Are you worried about your student loan payments? Feeling overwhelmed? You’re not alone.
The repayment period can seem like an uphill battle.
The interest keeps piling up, and your balance never seems to shrink.
I was one of those people as well until a few months ago. And, after many years, my loans were forgiven through the Public Service Loan Forgiveness (PSLF) program.
The result of many years of making payments, not knowing if it would ever happen.
But, what if you aren’t eligible for forgiveness?
You are not alone! Millions of Americans struggle with the burden of student loan debt, but many don’t realize that there are options available to reduce or temporarily suspend these payments drastically.
This comprehensive guide is here to help.
We will explore the steps and strategies to bring your student loan payments down temporarily, possibly even to $0
Get Temporary $0 Payments Through Deferment
Deferment allows you to pause payments on federal student loans temporarily. This can provide breathing room if you’re struggling financially or going back to school.
Deferment is typically granted in six-month increments for up to three years total.
You’ll need to submit documentation proving you meet the eligibility criteria to qualify. Common reasons for approval include:
- Economic hardship – If you receive public assistance, are unemployed, or can document low income.
- Returning to school – For at least half-time college, trade school, or graduate school enrollment.
- Active military service – For borrowers on active duty during a war, military operation, or national emergency.
- Cancer treatment – For cancer patients undergoing chemotherapy or radiation.
Contact your loan servicer and request a deferment application to get a deferment.
Submit all required documents to prove your situation. Once approved, you won’t have to make payments until the deferment period ends.
Interest may still accrue on unsubsidized and PLUS loans.
Seek Forbearance for a Temporary Payment Break
Forbearance is another option to postpone or reduce federal student loan payments for up to 12 months at a time.
It provides immediate relief, but interest continues growing during forbearance. Qualifying reasons include:
- Financial difficulties – Such as unemployment, medical expenses, or family changes.
- Student loan debt exceeds 20% of total monthly gross income.
- A natural disaster – Like a hurricane or flood.
- A local or national emergency – Similar to a natural disaster
- Medical or dental residency – For borrowers completing residency programs.
To request forbearance, contact your student loan servicer. Explain your situation and why you need your payments suspended.
Submit any required documentation. With approval, you can get your payments dropped to $0 for up to one year.
Forbearance can be extended if you continue facing hardship.
Lower Payments with Income-Driven Repayment Plans
Income-driven repayment (IDR) plans allow you to pay a percentage of your discretionary income instead of a fixed amount. Discretionary is just what is left over after all bills have been paid.
Your payment gets recalculated each year based on your earnings. There are four main options:
- REPAYE (Now known as the SAVE Program) – 10% of discretionary income.
- PAYE (Pay As You Earn) – 10% of discretionary income.
- IBR (Income-Based Repayment) – 10% or 15% of discretionary income.
- ICR (Income-Contingent Repayment) – The lesser of 20% of discretionary income or what you’d pay on a fixed plan.
If your calculated payment doesn’t cover accruing interest, the government will pay the unpaid interest on subsidized loans for up to three consecutive years of enrollment.
To get started with an IDR plan, complete the application with your loan servicer detailing your household size and income. Provide proof of earnings.
Federal Loans Qualify for Loan Forgiveness Programs
After meeting program requirements, student loan forgiveness erases part or all of your debt.
Two popular options are:
Public Service Loan Forgiveness (PSLF): Forgives federal Direct Loans after making 120 qualifying payments while working full-time for an eligible employer like a nonprofit or government agency.
This is the program I participated in. You’ll need to complete the PSLF certification to track qualifying payments.
Teacher Student Loan Forgiveness: Provides either $5,000 or $17,500 in forgiveness (depending on subject area) for Direct Loans or FFEL Program loans.
Participants qualify for forgiveness after teaching full-time for five consecutive years in certain low-income schools and meeting other criteria.
Submit the Teacher Loan Forgiveness Application to apply.
With both programs, you’ll need to have the right type of federal loans and be enrolled in an income-driven repayment plan.
Forgiveness won’t be immediate but can wipe out a substantial portion of your student debt after steady payments over time.
Expect the Unexpected
While it may seem daunting, reducing your student loan payments is very doable by tapping into these options.
Follow these steps to get started:
- Contact your loan servicer – Discuss deferment, forbearance, income-driven repayment or forgiveness plans. Understand requirements and application processes.
- Submit applications and paperwork – Provide all needed documentation for the program you qualify for, like income verification.
- Recertify on time – Recertify annually to maintain $0 payments in an IDR plan. For PSLF, recertify employment every year.
- Keep up with requirements – To stay on track for future forgiveness, make sure you satisfy all program criteria.
How to Get Your Student Loan Payment to Zero
There’s no need to keep struggling under the weight of high student loan payments.
Don’t wait!
Take control of your finances today by calling your loan servicer to review options for reducing your monthly bills.
They can walk you through deferment, forbearance, income-driven repayment, and forgiveness programs to find the best fit for your situation.
With a proactive approach and commitment to following program guidelines, you can ease debt burdens and progressively lower payments to $0 a month.
Wishing you the very best – you’ve got this!
FAQs
Will reducing my payments to $0 a month negatively impact my credit score?
Getting approved for deferment, forbearance, or an income-driven repayment plan should not negatively affect your credit. Your credit score should be unaffected as long as you continue making the required monthly payments.
Can I get my payments down to $0 if I have private student loans?
Unfortunately, most of these options only apply to federal student loans. However, some private lenders may offer deferred payment options or modified repayment plans if you contact them directly and explain your financial hardship.
Is it difficult to qualify for $0 monthly payments?
The eligibility requirements vary for each program, but these are accessible options for borrowers genuinely facing financial strain. As long as you provide the documentation needed to prove your situation, approval should be fairly straightforward in most cases. The application process is free and available for any federal loan borrower.
Do zero-dollar payments count toward loan forgiveness?
Yes! Under an income-driven repayment plan, any month with a $0 payment will count towards PSLF if you’re employed full-time by a qualifying employer during that month.
