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Information on Student Loan Forgiveness for Law Enforcement Officials - The Bills.com Blog
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Information on Student Loan Forgiveness for Law Enforcement Officials
Friday, Nov 21, 2008
Question: I am a law enforcement officer with the State of Florida. In 2002, I received my MBA and secured approximately $15,000.00 in student loans. I read your "student loan forgiveness" article and would like to know the process for forgiving my student loan. I have been a law enforcement officer continuously since 1991. Thank you.
Answer: Various loan forgiveness programs are available for borrowers who enter law enforcement and other public service professions. The programs available to you as a law enforcement officer will depend largely on the types of loans you took out to fund your education. The first question to ask is whether the loans you borrowed were federally insured loans, such as Perkins, Stafford, or PLUS loans, or private student loans. While both federally insured and private student loans are issued by banks (with the exception of Perkins loans, which are given directly by schools), the key difference between the two is that with federally insured loans, the U.S. Department of Education guarantees that if the student defaults on the loan, the federal government will reimburse the lender for its losses. In turn, the federal government will come after you to collect the money which it was forced to pay to your lender. The federal guarantee of these loans allows lenders to provide loans without rigorous credit checks and to offer much lower interest rates than would be offered on many conventional loans. However, banks must abide by a long list of federal regulations in order to participate in the federal student loan programs. Private student loans, on the other hand, are basically the same as any other unsecured personal loan; the only major difference between private student loans and regular personal loans is that the former are generally non-dischargeable in bankruptcy.If your student loans were federally insured loans, you may qualify for various types of
relief due to your employment as a law enforcement officer. To my understanding, law enforcement officers working for qualifying agencies are eligible for cancellation of student loans extended under the Federal Perkins Loan program. Depending on your length of service, you may be eligible for cancellation of up to 100% of your Perkins Loan debts. Since Perkins loans are administered by individual colleges and universities, you should contact the school you were attending when you incurred the debt to discuss your eligibility for cancellation as a law enforcement officer and how to apply for the cancellation program. To read more about Perkins loans and the various programs available to borrowers, you can visit staffordloan.com . In addition, the U.S. Department of Education offers a guide to its loan cancellation programs, available at http://ifap.ed.gov .
Under another federally sponsored program, the remaining balance on Stafford loans can be cancelled for individuals in law enforcement and other qualifying professions after the borrower has made 120 payments on the loan. Since most standard repayment plans for Stafford loans are scheduled for ten years (120 payments), you would need to select an extended repayment option, such as an “income contingent” payment plan, in order to benefit from this program. In order to qualify for this option, you must have served in law enforcement for ten years. To read more about the specifics of this program, you can visit http://studentaid.ed.gov .
Most private student loan programs
Under another federally sponsored program, the remaining balance on Stafford loans can be cancelled for individuals in law enforcement and other qualifying professions after the borrower has made 120 payments on the loan. Since most standard repayment plans for Stafford loans are scheduled for ten years (120 payments), you would need to select an extended repayment option, such as an “income contingent” payment plan, in order to benefit from this program. In order to qualify for this option, you must have served in law enforcement for ten years. To read more about the specifics of this program, you can visit http://studentaid.ed.gov .
Most private student loan programs
do not offer any forgiveness or cancellation program for individuals in public service professions. If the money you borrowed to finance your education was in the form of private student loans, you may have no choice be to repay the loans as required by your original loan agreement. If you are struggling to repay your private student loans, you should contact your lender to discuss the possibility of reducing or deferring your monthly payments until your financial situation improves. Unlike lenders participating in federal loan program, private lenders are not required to offer you options to reduce your monthly payments; however, many will work with you in reducing your payments in order to prevent you from defaulting in your loan payments. Given the overall poor performance of the economy as a whole, most lenders do not want to see another loan go into default.
If you find that your student loans do not qualify for cancellation, you may want to consider a loan consolidation program to lower you monthly loan payments. To learn more about student loans, I encourage you to visit the Bills.com Student Loan Information page. If you enter your contact information on the Bills.com site, we can have several pre-screened student loan consolidation providers contact you to discuss the options available to you.
I wish you the best of luck in resolving your student loans. I hope that the information I have provided helps you Find. Learn. Save.
Best,
Bill
www.bills.com/blog/
If you find that your student loans do not qualify for cancellation, you may want to consider a loan consolidation program to lower you monthly loan payments. To learn more about student loans, I encourage you to visit the Bills.com Student Loan Information page. If you enter your contact information on the Bills.com site, we can have several pre-screened student loan consolidation providers contact you to discuss the options available to you.
I wish you the best of luck in resolving your student loans. I hope that the information I have provided helps you Find. Learn. Save.
Best,
Bill
www.bills.com/blog/
Also, make sure to get a free financial health check-up with Bills IQ!
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