Sallie Mae (Student Loan Marketing Association) loans issued by SLM Corporation (SLM) similar to other private loans, cannot be forgiven. As of 2017, there is no option for private student loan forgiveness, but there are options for public student loan forgiveness. If a person needs relief from his Sallie Mae loans, there are options other than forgiveness. Note: When we say "Sallie Mae loan," we are referring to a loan that originates with the agency; Sallie Mae also administrates federal direct student loans (confusing, we know).
Talk to the Lenders
The first step is to speak directly with the lender. Sallie Mae, for example, has forbearance options for those needing it. By using this option, a person is able to temporarily pause loan payments without facing delinquency. A loan can only be in forbearance for up to 12 months.
Refinancing/Consolidating the Sallie Mae Loan
By consolidating multiple loans, a person is often able to get a better interest rate. Doing so not only means lower monthly payments (obviously), but it also saves a lot of money over the entire life of the consolidated loan, reducing long-term financial stress.
Private student loans can only be refinanced or consolidated with other private loans, and public loans with other public loans. Unfortunately, Sallie Mae no longer offers private loan consolidation. Students can still consolidate their Sallie Mae and other private loans through a private financial institution. In that case, the consolidated loan and resulting payment plan are managed by that institution.
Public loans administered through Sallie Mae can be consolidated with other student federal loans. The agency used to allow student-borrowers to apply for the consolidation of federal loans directly, but this is no longer the case: They now have to apply directly to the U.S. Department of Education's Federal Student Aid division. Sallie Mae can continue to manage the new Federal Consolidation Loan, if the borrower wishes.
Look at Federal Student Loan Repayment Options
Sallie Mae loans can't be refinanced, either. However, for those who have both private and public student loans, it is possible to use the special programs offered to give relief to federal loans, and then apply those savings to the Sallie Mae loan. Some people in this situation apply for a federal income-based repayment plan and use the extra capital to pay off the Sallie Mae loan. These options are also available for federal consolidated loans.
First, a student can elect for graduated repayment, which is a loan that has lower monthly payments initially, which increase gradually over a 10-year period.
Students can opt for an income-based repayment plan. This plan caps monthly payments at a discretionary income level of 10% or 15% (depending if your loan originated before or after July 2014). However, to be eligible for this type of plan, students must prove financial hardship.
A student who has an outstanding loan balance of more than $30,000 is eligible for an extended repayment plan. This plan extends the life of the loan to 25 years, with monthly payments based on a low fixed or graduated repayment amount.
Also, some lenders allow for unemployment protection that puts payments on pause if a person loses his or her job.
For related reading, see "'My Student Loans Will Be Forgiven by the Government': Really?"