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Student Loan Forgiveness is not a reduction in debt principal, it is like a payment clock. Whatever amount of debt is left over after the clock runs out is completely forgiven. So in a nutshell, it is our job to leave as much debt left over to be forgiven as humanly possible.This is all depending on the amount of debt, of course. Someone who only owes $10,000 for instance might not ever see any forgiveness.

Short answer: It won't affect your score

1) If a consolidation is necessary to change your loan types or whatever the reason, what is essentially happening is that we are moving debt around. We are not adding or taking it away therefore your credit will not be affected

2) If we are changing your monthly payment, your credit still will not be affected. The reason is that no matter what the payment goes to (even $0), you will still be current and up to date, ensuring your credit score will remain intact.

No, student loan forgiveness is not taxable income at the federal level from December 31, 2020 to January 1, 2026. However, some states may tax forgiven student loans. 

Explanation:

● The American Rescue Plan Act of 2021 temporarily excludes forgiven student loans from gross income. 

● This means that borrowers who receive student loan forgiveness during this period will not have to pay federal income taxes on the forgiven amount.  

● However, some states may still tax the forgiven amount. 

● You can consult a tax professional for more information. 

What about other forgiveness programs?

● Student loan amounts forgiven under the Public Service Loan Forgiveness (PSLF) program are not considered income for tax purposes. 

● The taxability of discharged student loan debt due to borrower defense may vary.

Yes, interest continues to accrue on your student loans even if you are not currently making payments, unless you have a specific type of subsidized federal loan where the government pays the interest while you are in school; in most cases, interest accrues daily on your student loan balance from the moment the loan is disbursed until it is paid off in full. 

Key points about student loan interest:

Accrual while in school:

For unsubsidized federal loans and most private loans, interest accrues even while you are still enrolled in school. 

Subsidized loans:

For subsidized federal loans, the government pays the interest while you are enrolled in school. 

Deferment and forbearance:

During periods of deferment or forbearance, interest typically continues to accrue on most loans, although the terms may vary depending on the loan type and lender. 

Capitalization:

If interest accrues while you are not making payments, it can be "capitalized" and added to your principal loan balance when you start making payments again. 

Yes, PSLF forgiveness is available to any borrower who has been working for 30+ hours a week for a qualifying employer for 120 months (10 years). This program requires borrowers to have the correct loan type, be enrolled in an income driven repayment, and have HR complete the PSLF form to verify borrower employment.  

Note: If the qualifying and enrollment process is not done correctly a borrower can be denied; without any explanation to why.

We charge 30% of the amount we save you in the first year of working with us. This fee covers all of our services for the period of one year from the date you decide to work with us. This includes all document preparation, a custom student loan plan, all questions answered, expert advice, as well as up to date changes in the laws that might affect you and your plan.

The yearly recertification fee is $250 - 450, a significantly reduced fee for existing clients who prefer “peace of mind” knowing they will continue receiving monthly payment relief and loan forgiveness credit.

Absolutely not! Any money paid to K2DF is a fee in exchange for our services and it will not go toward your student loans. You will still be responsible to pay your servicer each month if you have a payment owed.

Side note: if you are investigating companies, stay far away from any company that promises to pay your loan for you, that is not only illegal but a safe way to wind up in serious hot water.

Yes you could do a consolidation yourself at StudentLoans.gov. However - do you know when to do consolidation? Do you know when doing a consolidation could hurt you? Do you know the dangers and pitfalls in the application itself?

Yes, you can even do an Income-Driven Request on your own. But do you know the best repayment plan, the right loan servicer, and different ways to show income to ensure you get the lowest payment and the shortest forgiveness period?

What happens if you make a mistake? Or even worse, if you do everything correctly and the servicing companies make a mistake (this happens about 30% of the time). Do you know what to do then? Are you going to keep up with all the changes and be on time to recertify every year (50% of people who put themselves in these programs fall out for not recertifying, these are real statistics you can look it up!)

The bottom line is that you can do this yourself. You can also do your own taxes, your own electrical work, and represent yourself in a court of law. However in these scenarios, you might want to seek professional help. Let us ask you - what could you have to gain in having a free consultation with one of our student loan experts?

If your student debt is private; then yes, it’s recommended you pay those loans first; since there are no relief plans available; and often have high interest rates.  K2DF consultants advise on strategies that will expedite payoff of private debts.

Federal student loans have payment relief and forgiveness options available to qualifying borrowers.  To determine eligibility schedule a consultation with a K2DF consultant to find which relief options are available to you.

Yes, in our opinion, Federal Student Debt is good, and Private Student Debt is bad. Simply because private debt is so much more difficult to deal with.

Tip:

Never EVER refinance and turn a Federal Student Loan into a Private Student Loan!!!  You will no longer be eligible for any payment relief or forgiveness programs.  Before you do this, set up a consultation with K2DF to find out how to qualify for relief. 

Yes, credit repair can work if your credit report contains errors or inaccuracies that are negatively impacting your score. By identifying and disputing incorrect information, you may see improvements in your credit profile. However, legitimate credit repair cannot remove accurate negative items.

At Key 2 Debt Free, we help you navigate the credit repair process and develop strategies for long-term financial health. Contact us today for expert guidance on improving your credit!

The best way to repair your credit is to review your credit report for errors, dispute inaccuracies, and practice responsible credit habits like making on-time payments and keeping credit utilization low.

If you need assistance disputing errors or improving your financial profile, Key 2 Debt Free offers expert support to help you take control of your credit. Schedule a consultation with us today to start rebuilding your financial future!

Being bankable means having a strong financial profile that proves to lenders you are a low-risk investment, making it easier to qualify for loans and better financing options. This includes maintaining a solid credit score, demonstrating financial stability, having a well-structured business plan, and building a positive relationship with banks.

At Key 2 Debt Free, we help individuals and business owners improve their bankability, ensuring they have the financial foundation needed to secure funding. Contact us today for expert guidance!

To improve your bankability, start by boosting your credit score, maintaining accurate financial records, and developing a clear business or financial plan. Lenders also look for consistent income, personal investment in your business, and available collateral to secure loans.

At Key 2 Debt Free, we provide tailored strategies to enhance your financial profile, increase loan approval chances, and secure better terms. Schedule a consultation today to take control of your financial future!

If you’re enrolled in the SAVE Plan, your loans are in general forbearance until loan servicers can accurately bill you, expected no earlier than September 2025. During this time, you don’t have to make payments, interest won’t accrue, but the time won’t count toward PSLF or IDR forgiveness.

If you’re in SAVE Plan forbearance, payments are paused, interest won’t accrue, but the time won’t count toward PSLF or IDR forgiveness. If you’re in processing forbearance (up to 60 days), interest accrues, but the time counts toward PSLF and IDR forgiveness.

Yes, you can still apply for IBR, ICR, PAYE, and SAVE, but forgiveness under SAVE, PAYE, and ICR is currently blocked due to a court ruling. Loan servicer’s are processing IDR applications for IBR, ICR, and PAYE, while SAVE applications remain on hold with possible processing delays.