corps Vista program, Where serving in the U.S. Armed forces in an unfriendly area or works in various professions which include of Teaching, Medicine, Social service or Law enforcement.


4. Public Service Loan Forgiveness (PSLF)

If you are working for any public service for a period of 10 years then you might be considered for the Public Service Loan Forgiveness program.

Where to get qualifies you to need to work for a period 10 years for a period at least 30 hours per week. you also need to make at least 120 qualifying monthly payments under an income-driven repayment plan.

The Future of PSLF programs are not clear and it can be phased out in the upcoming years. PSLF applicants have stated that their applications were denied for uncertain reasons.

Where the PSLF is active now where it remains in action, for now, the road to getting it is not as easy as people thought. In the last September more than 41,000 applications were there for forgiven but merely 206 has successfully got their loans discharged.


5. Student Loan Repayment assistance (LRAPs)

Student loan repayment assistance programs are provided by a lot of state universities and for some employers for qualifying their borrowers well not for all, it was primarily made for professionals in fields such as doctors, pharmacists, veterinarians, and teachers.

LARPs offers financial support after a period of 1/3 of service. Where some universities also provide student loan assistance for alumni for the exchange of working at a non-profit in a highly needed area for a certain period of time.

11 Best ways to get out of student loans

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Companies offering a student loan benefit for their employees for a percentage of their monthly payments. Based on the area where you live and work can qualify for assistance which can help you to pay off the student loan debt.


6. Get organized

To get a clear idea of inventory of the college debts that you owe. Go to the National Student Loan Data System to get all the information of your federal student loan and to get a copy of it to get a clear and better understanding of your private student loans too. Learn what the balance and interest rate means. Find the ways to make payments more affordable or postpone to temporarily.

7. Closed school discharge

If the school of yours gets closed before you can finish your program then it can be eligible for a closed school discharge of your student loan debt. where to qualify this you must be enrolled in the school while it was closed or should have withdrawn from the school less than 120 days before its closing.

If you don't have an opportunity to complete the program before the school got closed and if you are in need of diploma or certification then you are not eligible for the discharge.


8. Consolidation and refinance

Learn how the interest rate works on each of your loans and get to know is there any lower rate is there available which can help you to save money. Try to negotiate the rate to lower down.

Interest rate allows more of your payment to pay down the principle. By consolidation of your student loans further refinancing can give you lower interest rate with a decreased monthly payment or some times both.

9. Unpaid Refund Discharge

If you have withdrawn then the school might owe a refund to the U.S. Department of education or lender. If the school fails to provide this refund then you might be eligible for a discharge although it will only be cover the unpaid refund amount.


10. Total and Permanent Disability Discharge (TPD)

This may be eligible only for a set of people with certain criteria such as if you are a veteran with a record of service-connected to the disability? If you are receiving a Social Security Disability Insurance or Supplemental Security Income? If you have a Medical condition preventing you from getting engaged in any of the substantial gainful activities for the duration of 60 months or for the upcoming next 60 months or resulted in death is expected?

If the above criteria are related and you fit in then you might be eligible for total and permanent Disability Discharge and make sure to check out on the terms and conditions before getting in.

11. Death Discharge

It might be hard and bitter to hear it. Its fact that if the borrowers get died in any situation then the discharged with chapter 7 or 13 bankruptcy. Can be considered and must be initiated for an adversary proceeding by getting done of filling a complaint to determine the discharge ability. Which might then be on the up of you to get proved that paying back for a student loan might cause you undue hardships.

The Bankruptcy is always a last resort where every option has been exhausted and paying back your debts first which also includes Student loans


How to get out of student loan legally?

Declaring of bankruptcy in the case of student loan is not possible but under special circumstances, it may be considered such as Qualified undue hardship.

Before 1976 the loan is declared as bankruptcy when the court sees you struggling to pay them.

In 1998 they passed out 5 to 7 years of waiting period before declaring bankruptcy.

