Student loan forgiveness programs can pay off education debt on teacher salaries. Several programs offer federal student loan forgiveness directly to educators.
“Teachers have more loan forgiveness opportunities than almost any other profession, and using these easy-to-register programs can save hard-working teachers hundreds of thousands of dollars,” says Robert Farrington, founder of College Investor. “Ignoring these opportunities is going beyond free money.”
However, it is possible to qualify for student debt relief. If you’re looking for student loan assistance as a teacher, here there’s what you need to know about forgiveness programs.key takeaways
- Some student loan forgiveness programs are designed just for teachers.
- Each loan forgiveness option has particular requirements, so it’s essential to look carefully to make sure the school you work at, your loan, experience, repayment plan, and more don’t disqualify you.
- While a HOUSE grant is not a loan forgiveness program, student teachers provide $4,000 in non-refundable grant money if they meet the program’s teaching requirements after graduation.
- Don’tDon’t forget to check your state loan forgiveness programs and ask if private student loan providers offer loan forgiveness.
Option no. Tip #1: Public Service Loan Forgiveness (PSLF)
The Public Service Loan Forgiveness Program was established in 2007 and is designed to provide student loan forgiveness to individuals who work in public service professions, including teachers. The minimum quality requirements for this program include:
- Work full time for a private government or nonprofit agency
- Past Due Direct Loans
- Be enrolled in an income-based payment plan
- Make 120 qualifying payments
It sounds simple enough, but there are some caveats for teachers. For one thing, this loan forgiveness program does not include teachers who work for nonprofit private schools. On the other hand, it isn’t easy to qualify for loan forgiveness, even eligible.
The problem became so bad that, in 2018, Congress implemented the Temporary Extended Forgiveness of Public Service Loans (TEPSLF) program to help some of the rejected borrowers. Still, few applications were also approved for that program. According to a Government Accountability Office (GAO) report, 99% of borrowers who applied for loan forgiveness were denied between May 2018 and May 2019, which kicked off first-year forgiveness eligibility. Reasons for denial include not being enrolled in the correct repayment plan and the loans not being eligible for the program.
Now, the American Federation of Teachers has filed a lawsuit against the Department of Education on behalf of teachers to resolve PSLF and provide an appeals process to address teachers who feel they have been maltreated. If you’re interested in public service loan forgiveness as a teacher, you’re interested in public service loan forgiveness. This tool asks about your employment and loans to see if you are eligible.
Option #2: Teacher Loan Forgiveness
- The Teacher Loan Forgiveness Program is another program available to teachers who have obtained federal loans. To be eligible for this program, a person must: Teach full-time for five complete, consecutive academic years at a school serving low-income students.
- You owe subsidized and non-certified Direct Loan Program loans and subsidized and non-certified Stafford loans.
- Become a highly qualified teacher with a bachelor’s degree and full state certification as a teacher.
This program offers loan forgiveness for up to $17,500 in eligible loan balances. The amount of loans you can forgive depends on the subject areas you teach. Full-time math and science teachers at the high school level, for example, can receive up to a maximum of $17,500.
In that sense, it is less generous than the Public Service Loan Forgiveness program, which does not limit the amount of student debt that can be forgiven. Technically, you can apply for forgiveness through the Teacher Loan Forgiveness program and the Public Service Loan Forgiveness program. Still, you can’t get loan forgiveness for the same period of teaching service.
To use both, you had to stack them, and first get teacher loan forgiveness, then public service loan forgiveness, says Mark Kantrowitz, editor and vice president of research. “However, this means it will take 15 years for your debt to be paid off in full, as opposed to just ten years under PSLF. The main advantage is if you’re not sure if you want to pursue a career in teaching if you’re forgiven sooner.” ” If you are interested in this program, you will want to find out if your school qualifies using the Department of Education’s program. Directory of Low-Income Teacher Layoffs.
The American Bailout Plan passed by Congress and signed by President Biden in March 2021 includes a provision that student loan forgiveness issued between January 1, 2021, and December 31, 2025, will not be taxed for the recipient.
Option #3: Termination of a Seconded Teacher from Perkins
If you took out loans from the now-defunct Perkins Loan Program to finance your education, you might be eligible to pay off 100% of those loans. However, there are some caveats.
To qualify, you must work full-time in a public or nonprofit elementary or secondary education system as a teacher serving students from low-income families. A special education teacher, STEM teacher, or a teacher concentrates on foreign languages, bilingual education, or any other discipline under siege. Loans for teachers employed by private schools can be canceled if the school has nonprofit status with the IRS and provides elementary or secondary education.
This program is only available to students who received their Perkins loans before the program ended in September 2017.
Option #4: TEACHER Scholarship
The HOUSE Scholarship is not loan forgiveness per se but an alternative to being considered a teacher seeking loan assistance. This grant is designed for students who are still working towards a teaching degree, either undergraduate or graduate. The program provides up to $4,000 per year in commissions. Still, as a condition of receiving the money, you must agree to teach in a high-need field at a school that serves low-income students for at least four complete academic years—within eight years of completing your degree. If you do not meet these requirements, the grant is a loan that must be repaid.
Option #5: State Administered Loan Forgiveness Programs for Teachers
Another way to get federal student loan forgiveness is to look at what the state government offers. You can use a database to search for forgiveness programs offered in your state. The state of Tennessee, for example, offers loan forgiveness to math and science teachers, while Illinois provides loan repayment assistance to educators and child care workers.
What About Private Student Loan Forgiveness?
Suppose you took out private student loans to pay for a college degree, whether forgiveness is available and under what terms will depend primarily on your lender. And if you can forgive your loans, it may only be in limited circumstances, like if you become permanently disabled or die. (His heirs are usually not liable if the loans are in his name only, but a co-signer would be responsible for the debt.)
If you have private loans that are hard for you to pay, you can do a few things to manage them. You could try refinancing your loans, for example, to get a lower interest rate and possibly a lower monthly payment. A lower rate can save you money over time if you pay less interest overall.
You can also contact your lender to see any hardship or buyout programs available if you have a temporary cash-flow problem. Again, whether those options exist and whether you qualify will depend on your choice of lender.
Baseline
Teachers can get private student loan forgiveness, but it’s essential to read the fine print on these various programs to make sure you qualify. “The most important thing to consider when deciding on which loan forgiveness program to join is the longevity of the teaching job itself,” says Farrington. “If the plan only teaches for five years, it reduces the number of programs to qualify for them. If this is the case, enrolling in the wrong plan may not provide the expected loan forgiveness.”