If you are a parent or guardian of a student who has died and they have outstanding student loans, the government will discharge the loans so that you are not held responsible for paying them back. Standard student loans and PLUS loans are discharged when the borrower, or in the case of PLUS loan, a parent dies.
The PLUS loan will also be discharged for the parent if the student who the loan was obtained for dies. While you may be eligible for a discharge of student loans in the event of a student’s death, you will need to take certain steps to ensure that the government has been notified about the event.
Filing Appropriate Documentation with the Federal Government
The lender that extended the student loan to the parent or individual will need to receive a copy of the death certificate by postal mail only. The U.S. Department of Education does not accept faxed documents, so you will need to make sure you provide a very clear and accurate photocopy of the original death certificate.
It’s also a good idea to find the most recent demand letter for the loan, which includes the outstanding balance and other identifying information about the loan. You will need to send a copy of the demand letter, the clear copy of the death certificate, and a short letter stating that you are seeking a discharge of the student loan because of a borrower’s death. All of this information can be sent via certified mail to the following address:
U.S. Department of Education
National Payment Center
P.O. Box 5609
Greenville, TX 75403-5609
It’s very important that the copy of the death certificate is flawless and is only a copy of the original. Providing as much supporting information as possible can speed up the loan discharge process and will ensure that your request is reviewed in a timely manner.
Student Loan Discharges for Private Loans
Unlike Federal loans that can be discharged when a borrower dies, private loans typically don’t offer student loan forgiveness upon a borrower’s death. These student loans are considered to be a private loan debt and will become a part of the borrower’s estate. This means that they may or may not be discharged during the estate settlement process, and the requirements for a complete or partial discharge will vary from state to state.
Still, some private lenders will consider and approve a discharge under certain circumstances. You will need to work directly with your lender to find out what the discharge process is, and if the borrower qualifies for a complete or partial discharge of the student loan because of their death.