In 2005 they passed a bill to close all the possible ways to discharge of student loans through the bankruptcy.


Why did the government decide to close the student loan bankruptcy?

Handling of student loans is always a risky one as for both the government and private organizations. The students who have borrowed generally have way often lesser credit some cases no credit and they don't support in their repayment options.

If the lender plan to keep the interest rate with these considerations then it would be very higher than the present interest rate. To move these sort of risky position they have closed the student loan bankruptcy.

Still, there are a lot of ways different from declaring bankruptcy to get away from student loan loans programmes such as loan forgiveness. Which are only appropriate for the students with federal loans and some other programs for graduates and works in eligible jobs. Well, the forgiveness options demand on years of on-time payments for consideration of student loan forgiveness and sometimes you are required to pay in taxes for the loan forgiven.


Can lawyers help you out of student loans?

To eligible for bankruptcy, you are required to file Chapter 7 or 13 bankruptcy. You can go for a permanent discharge if you have a permanent disability which makes you from repaying of your loans. There are many states which provide you additional requirements to go for bankruptcy, were hiring an attorney can really help you in getting in and out of all the legal process and further issues in the court.

It might not good advice to go for a lawyer to get you off from paying your student loans. The legal fees might be higher than what you are expecting which is not worth it.


How to prove undue hardship or disability?

Another legal way to get out of your student loan is to get proved of undue financial hardship. Where you will be evaluated by the court on the Brunner Test. If you can prove undue hardship by meeting the required Brunner Test qualification, after it you may be eligible for it.

This test asks you whether are you able to maintain a basic standard of living while repaying your student loan and can you prove that undue hardship can last throughout the repayment term and if you have tried in good faith to repay your student loans before.

You can qualify for a student loan discharge without going to the court if you have a permanent disability. Where it's still tough to apply for a permanent disability discharge. Filling out of forms and providing these to the Department of Education stating that you are not able to earn an income because of the disability.

To do for eligibility:

  • You need an evaluation from a doctor

  • Submitting of the evidence from the Veterans Affairs in case (or)

  • Submitting that you have received the Social Security Disability Insurance.

  • You cannot apply for disability discharge until you have disabled for a period of 60 months except a doctor writes a letter stating on your disability and inability to work can last for at least 60 months.

Private student loans don't have the option to discharge the loans if you are permanently disabled. Discharge of federal student loan may be done with the disability from outside of the courtroom, which is not required in the case of private loans. Permanently disabled looking to get out of the loan from a private lender you will be going to the court of your lenders choice.


Can I make my Loans cheaper?

The idea of discharging your loans might look and sound exhaustive as it's not at all feasible. Well looking into deep gives you other legal options to explore around which can make your loans more bearable. These alternatives can help you to manage your loans at an affordable rate without discharging them.

Federal student loans can get you Income-based repayment plan which might cap down your monthly payments from 10% to 20% of your income based on the eligibility of yours. It also has certain downgrades please look into it and do the necessary researches before getting into it.

You can also go for forbearance or deferment where it allows you to hold your payments for a certain period of time where you are experiencing Financial hardship where the interest may accrue still with these plans.

Then there is student loan forgiveness where it forgives a certain part of your loan balances after a certain period of years.

Read different ways to discharge your loans

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Where it holds certain eligibility requirements to process the student loan forgiveness programs as it's been joined to work in the public sector and provides generally forgiveness of your loan after a period of 10 years where some might even require 20 - 25 years of payment to process the forgiveness and you are required to pay in taxes for the amount that has been forgiven.

Another option that is available for your student loan with a more affordable rate is to refinance your student loan debts. Whereby refinancing all your debts where it can help you to get a lower rate of interest and possibility to get lower monthly payments

Refinancing from a private lender can also change the duration length of your student loans. where the private lender can refinance both the federal and private student loan by doing these you might lose the perks and protections from the federal student loan such as income-based repayment plans.


