Admit it, you're hoping a long-lost rich uncle steps
in to make your student loans disappear.
Never hurts to dream, of course, but your time may
be better spent exploring what many in the industry call the next best thing --
student loan forgiveness programs. A number of organizations, both private and
public, offer college graduates a chance to reduce or eliminate their student
debt in exchange for years of service.
"I imagine there
are a large number of people who don't know these programs exist," said Kalman
Chany, president of New York-based Campus Consultants and co-author of "Paying
for College Without Going Broke." "I wouldn't let loan forgiveness dictate
your career path, but if you qualify it may be something you want to look into."
The military, for one, offers loan payback programs for those
who enlist in the Army, Navy or Air Force after college. For each year of active
duty, the service branch makes a payment of 33½ percent or $1,500, whichever
is greater, on your total remaining principal balance. The Army and Navy will
repay up to $65,000 in student loans. The military's Web
site offers information on student loan repayment programs.
service in the Peace Corps and AmeriCorps can also help chip away at your debt
burden, while providing countless social rewards.
part, the Peace
Corps allows volunteers to reduce their outstanding balance on Perkins loans
by up to 15 percent for each year of service. It also offers deferment of Stafford,
Perkins, Direct and consolidation loans. AmeriCorps,
the domestic arm of the Peace Corps, offers up to $4,725 in education awards for
each term of service, along with modest living expenses.
in an underserved school system, meanwhile, could eliminate your loans altogether.
Details are available at the Department of Education's Web
Lawyers can also get help. Law schools provide loan
repayment programs to graduates who serve in the public interest or work for nonprofit
groups. The Equal Justice Works has more information on its Web
Same goes for doctors who agree to practice in communities
where health professionals are few and far between. The National
Health Service Corps, under the Department of Education, will pay up to $50,000
for two years of service, based on the participant's outstanding loan balance.
A quick search on fedmoney.org,
a free Web site of all government grants and loan programs, provides a laundry
list of other employers offering similar loan forgiveness incentives -- just in
case that rich uncle never shows up.
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