Connecticut Student Loan Forgiveness

Despite Connecticut being ranked the sixth-wealthiest state in America, student loan debt remains a pressing issue for its 497,700 borrowers, who collectively owe $17.5 billion.

The average debt per borrower is $35,162, notably higher than the national average.

High-income inequality further complicates the situation, as the richest 1% in 2018 earned nearly 37 times more than the bottom 99%.

This inequality means that many Connecticut residents will struggle financially despite living in an overall affluent area — especially when the Biden administration restarts student loan payments and interest rates later this summer.

Explore Connecticut-specific and federal student loan forgiveness programs to help ease your financial burden.

Related: State Programs for Student Loan Forgiveness

Before exploring Connecticut-specific programs, let’s discuss the federal student loan forgiveness programs the Department of Education offers to all Americans, including Connecticut residents.

These programs provide relief for federal student loans based on factors such as your profession or income.

1. The Public Service Loan Forgiveness Program

The PSLF is designed for individuals working in qualifying public service jobs with Direct Loans.

To be eligible, borrowers must make 120 qualifying monthly payments under a qualifying repayment plan while working full-time for a qualifying employer, such as a government agency, public school, or nonprofit organization.

2. Income-Driven Repayment Plan Forgiveness Waiver

Starting in spring 2023, relief will be automatic for most borrowers who have been paying their federal student loans for 20 years or longer, letting them see the rest of their debt discharged.

These changes result from a new IDR account adjustment announced by the Biden administration in April 2022.

For one time only, nearly every month spent in student loan repayment or a long-term forbearance since leaving school will count toward forgiveness.

All federal student loans are eligible for this one-time account adjustment — including Parent PLUS Loans, Federal Family Education Loans, and Perkins Loans. But some borrowers will need to consolidate to qualify.

The U.S. Department of Education and the White House estimate that once implemented, the IDR Waiver will immediately eliminate federal student loan debt for over 40 thousand borrowers and bring millions more at least three years closer to income-based repayment forgiveness.

3. President Joe Biden’s Broad Debt Cancellation Plan

This student debt relief program promises to wipe out up to $20,000 of debt for Pell Grant recipients who meet income criteria and up to $10,000 for other qualifying borrowers.

Applications are currently on hold as the Supreme Court assesses the program’s legality.

Meanwhile, the Biden administration has prolonged the pandemic-related payment pause and interest rate freeze, lasting 60 days after the Court decides on President Biden’s student loan cancellation plan or until June 30, whichever occurs first.

Connecticut offers a variety of student loan forgiveness programs for its residents, focusing on public service professions like education and healthcare.

The most prominent program is the Minority Teacher Incentive Program, which provides grants and loan reimbursement for minority students enrolled in teacher education programs and minority teachers working in Connecticut public schools.

Additionally, there are several other programs in Connecticut state statute that could receive funding, further expanding loan relief opportunities for Connecticut borrowers.

Minority Teachers Minority Teacher Incentive Program

The Minority Teacher Incentive Program provides grants for minority students enrolled in teacher education programs at eligible Connecticut universities and colleges.

The program also offers loan reimbursement for minority teachers working at Connecticut public schools.

• Eligibility: Minority students enrolled in teacher education programs or minority teachers working in Connecticut public schools. Contact your school’s Dean of Education or the Connecticut Office of Higher Education for more information.

• Grant amount: Up to $5,000 annually for two years for eligible minority Connecticut college students.

• Loan reimbursement: Up to $2,500 yearly for up to four years of employment for minority teachers working in Connecticut public schools.

• Total aid: Up to $20,000 in financial aid for eligible Connecticut minority teachers.

• Contact: Call (860) 947-1855 or email mtip@ctohe.org.

Other Connecticut Forgiveness Programs Several programs are in Connecticut state statute but not receiving funding. These include:

• Connecticut Green Technology, Life Science, and Health Information Technology Loan Reimbursement Program

• Engineering Connecticut Loan Reimbursement Grant Program

• English Language Learner Educator Incentive Program

• Information Technology Loan Reimbursement Pilot Program

• Primary Care Direct Services Program

• Nursing Education Loan Forgiveness Program

• You Belong Loan Reimbursement Grant Program

These programs may eventually receive funding, providing more opportunities for Connecticut borrowers to apply.

For more information on these programs, refer to the Connecticut Office of Legislative Research’s PDF titled “Student Loan Forgiveness and Repayment Programs.”

Connecticut Residents Receive Additional Relief Options

In response to the COVID-19 pandemic, Governor Ned Lamont and Banking Commissioner Jorge Perez announced on April 21, 2020, a collaboration with other states to provide relief options for Connecticut residents with private student loans not covered by the CARES Act.

If you hold commercially owned FFEL Programs or privately held student loans and face financial challenges due to the pandemic, you may be eligible for expanded relief. Contact your student loan servicer immediately to explore suitable options. Some relief options include:

• At least 90 days of forbearance

• Waiving late payment fees

• No negative credit reporting

• A 90-day halt on debt collection lawsuits

• Assistance enrolling in other borrower assistance programs, such as income-based repayment

Connecticut provides various state-specific student loan forgiveness programs for professionals like teachers, nurses, doctors, and lawyers.

These programs offer valuable financial relief to those who qualify and serve their communities in crucial roles.

While the fate of Biden’s debt forgiveness plan for millions of federal student loan borrowers remains uncertain, keep in mind that these state-specific programs are still accessible to eligible borrowers in Connecticut.

Stay informed about the latest developments in debt cancellation, both in the state of Connecticut and at the federal level, by subscribing to our newsletter.