Although there aren’t any student loan forgiveness programs designed specifically for spouses of service members, military spouses can take advantage of the Public Service Loan Forgiveness Program and Income-Driven Repayment Plan Forgiveness. They also can get their student debt forgiven if they become permanently disabled. Here’s how those three programs work.
Public Service Loan Forgiveness
The PSLF Program wipes out your federal loans tax-free after you’ve made 10 years’ worth of qualifying payments while working for the government or nonprofit organization. PSLF qualifying payments are any payment made on time through an income-driven repayment plan like Income-Based Repayment or the Revised Pay As You Earn Plan.
The Biden administration has made several changes to the program during the pandemic. Some of those changes were temporary, and the deadline has already passed. Others are permanent but won’t take effect until July 1, 2023. Once they do, borrowers who still work for a qualifying employer can get credit for:
Late, partial, and lump sum payments.
Months they spent in specific types of deferment or forbearance.
Related: Is PSLF Retroactive?
The changes will also allow contractors who work full-time for public service employers to get PSLF credit.
The public service program only applies to Direct Loans. Some federal loans aren’t Direct Loans. If you have FFEL or Perkins Loans, for instance, you must consolidate those loans into a Direct Consolidation Loan before May 1, 2023, to benefit from the new permanent changes. Read more about how to consolidate student loans for PSLF.
Related: Public Service Loan Forgiveness for Military Service Members
Income-Driven Repayment Plan Forgiveness
Income-Driven Repayment Forgiveness forgives your remaining balance after you’ve made at least 20 years’ worth of payments. IDR plans offer borrowers affordable monthly payments over 20 years (25 years if they ever borrowed a federal loan for graduate school) and promise forgiveness after they’ve made their final payment.
Few borrowers initially qualified for this debt relief either because they didn’t know about it — or because their loan servicer steered them into forbearances and deferments rather than offering to switch them to an IDR plan.
The Education Department plans to make borrowers whole starting this November when it implements a one-time account adjustment. The IDR Waiver will give you credit for every month spent in student loan repayment, deferment, or forbearance.
Starting in November 2022, borrowers who have been paying their federal student loans for 20 years or longer can expect to see the remainder of their debt discharged, while millions more will move significantly closer to forgiveness.
The department estimates that about 40 thousand people will have their debts wiped clean immediately and that 3.6 million more will get at least three years of additional credit towards IDR forgiveness.
You’re automatically eligible for this debt relief if you have Direct Loans. You may need to consolidate if you have FFEL or Perkins Loans. Visit StudentAid.gov to see what type of loans you have.
Learn More: FFELP Loan Forgiveness
Total and Permanent Disability Forgiveness
Military spouses can get their federal student loans forgiven if they qualify as totally and permanently disabled. They cannot, however, get their debt written off if their spouse served in the military and is now disabled. The Education Department doesn’t offer forgiveness to spouses caring for their disabled partners.
There are three ways to get a total and permanent disability discharge:
Your physician can sign an application and provide documentation to back up the claim that you have a physical or mental disability that prevents you from working.
The Social Security Administration determines that you can’t engage in a substantial gainful activity because of your disabilities.
The Veterans Administration determines you have a service-related injury that’s left you totally and permanently disabled.
The department has begun using data matching to find borrowers with existing disabilities on file with the VA or SSA. Those borrowers won’t need to get a disability discharge.
Learn More: Student Loan Forgiveness for 100% Disabled Veteran’s Spouse