Paying off student loans is a huge financial commitment that can last decades. With the cost of higher education rising every year, many graduates are stuck making payments well into their 40s and 50s. But what if you could get your remaining student loan balance forgiven after 20 years? This is possible for certain federal student loans through income-driven repayment plans.
I will explain how 20-year student loan forgiveness works, who qualifies, the repayment plans available, and how to get your loans forgiven. With detailed information and planning, you may be able to alleviate your student debt burden two decades earlier than expected.
Overview of 20-Year Student Loan Forgiveness
The federal government offers income-driven repayment plans that base your monthly student loan payment on your discretionary income. These plans span 20 or 25 years, after which your remaining loan balance can be forgiven if not fully repaid.
To qualify for 20-year forgiveness, you must have federal Direct Loans and enroll in an income-driven plan like Income-Based Repayment (IBR), Pay As You Earn (PAYE), or Revised Pay As You Earn (REPAYE). You must make consistent payments over 20 years before applying for loan forgiveness.
Only undergraduate loans are eligible for 20-year forgiveness under REPAYE. Graduate loans require 25 years under this plan. PAYE and IBR for newer borrowers offer forgiveness after 20 years regardless of loan type.
With 20-year forgiveness, you can eliminate student debt at an average age of 48 instead of 68 under the standard 10-year plan. This provides greater financial flexibility earlier in life.
Who Qualifies for 20-Year Forgiveness?
To have your student loans forgiven after 20 years, you must have eligible federal Direct Loans. These include:
- Direct Subsidized Loans
- Direct Unsubsidized Loans
- Direct PLUS Loans
- Direct Consolidation Loans
Private student loans and Parent PLUS Loans do not qualify. To be eligible, you can combine certain federal loans into a Direct Consolidation Loan.
The type of income-driven plan you choose also determines eligibility:
- REPAYE: Undergraduate loans only
- PAYE: All borrowers qualify
- IBR: Borrowers after July 1, 2014 qualify
Older IBR borrowers must wait 25 years for forgiveness. Your payment is based on how much money you make each month, and it can be as little as $0.
Income-Driven Repayment Plan Options
You must enter an income-driven repayment plan to be eligible for 20-year student loan forgiveness. Here are the three main options:
1. Revised Pay As You Earn (REPAYE)
- Payment capped at 10% of discretionary income
- Forgiveness after 20 years for undergraduate loans
- Forgiveness after 25 years for graduate loans
- No income requirement to enroll
2. Pay As You Earn (PAYE)
- Payment capped at 10% of discretionary income
- Forgiveness after 20 years for all borrowers
- Must prove financial hardship through income test
3. Income-Based Repayment (IBR)
- Payment from 10-15% of discretionary income
- Forgiveness after 20 years for borrowers after July 1, 2014
- Earlier borrowers qualify after 25 years
- Must prove financial hardship through income test
Compare plans to find the most affordable option. Debtors who are married must use their combined income for REPAYE, but they can file their taxes separately for IBR and PAYE.
How to Apply for Student Loan Forgiveness
Applying for forgiveness after making 20 years of qualifying payments involves a few steps:
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Get in touch with your loan servicer and let them know you want to apply for income-driven loan forgiveness. Provide updated income details.
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Submit an application – Your servicer will provide the forgiveness application form. Supply all required income documentation.
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Continue making payments – Keep paying your determined monthly amount until the servicer confirms your forgiveness.
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Receive confirmation – After reviewing your application and payment history, your servicer will notify you of approval and the forgiven balance.
Tracking your payments and communication with the servicer is vital throughout the process. Make sure you submit annual income updates on time to avoid losing qualification.
Can Loans Be Forgiven Earlier Than 20 Years?
If you’re looking for faster student loan forgiveness, the Public Service Loan Forgiveness (PSLF) program is your best option. It offers forgiveness after just 10 years of payments while working full-time for a government agency or eligible non-profit. You must be on an income-driven plan and make 120 qualifying monthly payments.
PSLF has the huge benefit of cutting your repayment period in half, leading to loan forgiveness at an average age of just 38. The drawback is it requires specific employer criteria that not everyone can meet.
For most borrowers, 20-year forgiveness is the earliest possibility for shedding student debt. Make sure you understand the requirements and actively manage your loans to successfully qualify.
Is Student Loan Forgiveness After 20 Years Right for You?
While loan forgiveness can be a huge relief, it comes with drawbacks:
- Decades of monthly payments
- Accumulation of substantial interest
- Potential tax liability on the forgiven amount
- Restrictions on career and income
Weigh these cons against the benefit of shedding your remaining balance. In some cases, you may be better off making higher payments to repay loans faster.
Refinancing with a private lender can also secure a lower interest rate, helping you become debt free sooner. Explore all options to choose the best path forward.
The availability of 20-year student loan forgiveness opens up a viable route to shedding debt in mid-life rather than retirement. Understand the requirements and actively manage your loans to ensure you remain on track. With the right plan, your student loans could be forgiven when you’re just 48.
How to qualify for Public Service Loan Forgiveness
Getting PSLF will require careful attention to detail. Here are some tips to achieve forgiveness as painlessly as possible.
Use the PSLF Help Tool to figure out your next steps. This tool is provided by the U.S. Department of Education (ED) and is free to use. Submit the forms suggested by the PSLF Help Tool to document your qualifying employment and receive credit for your monthly payments.
