Personal Finance

Student loan forgiveness options are growing. Here's how to find them

Key Points
  • As student debt poses more problems for people, states and the federal government are rolling out more solutions.
  • There are now more than 100 student debt assistance programs across the country.
  • Meanwhile, more companies are adding a benefit to help workers with their education loans.

As student debt poses more problems for people, states and the federal government are rolling out more solutions.

There are now more than 100 student debt assistance programs across the country.

For example: Certain nurses, doctors and social workers in Michigan could be eligible for up to $200,000 in student debt forgiveness, if they work in high-need areas.

Meanwhile, the Army will wipe out thousands of dollars in student debt each year for soldiers in the National Guard.

Even borrowers with private loans could be eligible for many of the state-run student loan assistance programs, said Will Sealy, co-founder and CEO of Summer, which helps people navigate their student loan repayment.

3 ways to get other people to pay off your student loans
3 ways to get other people to pay off your student loans

Meanwhile, student loan assistance, which started as a niche offering by a handful of companies, is finding its way into the mainstream menu of workplace benefits.

Some of the other ideas are pretty creative: New Jersey, for example, considered establishing a lottery for borrowers burdened by student debt.

The South Korean auto maker Hyundai announced recently that it will give $900 to people with student debt who buy or lease a car from them. (The offer is available only at dealerships in California and Phoenix, Arizona, right now.)

Keep in mind, however, that these endeavors aren't free. The funds are taxable, even money from an organization in return for volunteer work.

"All money you receive for volunteering is considered income by the IRS," said Mark Kantrowitz, a student loan expert.

Here are some of the ways to get other people to pay off your debt.

1) Federal and state government programs


Summer recently launched a tool called Forgiveness Finder, where you can search for relief options in your area. It's free to use.

One federal program offers up to $75,000 in student loan relief for those who work for three years in the health-care field, battling the opioid epidemic.

To attract younger residents, Maine is offering student debt relief to graduates who live and work in the state.

The details of the program vary based on when you graduated and whether you are from Maine or elsewhere. But generally, people are able to subtract their total student loan payments over the year from their state income tax liability. So if you owe the state $2,000 in state income taxes and you paid $1,800 in student loans, you'll owe Maine just $200.

More from Personal Finance:
Here's how to retire abroad — without any tax surprises
Tax cuts trump market's recent volatility for most Americans: study
ill to halve number of homeowners claiming mortgage deduction

The town of Newburgh Heights, Ohio, has another offer for student loan borrowers.

If you're a graduate from a four-year accredited college or university and purchase a house in the town valued at $50,000 or more within five years of graduating, the town will pay off half of your student debt, up to $50,000.

There are two payouts, 80% at the 10-year mark and the final 20% after 15 years. Even if you've paid off your student loans by that time, you'll receive the funds for the amount you owed when you first enrolled in the town's program.

2) At your job

Wang Zhao | AFP/Getty Images

"We're certainly seeing more and more employers interested in offering student debt benefits to their employees," said Asha Srikantiah, head of Fidelity's student debt program.

Companies that have offered employees help with their student loans include Aetna, Penguin Random House, Nvidia and Sotheby's.

A spokesman for Fidelity said more than 75 companies — including U.S. defense contractor Raytheon and The Travelers Companies — are currently using its student debt employer contribution program. (Fidelity also offers a student debt benefit for its own employees.)

Although the company you're interviewing with most likely won't offer the benefit, that shouldn't stop you from asking about it, said Katie Berliner, account executive at YouDecide, a benefits firm.

"In the course of the interview, there comes a point where the interviewer says, 'Do you have any questions?'" Berliner said. "It would not be out of line to say: 'I want to get your perspective on whether you think this a valuable benefit.'"

3) Volunteering

Borrowers can enroll with Shared Harvest Fund, and get financial help in return for volunteering.

Users create a profile and list the social causes they're interested in, such as gender equality or homelessness. You'll work on projects for nonprofits and businesses and receive a monthly stipend of $250 to $1,000.

4) Apps

With the holidays approaching, you may want to register your student loan account with Gift of College, an education registry, and then share your profile with friends and family, who can contribute funds directly to your debt.

Nadine Perry, director of marketing at Gift of College, said: "Wouldn't you rather get Aunt Emma to kick in toward your student loans than give you another ugly sweater for Christmas?"