Will There Be Private Student Loan Forgiveness?

Wondering if there will be student loan forgiveness for private loans? Read on to learn where the conversation stands and some other strategies for borrowers.

Since the start of the 2020 election cycle, you may have heard the term "loan forgiveness" thrown around in connection with President Biden's policy platform. Now that the Biden administration is in power, speculation about federal loan forgiveness has increased dramatically.

But what about student loan forgiveness for private loans? Is that even being considered, or will private borrowers be left to fend for themselves in the event that federal student loan debt is partially or completely erased? Let's take a look at where the conversation currently stands and go over some alternative strategies private borrowers can use to save money.


Will There Be Private Student Loan Forgiveness?

Despite recent changes to the Public Service Loan Forgiveness (PSLF) program and other loan cancellation programs, the Department of Education has not announced any new plans to extend loan forgiveness to borrowers with private student loans.

As of now, private student loans do not qualify for any loan forgiveness programs, including PSLF and income-driven repayment plans. If Biden does announce widespread loan cancellation at some point, it will probably pertain only to federal loans. 

Like federal loans, private loans are almost impossible to discharge in bankruptcy unless you have a very low income and cannot afford the monthly payments. If you are disabled, you may be able to have your private student loans canceled if you can prove you’ll remain on disability benefits for the foreseeable future.

Other Options for Private Student Loans

Borrowers with private loans can use the following strategies to minimize their loan payments.

Loan Repayment Programs

Borrowers who work in certain industries may qualify for loan repayment programs, which are different from loan forgiveness programs. Many loan repayment programs offer money that borrowers can use for both federal and private loans, although that depends on the specific program.

Loan repayment programs usually require that you work a certain number of years, often between two and five, to receive a lump sum that can be put toward your student loan balance. Borrowers usually have to work in a low-income or underserved community to qualify.

Professions with dedicated loan repayment programs include nurses, doctors, pharmacists and lawyers. The specific amount repaid depends on the program and how long you work. 

Sometimes, you can extend the contract beyond the initial term to have more of your loans discharged. If you’re interested, conduct a Google search for loan repayment programs for your profession and see if you qualify for any.


Employer Student Loan Reimbursement 

Borrowers with private student loans may still be eligible for employer student loan reimbursement, where your company contributes money toward your student loans. The maximum annual limit is $5,250 in tax-free compensation.

Although these programs are becoming more popular, they’re not available from every company. Ask your HR department if your employer offers this benefit and how you can sign up. If you're currently looking for a new job, consider finding a company that offers student loan reimbursement.

Refinance Your Student Loans

Borrowers with private student loans can save money by refinancing their student loans with Juno, which partners with three different lenders to offer competitive interest rates. Refinancing your student loans to a lower interest rate could help you pay less interest over the life of the loan.

For example, let’s say you owe $50,000 in student loans with an 11% interest rate and a 15-year term. If you refinance to a 6% interest rate and a 15-year term, you’ll save $26,347 in total interest over the life of the loan. You’ll also pay $146 less each month.

Borrowers refinancing with Juno can choose from a fixed-rate loan or a variable-rate loan. Payments on a fixed-rate loan will remain the same for the whole period, while payments on a variable-rate loan may change from month to month.

Here’s how the three Juno lenders compare.


Earnest 

Earnest offers fixed interest rates starting at 2.44% APR and variable rates starting at 1.88% APR as of Nov. 2, 2021. Borrowers who refinance with Earnest through Juno will pay an interest rate that is 0.25% lower than if they refinanced with Earnest directly.

Earnest does not accept co-signers. If you have a new credit history or no credit history at all, you may need a co-signer to qualify for a refinance offer. If that is the case, you may have to choose from one of the other two lenders mentioned below. 

Splash 

Splash is a lending network that matches borrowers with several lenders offering student loan refinancing. When you apply with Splash, you may qualify for multiple refinancing offers. As of Nov. 2, 2021, fixed interest rates start at 2.44% APR and variable rates start at 1.88% APR.

Borrowers who refinance between $50,000 and $150,000 will receive a $500 bonus, while those who refinance more than $150,000 will receive a $1,000 bonus. These bonuses are available only if you refinance with Splash through Juno.


Laurel Road

Laurel Road provides student loan refinancing for physicians, nurses, optometrists, dentists and physician assistants. Borrowers repaying medical school loans will be required to make only $100 monthly payments while in residency or fellowship. That benefit is not available with many other lenders. 

As of Nov. 2, 2021, fixed interest rates start at 2.50% APR and variable interest rates start at 1.89% APR.  Borrowers who refinance with Laurel Road through Juno will qualify for an interest rate that is 0.25% lower than if they went through Laurel Road independently. Laurel Road does allow co-signers. 


Juno's Exclusive Student Loan Refinance Deals

Cosigner:

Can’t be refinanced with a cosigner

Rates:

Fixed starting at 2.19% APR, Variable starting at 1.63% APR including autopay and Juno discount.

Juno benefit:

Rate reduction of 0.25%

Check:

Soft Credit Check to get rates; Hard Credit Check to refinance


Cosigner:

May be able to refinance with a cosigner

Rates:

Fixed starting at 2.30% APR, Variable starting at 1.87% APR. May include autopay discount.

Juno benefit:

Up to $1,000 cashback based on loan amount

Check:

Soft Credit Check to get rates; Hard Credit Check to refinance


Cosigner:

May be able to refinance with a cosigner

Rates:

Fixed starting at 2.75% APR, Variable starting at 1.74% APR

Juno benefit:

Rate reduction of 0.25%

Check:

Soft Credit Check to get rates; Hard Credit Check to refinance


Juno's Exclusive Student Loan Refinance Deals

RatesJuno BenefitCheck
Best for Most
Can’t be refinanced with a cosigner
Fixed starting at 2.19% APR, Variable starting at 1.63% APR including autopay and Juno discount.Rate reduction of 0.25%Soft Credit Check to get rates; Hard Credit Check to refinance
Register for Earnest Deal (it’s free!)
Alternative Best for Most
May be able to refinance with a cosigner
Fixed starting at 2.30% APR, Variable starting at 1.87% APR. May include autopay discount.Up to $1,000 cashback based on loan amountSoft Credit Check to get rates; Hard Credit Check to refinance
Register for Splash Deal (it’s free!)
Best for Medical Professionals
May be able to refinance with a cosigner
Fixed starting at 2.75% APR, Variable starting at 1.74% APRRate reduction of 0.25%Soft Credit Check to get rates; Hard Credit Check to refinance
Register for Laurel Road Deal (it’s free!)


Zina Kumok
Written By
Zina Kumok

Zina Kumok is a freelance writer specializing in personal finance. A former reporter, she has covered murder trials, the Final Four and everything in between. She has been featured in Lifehacker, DailyWorth and Time. Read about how she paid off $28,000 worth of student loans in three years at Conscious Coins.

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