What Happens to Student Loans When You Die?

What Happens to Student Loans When You Die?

We are all familiar with Benjamin Franklin’s saying that “nothing is certain but death and taxes.” If you’re one of the 44.7 million people with student loan debt, you probably believe that student loans can be added to that quote. When you took out the student loans, the future was far from your thoughts. You may be just starting to pay back your student loans now, or perhaps you have been paying on them for a few years. Whatever the case may be, it’s time to look at what the future has in store for your student loan debt and if that debt ever goes away—even when you die.

Are They Forgiven?

If you have racked up a lot of student loan debt, you may feel like you will be making payments until you die. When that day comes, will the student loan debt be forgiven? It depends on the type of student loan.

Federal Student Loans

Federal loans are offered by the federal government. These types of loans have certain benefits including flexible payment options, deferment, and lower interest rates. Another advantage is that federal student loans will be discharged upon your death. Therefore, the debt acquired through this type of loan dies when you do.

Private Student Loans

Private student loans are offered by a bank or financial institution. These types aren’t as straightforward as federal loans. The fate of your private student loans after your death is highly dependent on the specific lender’s policy. Each lender has different discharge guidelines for circumstances including death. Also, having a co-signer on the policy is another factor to keep in mind.

Are They Passed Down to Family?

Since private student loans aren’t automatically discharged upon your death like federal loans are, you may wonder if your family will be burdened with paying off your debt. Again, it depends on the policy for your private loan. If you have a co-signer, they are obligated to pay the student loan debt. However, this has changed in recent years. Co-signers are released from any loans taken out after November 2018 under the Economic Growth, Regulatory Relief, and Consumer Protection Act

Are They Discharged in Bankruptcy?

Bankruptcy of any kind is not a quick and easy process, and it’s even more complex for student loan debt than standard debt. 

Federal student loans are unlikely to be wiped away in bankruptcy because they offer many payback options that work with your income and the ability to pay what you can. On the other hand, private student loans involve very few flexible payment options and may be more likely to be discharged.


Bankruptcy is a long process that could potentially lead to financial ramifications for the rest of your life. Therefore, examine all other options before considering this route.


The best time to look at student loan debt is before you take out the loans. Weigh the pros and cons of both federal and private loans. Check out the different lenders and policies, including what happens to the loan debt when you die. Taking the time to review the details now will help you stay ahead of future debt and gain financial freedom. If you have student loan debt, use Lume’s streamlined interface to manage your loans. To get started, sign up for the waitlist at uselume.com.

Joanne Potter BSN, RN

Joanne Potter BSN, RN is a writer that specializes in health and wellness. She has fifteen years of experience as a Registered Nurse in the NICU (Neonatal Intensive Care Unit). Her years working at the bedside and extensive neonatal knowledge enable her to write with a deep understanding of what health providers and parents want from their community.

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