How to avoid paying back of student loan through forgiveness or discharge?

ignoring of debt will make things tough and hard situation worse scenario of the case.  Going into default will make a host of situation creating bad consequences which could hurt your finances for a long period of time.

By avoiding the debts it makes things hard looking for other legal ways to get it sorted and move from the student debt without giving all of the paying for entire balance by yourself.

Forgiveness programmes can also offer relief as student loan assistance by the university or employer.

Under special circumstances closed schools disability then you might need to apply for a certain program to get your loans discharged. Make sure that you go through all the details of forgiveness or discharge program to be on the right lane for meeting the eligibility criteria.

Even though you cannot make it into any of the programmes look for other ways to get done with student loans.

There some side hustles available out where you can get cash to get rid of debt faster and can save you money on the interest. Consider student loan refinancing to get a lower interest rate of your debts or get a lower monthly payment amount.


How to get out of paying student loans FAQs

1. What happens to student loans when you die?

According to the U.S.Department of Education in the case of any borrowed a federal student loan gets died then the loan amount is automatically canceled and the debt is being discharged by the government. But not in the case of private student loans they don't offer the same liability protection as per federal government does.

2. Can student loans be paid off early?

yes, you can pay more than you are required a monthly payment there won't be any charge if you pay more. If you are very much interested in paying off the loan debt as soon as possible.

Work in advance and pay more than your usual monthly payment by paying off the loan as soon will help you in the long run as generally the interest gradually makes hard and take more than what was spoken when terms increase by this it can be avoided.

3. Do your student loans get forgiven after 25 years?

Generally, it's eligible for the borrowers who have been qualified for student loan forgiveness on their balance after a period of 20 years through a specific income-driven repayment plan such as Pay As You Earn (PAYE). Where anyone who is eligible for a federal student loan might be qualified for the income-based repayment plan which also offers forgiveness after a certain period.

4. Can you negotiate a payoff on a student loan?

The money is generated through the interest and fees that have been allocated further their perspective of getting their money that is you are setting your debts which is a huge change for them as you are paying off.

It will further make things easier by contacting your lender and on the instance without any hesitation if you feel bad or thing bad to call him then there is no possibility to negotiate your settlement. the best thing to do is pay off them with the balance as a full. it might not seem like a good move but trust that it will pay you off in the long run.

5. How do I prove undue hardship for student loans?

The proof generally lies on you as you need to prove that undue hardship. To convenience the court and make it as a success to discharge of your loans with the required records and documents to show that you are unable to maintain it on a minimal standard of living while doing it.

6. Can a lawyer help with student loans?

A lawyer will be helpful if you are doing any of the activity like dealing default or filling for bankruptcy, looking to apply for a disability discharge this all can be done with the help of a student lawyer.

Student loan lawyers can help with these like subtleties of private student loan any loan differences between them can be used here.

7. What is considered an undue hardship?

Undue hardship requires a significant expense on consideration of a number of factors which can be of the cost of accommodation associated with the size, resource and the operation of the employer's

It is determined o various factors facility to make the accommodation of larger entity here the structure and other resources are also considered the financial management too.

8. Can I get a student loan after filing chapter 7?

Bankruptcy might be qualified for certain student loans it will be a hefty process to get approved for other loans. Its mainly provided to the federal student loans under the Stafford and Perkins loans and provided only on the based on need and not on the creditworthiness. Filling a chapter Chapter 7 or 13 bankruptcy will not get anywhere between the federal loans.

9. Do you inherit your spouse's student loan debt?

It is for certain cases where your spouse can also be responsible for student loans. All federal loans and private loans offer a death discharge once the borrower dies while some private lenders may not discharge the loan.

10. How long does it take for a student loan to be wiped?

It takes around 30 years to wipe all of the remaining unpaid debts. You should either complete owing to the loan or either when you have successfully cleared the debt within the 30 years whichever comes first.