Is paying off your student loans impossible? Don’t give up hope. You have three possible escapes, including discharging your student loans in bankruptcy.
Public Service Student Loan Debt Forgiveness (PSLF)
If you work for a government, school, or hospital, you should be eligible for PSLF.
If you work for a school, government, hospital or other non-profit, can make payments for ten years and then clear your student loans. This loan forgiveness program was set up in 2007, when George W Bush was President. You had to make 120 monthly payments (not all in a row) and the rest of the loan would be forgiven.
In 2017, thirty thousand people had been paying for ten years. But the government disqualified all but 96 people. In the first four years starting 2017, the government turned down ninety-eight percent of the people who thought they had completed the program.
Last year President Biden made big changes. He made it easy for people working in public service to go back and get their years counted. That ended October 31, 2022. More than 200,000 people whose paperwork had their paperwork straightened out and their loans cleared in 2022.
If you missed that deadline, through the end of 2023, you can still claim credit for some years where your paperwork was wrong.
Do you work for a school, government, hospital or non-profit? If you never heard of this program, find out more.
Biden’s New SAVE Program: Supreme Court and Trump cancelled it.
The Biden administration announced their new SAVE plan, right after the Supreme Court shot down his plan to forgiveness $10,000 for everybody.
The SAVE plan set a minimum monthly payment of 5% of your income on your undergraduate student loans. (That 5% won’t take effect until July 2024.) That’s gone now.
Find out what’s left of the SAVE program here.
You Can Clear Your Student Loans in Bankruptcy
Biden has changed the way government answers when you try to clear your student loans under the bankruptcy law. Instead of fighting tooth and nail, if you have a good case, the government will now agree.
So far, President Trump has not cnacelled this program. I had one student loan case that I filed before the elction and it was approved this Spring, after President Trump took office. I have another case pending.
Joshua Cohen, who may be the top student loan lawyer in the country, tells me they are still being approved, as of November 2025.
What’s a Good Case for Student Loan Discharge in Bankruptcy
If you graduated but never got a job in your field, we can use that to discharge your student loans in bankruptcy.
We have to show the court you are broke, that you’ve been responsible in the past, and likely to stay broke. Been responsible in the past can be made some payments or even applied for deferments. Just gave up and ignored the student loans won’t do.
For most people, the hard part is pointing to some reason why you are likely to stay broke is the key step.
Ten years out of school and still broke. That’s the easiest.
The school closed.
Didn’t finish for some good reason
Graduated but couldn’t ever get work in your field.
On-going medical problems.
Over age 65
Been out of work over and over