Only federal Direct Loans can be forgiven through PSLF. If you have other federal student loans such as Federal Family Education Loans (FFEL) or Perkins Loans you may be able to qualify for PSLF by consolidating into a new federal Direct Consolidation Loan. To learn more about consolidation visit the Department of Education’s website .
Save your digital receipts or monthly statements—for every payment!
The PSLF Help Tool tracks your progress to 120 qualifying payments. Check it regularly to make sure it matches your records. You do not have to make the 120 qualifying payments consecutively.
Keep in mind: Some borrowers have reported that their servicers’ payment tallies do not match their personal records. Contact the servicer to try to resolve this issue. Submit a complaint with the CFPB or Federal Student Aid (FSA) if you run into this problem.
Paused payments count toward PSLF as long as you meet all other qualifications. You will get credit as though you made monthly payments. Visit ED for more information on the payment pause and PSLF .
Deferments prior to 2013 and extended periods of forbearance will be automatically counted as qualifying payments. To request credit for shorter forbearances—less than 12 months in a row, or under 36 months altogether—file a complaint with the FSA Ombudsman .
Note: New changes to IDR plans can affect your PSLF loan payment count. Visit Department of Education website to learn more .
You will need to recertify your income-driven repayment plan each year. We also recommend that you recertify your employer each year —the PSLF Help Tool will guide you to the form you’ll need to complete and submit.
ED offers an online form to request your PSLF/TEPSLF denial be reconsidered . To prepare to fill out the form, gather information about the payments you believe should be counted. This includes the dates of these payments; tax information for your public service employer at that time; and digital proof of your employment and payments, such as W2 forms and letters or statements from the loan servicer.
If your federal loans go into default, you will need to rehabilitate or consolidate them to get back on track to qualify for PSLF. Compare which option may be best for you .
One-time adjustment to fix IDR loan forgiveness
On April 19, 2022, Department of Education (ED) announced several changes and updates that will bring borrowers closer to forgiveness under IDR plans. ED will do a one-time adjustment to count any month spent in repayment, some deferment periods (prior to 2013), and some forbearance periods toward loan forgiveness. For some borrowers, these changes mean that they will receive additional years of credit toward loan forgiveness. If you have loans that have been in repayment for more than 20 or 25 years, those loans may immediately qualify for forgiveness.
Borrowers who have reached 20 or 25 years (240 or 300 months) worth of eligible payments for IDR forgiveness will see their loans forgiven as they reach these milestones. ED will continue to discharge loans as borrowers reach the required number of months for forgiveness. All other borrowers will see their loan accounts updated in 2024.
TIP: No student loan borrower will have to pay any fees to receive their credit toward forgiveness. If someone asks you to pay them to get you loan forgiveness, it’s a scam.
What counts towards the 20 or 25 years required for IDR forgiveness?
- Any months with time in repayment status (regardless of the payments made, loan type, or repayment plan).
- 12+ months of consecutive forbearance or 36+ months of cumulative forbearance.
- Months spent in economic hardship or military deferments after 2013.
- Months in deferment prior to 2013 (except in-school deferment).
- Any time in repayment prior to consolidation on consolidated loans.
Only federal student loans managed by Department of Education (ED) qualify for the one-time IDR adjustment. Borrowers with Direct Loans or federally-managed FFELP loans will not have to take any action in order to benefit under the one-time account adjustment. Any borrower with ED-held loans that have accumulated time in repayment of at least 20 or 25 years will see automatic forgiveness, even if the loans are not currently on an IDR plan.
Borrowers with FFELP loans held by commercial lenders or Perkins loans not held by ED can benefit if they consolidate into Direct Loans. Borrowers must consolidate by June 30, 2024, in order to benefit from the one-time IDR account adjustment. Borrowers can apply for a Direct Consolidation Loan online or with a paper form .
TIP: Not sure what type of loan you have? Log into StudentAid.gov using your FSA ID and select “My Aid” under your name. That page will display information about your federal loan amounts, including whether your loans are Direct or commercial FFELP. For more information, contact your student loan servicer.
Learn more information about the IDR fixes on the Department of Education’s website .
Do Student Loans Disappear After 20 Years?
FAQ
Can you get student loan forgiveness after 20 years?
If a borrower has ED-held loans that have been paid back for at least 20 or 25 years, the loans will be forgiven automatically, even if the borrower is not on an IDR plan at the moment. Borrowers with FFELP loans held by commercial lenders or Perkins loans not held by ED can benefit if they consolidate into Direct Loans.
At what age do student loans get written off?
Federal student loans in the US are not typically “written off” based on age. Instead, they are discharged (forgiven) after a certain period of qualifying payments under specific income-driven repayment (IDR) plans or after 20 or 25 years, depending on the plan, regardless of age.
What is the 20 year rule for student loans?
Most IDR plans have a 20 or 25 year “payment term,” meaning that after 20 or 25 years of qualifying monthly payments (i. e. , 240 or 300 monthly payments) any remaining balance on the loan will be cancelled.
Can student loans be collected after 20 years?
Most private student loans will be taken off your credit report after seven years, but they won’t go away until you pay them off. Keep in mind that lenders can still contact you to collect an old debt, even if it’s decades old, but they can no longer take you to court over it.