Skip to main content

Incarcerated Borrowers

image of motarboard cap behind prison bars

Student Loan Debt Relief for Incarcerated Borrowers

Federal student loan borrowers struggling or unable to make payments while incarcerated should know about the debt relief options described below. Borrowers and their families can also connect with the Student Borrower Protection Center for more information at 1025 Connecticut Ave NW, #717. Washington, DC 20036. The Student Borrower Protection Center does not provide legal representation to individual borrowers, but we will attempt to connect you with resources and additional support.

A “Fresh Start” for Federal Student Loan Borrowers in Default

Recently, the U.S. Department of Education (ED) announced that it will eliminate the negative effects of default and restore eligibility to receive federal student aid for certain borrowers who are in default on their federal student loans. This “Fresh Start” initiative will make incarcerated borrowers with federal student loans in default eligible for federal student aid, including Pell Grants for prison education programs (PEPs).

All other borrowers with previously defaulted student loans who do not seek enrollment in a PEP must begin repayment on their loans within one year of the end of the federal student loan payment pause, or risk experiencing the consequences of default once that one year period ends. Borrowers with no or very little income may be eligible for an income-driven repayment (IDR) plan, with a payment as low as $0 per month. These borrowers should enroll in an income-driven repayment plan at https://studentaid.gov/idr, by visiting myeddebt.ed.gov, contacting their loan holder by phone or in writing, or calling the Default Resolution Group at 1-800-621-3115 as soon as possible.

Qualifying incarcerated borrowers in default who seek to enroll in qualified PEPs will be automatically eligible to apply for federal student aid to help them complete their course of study. These borrowers may apply for financial aid through the Free Application for Federal Student Aid (FAFSA), even before Fresh Start is fully implemented later this year.

Incarcerated borrowers with federal student loans in default who enroll in PEPs qualified to receive Pell Grant funds will have their loans automatically transferred out of default and into in-school deferment status for as long as they are enrolled. After incarcerated students complete or discontinue their PEPs, they must begin repayment on any prior federal student loans to stay out of default.

Borrowers with defaulted loans in the following programs are eligible for Fresh Start:

  • Defaulted William D. Ford Federal Direct Loan (Direct Loan) Program loans
  • Defaulted Federal Family Education Loan (FFEL) Program loans (both ED-held and commercial-held)
  • Defaulted ED-held Perkins Loans

Federal Student Loan Debt “Write-Offs”

The Department has said it will “write-off” the federally-held student loans of borrowers whose sentences are 10 years or longer, meaning they would no longer owe the loan. Borrowers should note that this write-off will make them ineligible for federal financial aid programs, such as Pell Grants. Borrowers whose loans are written off using this policy may later restore their eligibility for federal financial aid programs by making repayment arrangements with the Department to have their debt reinstated.

Incarcerated borrowers seeking to write-off their federal student loan debt should mail the following list of information to the Department at U.S. Department of Education PO Box 5609 Greenville, TX 75403-5609. The Department may also be reached at (903) 259-3877. This information should be provided on the prison’s letterhead and be signed by a prison official. The letter should include:

  • Borrower’s full name
  • Borrower’s Social Security number
  • Borrower’s full date of birth
  • Borrower’s inmate number
  • Borrower’s release date or date of eligibility for parole (whichever is sooner)
  • Contact information for a prison official able to verify the above information, including:
    • Prison official’s name
    • Prison official’s title
    • Prison official’s phone number
    • Prison official’s signature

While the Department does not make the requirement for this “write-off” public, it appears that borrowers must apply while still incarcerated.

Temporarily Stop Collection of Federal Student Loans in Default

Borrowers who are incarcerated and behind on their federal student loan payments may be eligible to have collections activities paused until they are released. Incarcerated borrowers should ensure that the Department’s Default Resolution Group has verification of the borrower’s incarceration by mailing the following information, on the penal institution’s letterhead, to U.S. Department of Education Default Resolution Group P.O. Box 5609. Greenville, TX 75403-5609. The Default Resolution Group may also be reached at (903) 259-3877. Your letter should include:

  • Borrower’s full name
  • Borrower’s full date of birth
  • Borrower’s earliest release date
  • Prison or institution facility address
  • Borrower’s social security number
  • Borrower’s inmate number
  • Borrower’s release date or date of eligibility for parole (whichever is sooner)
  • Contact information for a prison official able to verify the above information, including:
    • Prison official’s name
    • Prison official’s title
    • Prison official’s phone number
    • Prison official’s signature

Income-Driven Repayment

Borrowers who are not behind on their loans may be able to enter a repayment plan where their monthly bills will be set based upon their income. For borrowers with no or very little income, the monthly payment amount on these plans can be as low as $0. Borrowers should also know that if their financial situation changes, they can request a recalculation of the monthly payment amount at any time. Importantly, borrowers who have no income when they apply can certify that they have no taxable income by simply checking a box on the form. Incarcerated borrowers who are not behind on their loans should enroll in an income driven repayment plan at https://studentaid.gov/idr/ as soon as possible. 


More information about debt relief for incarcerated federal student loan borrowers is available at the National Consumer Law Center’s Student Borrower Assistance Project: Incarceration

A non-exhaustive list of legal resources to assist student loan borrowers whose incomes fall below certain amounts is available at the National Consumer Law Center’s Legal Resources.

To learn more about the unique challenges facing incarcerated student loan borrowers and what steps the Department of Education can take to solve them, read our report: Collection At All Costs: Examining the Intersection of Mass Incarceration and the Student Debt Crisis

Join our mailing list Stay informed on the fight to protect Americans with student debt

  • This field is for validation purposes and should be left unchanged.