If you have federal student loans and pass away, your family can apply for loan discharge due to death and have the remaining balance forgiven.

What happens to student loans when someone dies?

If all of your loans are federal student aid and in your name, then the outstanding balance will be wiped out through what’s called a “death discharge.” If a friend or family member sends a death certificate or other proof of death paperwork to your loan servicer, the loans will be cleared.

What happens to a education loan if the borrower dies?

Even if something catastrophic happened to me – including death. (Federal student loans are canceled if the borrower dies before the loans are paid off, even if the borrower had a cosigner.)

What happens if a spouse with student loans dies?

So, if the spouse with student loans dies, the surviving spouse doesn’t have to pay them back. Even if you were married when you took out the loans, only the spouse that took them out is on the hook for them.

Who is responsible for a spouse’s student loan debt?

First, one spouse isn’t liable for the other spouse’s loans taken out during college. For example, if the husband took out Federal student loans to pay for school, his wife isn’t responsible for the debt, even if they are married. So, if the spouse with student loans dies, the surviving spouse doesn’t have to pay them back.

How can I pay off my spouse’s student loans?

This can happen in several ways: Refinancing the debt with private student loans where both spouses are cosigners. By doing this, you make what was once an individual’s student loan, and make both spouses responsible. Using home equity to pay off the student loan debt.

What happens to Sallie Mae student loans after death?

Some private lenders, including Sallie Mae, will discharge or waive the current balance of the student debt after a borrower’s death. 3  Review your lending agreement to see if it provides any details about how private student loans are handled in the case of a death. If the lender doesn’t discharge the loan, the balance won’t go away.