Relief for Student Borrowers

These workarounds may help borrowers who are ill, whose school closed, or who have other college debt issues.

As college costs and student-loan interest rates continue to rise, many graduates and former students are struggling to repay their student loans. But new federal and state offerings are providing some borrowers in difficult situations with ways to avoid default.

Borrowers undergoing treatment for cancer can now defer payments on their federal direct loans during their treatment, without accruing interest on the loans. If you qualify, contact the company that services your loans to request a deferment. You may need to provide a letter from your oncologist.

Students who were enrolled at a college that closed may qualify to have their federal loan balance expunged. Roughly 15,000 borrowers who attended schools that shuttered from late 2013 to 2015 recently had their federal debts canceled. Students generally had to be enrolled at a now-defunct institution when it closed (or shortly before) without enrolling in another school for three years. For more details, visit (opens in new tab) and search “closed school discharge.”

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Your state may also be able to help. In recent years, several states, including California, Connecticut and Washington, have enacted legislation to protect student-loan borrowers or provide an ombudsman to help borrowers who are in trouble.

Kaitlin Pitsker
Associate Editor, Kiplinger's Personal Finance
Pitsker joined Kiplinger in the summer of 2012. Previously, she interned at the Post-Standard newspaper in Syracuse, N.Y., and with Chronogram magazine in Kingston, N.Y. She holds a BS in magazine journalism from Syracuse University's S.I. Newhouse School of Public Communications.