Buy Back — Loans

: Borrowers can "buy back" months they were in deferment or forbearance so those months count toward the 120 qualifying payments required for forgiveness.

: If a borrower defaults or delays payments for a specific period (typically 30, 60, or 90 days), the loan originator is contractually obligated to buy back the loan from the investor.

: The security of this "guarantee" depends entirely on the financial health of the Loan Originator or its parent company. 2. Corporate Debt Buybacks buy back loans

: You must have an outstanding Direct Loan balance and documented qualifying public service employment for the months being repurchased.

A specialized version exists for federal student loan borrowers through the U.S. Department of Education . : Borrowers can "buy back" months they were

: This allows the debtor to reduce total outstanding obligations while providing creditors with an immediate, one-time payment.

: The originator typically returns the nominal capital (principal) plus any accrued interest to the investor, shielding them from the borrower's default risk. Department of Education

Large corporations use buybacks as a tool for Liability Management .