Your Rights

As a borrower, you have rights and responsibilities when it comes to managing your student loans. Knowing your rights and responsibilities means that you understand your “contract.” In its simplest terms, you are borrowing federal money for college, and you agree to repay the loan whether or not you finished the program or are satisfied with your education.

Depending on your financial situation and other criteria, you may have a right to extended, graduated, or income-sensitive repayment plans that offer lower monthly payments. See our repayment options page for more information.

– You may temporarily suspend your payments while you are in school at least half-time, on active military duty, or facing economic hardship such as unemployment. See our page about deferment and forbearance for more information
– Partial loan forgiveness can be granted if you decide to pursue a career that involves certain kinds of public service
– Partial or total loan discharge can be granted in cases of fraud, identity theft, or total and permanent disability

Borrowers who are “unable to engage in any substantial gainful activity by reason of any medically determinable physical or mental impairment that can be expected to result in death, has lasted for a continuous period of not less than 60 months, or can be expected to last for a continuous period of not less than 60 months” may be eligible for a Total and Permanent Disability (TPD) discharge. Once determined that the borrower is totally and permanently disabled, the Department of Education (ED) will place the borrower on a conditional discharge period for up to 3 years after the date the physician has signed the TPD application. If the borrower successfully completes the 3-year conditional period, the borrower will then have their eligible loans discharged. Visit ED’s TPD webpage for more information.

ED is authorized to establish regulations requiring the reinstatement and resumption of collection activities on any loan previously discharged in the event the borrower receives a new Title IV loan or earns income in excess of the poverty line. Reinstatement is allowed for any other reason ED deems appropriate.

A borrower who has been determined by the secretary of veterans affairs to be unemployable due to a service-connected condition and who provides documentation of such determination to the secretary of education shall be considered permanently and totally disabled. A borrower in this condition will not be required to present further supporting documentation.

Partial Loan Forgiveness for Special Service

If you hold certain jobs, you may be eligible to have your loans partially forgiven.

Program	You May Be Eligible if You…	Types of Loans Eligible for Forgiveness
Teacher Loan Forgiveness Program	– Have been employed as a full-time teacher for 5 consecutive years at a low-income elementary or secondary school, or in certain designated subject areas – Have a student loan that was made before the end of the 5th year of qualifying teaching service	– FFEL and Direct Loans – Must have no outstanding balance on a FFEL or Direct Loan as of October 1, 1998
Public Service Loan Forgiveness	– Make 120 on-time payments after October 1, 2007 – Are employed full-time for all 120 months in a public-service job and all payments must be made while employed in a qualifying job – Qualifying jobs include full-time employment in government, military and law enforcement, public services for those with disabilities or the elderly, social work, teaching in a high-needs area as determined by ED, public school-based services (such as library sciences), and public health and safety	– Federal Direct loans only. You may consolidate into the Direct Loan program to gain eligibility for this program – Only the balance remaining after 120 payments is forgiven

For more information, visit http://studentaid.ed.gov

Discharge

Under certain extreme circumstances, it may be possible to have your student-loan debt reduced or discharged. Such circumstances are when:

– You die or become totally and permanently disabled
– Your school closed before you could complete your program and you are unable to transfer your credits
– For FFELP and Direct Stafford Loans only: Your school owes your lender a refund, forged your signature on a promissory note, or certified your loan even though you didn’t have the ability to benefit from the coursework
– Someone fraudulently took out a loan in your name

Keep in mind: Only in certain extreme and rare situations can federal student loans be discharged through bankruptcy.

Discharge provisions differ depending on whether you have a Federal Perkins loan or a FFELP/Direct Stafford loan. For more information, visit http://studentaid.ed.gov.