Cancer Patients Loan Forgiveness – Deferment, Options Etc.
Cancer Patients Loan Forgiveness: Are you a borrower of federal student loans? Or, have you borrowed from private lenders? It is important you know this. There are a couple of options that can help you get forgiveness as a cancer patient.
If you’ve been following the cancer trend you will agreed to this. Each year, roughly 70,000 young people are diagnosed with cancer. Also, this young people are between the ages of 15 and 39. This is a key statistic that has flown largely under the radar.
Furthermore, it is important you know this. This particular group of cancer patients don’t qualify for some government relief programs. Especially, those that are available to help people with cancer.
Particular concern for this group is the burden of student loan debt. However, recent legislation introduced to Congress seeks to remedy the situation. In this article, you shall read about how to defer student loan as a cancer patient.
What to Note as a Cancer Patient
Has cancer created a situation where you no longer bring in income? Or, has your income greatly dropped? There is still hope. There is an income-driven repayment plan for you. This is likely the best option. Your monthly payments could be reduced to $0 per month. However, this depends on your income.
Please not. This reduction would not reduce your loan balance. It will actually grow due to interest. However, the months on an income-driven repayment plan will count. It counts towards student loan forgiveness. Also, if the income-driven repayment plan doesn’t drop payments to a low enough level, please take note. The next best option is likely a forbearance or a deferment.
There is no specific deferment or forbearance for cancer. However, there are for financial hardships. This includes medical expenses. Thus fighting cancer should certainly qualify.
However, the issue here is that it is a short-term fix. Also, the interest will continue to gather on your student loan account. At best, it will have to be renewed every 12 months.
Cancer Patients Loan Forgiveness – Private Lenders
Borrowers with private student loans should take note. They will similarly find a lack of support and resources for their student debt. The reason is this. Private lenders have little incentive to help borrowers out. Also, they can be quite ruthless.
However, some lenders are better than others at dealing with special circumstances. Your best bet is to inquire from your lender. Also, make sure you are working with someone who has the authority. I mean the authority to provide your desired fix. This fix is to your student loan situation.
Also, note this. If you want interest to stop collecting while in treatment, it’s a long shot. However, it’s worth trying. But, make sure the person on the other end has the ability to fulfill your request.
Student Loan Deferment for Active Cancer Treatment
When opting for cancer patients loan forgiveness, it is important you know this. Dealing with cancer does not earn any sort of forgiveness on student debt. The only way to have federal student debt forgiven under these circumstances is this. You must show total and permanent disability.
However, private loans will depend upon the terms of your loan agreement. But there likely isn’t a provision that will help you out.
Federal Direct student loan borrowers undergoing active treatment for cancer should note this. They may defer repaying their Federal Direct student loans for the duration of treatment.
Also, this can be for 6 months afterward. Interest does not accrue on any Federal Direct student loans during the active cancer treatment deferment. Not even on unsubsidized Federal Direct Stafford loans.
Cancer Patients Loan Forgiveness – Why the Option of a Deferment?
When opting for cancer patients loan forgiveness, please note. The new deferment for active cancer treatment was included in section 309 of the Department of Defense and Labor, Health and Human Services, and Education Appropriations Act, 2019. Also, it was included in Continuing Appropriations Act, 2019 (P.L. 115-245).
The reason is this. People who undergo cancer treatment have to deal with a lot of stress. This stress goes beyond finance. Stress can affect cancer patient survival rates.
Additionally, dealing with student loans is another source of stress. The reduced income during a short-term or long-term disability is often insufficient to continue making student loan payments.
Cancer Treatment vs Economic Hardship Deferments
Some borrowers undergoing cancer treatment can qualify for the economic hardship deferment. However, the deferment for active cancer treatment is better. This is because:
- The deferment for active cancer treatment suspends repayment on the borrower’s Federal Direct student loans. This is during any period in which the borrower is receiving treatment for cancer. Also, plus 6 months after the end of treatment. This contrasts with the economic hardship deferment. This is so because economic hardship is available for up to 3 years. That is in its total duration.
- The deferment for active cancer treatment waives the interest on all federal student loans. This includes both subsidized and unsubsidized loans. The economic hardship deferment waives the interest only on subsidized loans. Thus, interest on unsubsidized loans continues to be the responsibility of the borrower. Also, this will be capitalized by adding it to the loan balance. That is if the interest is not paid as it accrues.
Applying for Active Cancer Treatment Deferment
When opting for cancer patients loan forgiveness, please note. Until application form becomes available, borrowers should note. If you’re undergoing cancer treatment contact the servicer of your federal student loans. Ask for the Student Loan Deferment for Active Cancer Treatment.
The servicer may ask you to provide a letter from your oncologist. This is to confirm the cancer diagnosis and treatment. Doctors often provide such letters to their patients for disability and insurance purposes.
The law is effective for loans made on or after the date of enactment. It is effective for loans in repayment on the date of enactment. The law applies only to Federal Direct Loans. Borrowers with FFEL program loans may consolidate them. This consolidation is into a Federal Direct Consolidation Loan to qualify.
Options for Deferring Private Student Loans
The deferment for active cancer treatment applies only to federal education loans. However, borrowers of private student loans should contact their lender to ask about their options.
Lenders may offer the borrower a forbearance that suspends all payments. Interest continues to accrue, increasing the size of the loan. Some lenders may offer a partial forbearance. Here, the borrower makes interest.
Cancer Patients Loan Forgiveness – Other Options
The above-discussed deferment is just for cancer. Thus, it does not address other serious medical conditions. However, borrowers who are affected by other serious illnesses have several options.
These options include:
- The economic hardship deferment.
- Unemployment deferment.
- Also, the forbearance.
- Another option is income-driven repayment. This bases the monthly payment on a percentage of the borrower’s income. This is opposed to the amount of debt.
The above options may be limited to 3 years in total duration. However, they can be stacked. Interest may continue to accrue during these options.
In a Nutshell
The above are some steps you can take to get your student loan forgiveness. It is important you know that this is for cancer patients. Thus, as a cancer patient, there is still hope for you.
