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- There four main programs for teachers to get their student loans forgiven.
- Teacher student loan forgiveness programs only apply to federal loans, not private loans
- Read eligibility requirements carefully, as not all loan forgiveness programs for teachers are equal.
Teaching is a noble profession. It can also mean taking on student loans to get the degree you need for the job you want. The government has four federal student loan forgiveness programs that teachers can tap into to light their debt load. They each have unique eligibility requirements and provide a variety of levels of forgiveness.
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What is teacher student loan forgiveness?
The Teacher Loan Forgiveness Program allows those who teach full time for five complete and consecutive academic years in a low-income school or educational service agency to be eligible for forgiveness of up to $17,500 on Direct Subsidized and Unsubsidized Loans and Subsidized and Unsubsidized Federal Stafford Loans.
The Teacher Loan Forgiveness (TLF) Program was created by the Higher Education Amendments of 1998, which amended the Higher Education Act of 1965 (HEA). There are several requirements to qualify for forgiveness, including having completed five consecutive academic years as a classroom teacher at a Title 1 school.
Other programs include the Public Service Loan Forgiveness (PSLF), which forgives the remaining balance on federal Direct Loans after 120 qualifying payments (estimated over 10 years). The Perkins Loan Cancellation for Teachers forgives up to 100% of Federal Perkins Loans if the debtor teaches full-time at a low-income school or teaches certain subjects. State-Based Forgiveness Programs are offered by states, particularly in high-need areas.
What types of teacher student loan forgiveness programs are available?
There are a variety of teacher student loan forgiveness programs available. They include:
Teacher Loan Forgiveness (TLF) forgives up to $17,500 of Direct or Federal Stafford Loans after five complete and consecutive years of teaching at a qualifying school. Qualifying schools include low-income elementary schools, secondary schools, and educational service agencies (ESAs).
Public Service Loan Forgiveness (PSLF) forgives the remaining balance on federal Direct Loans after 120 qualifying payments (estimated over 10 years). They don't require teaching at a low-income public school. Instead, PSLF requires that working for a qualifying employer such as government organizations at any level and not-for-profit organizations.
Perkins Loan Cancellation for Teachers forgives up to 100% of federal Perkins Loans if the debtor teaches full-time at a low-income school or teaches certain subjects.
State-based forgiveness programs are offered by states, particularly in high-need areas.
How can I get teacher student loan forgiveness?
How to get Teacher Loan Forgiveness
To qualify, you must not have had an outstanding balance on federal Direct Loans or Federal Family Education Loan (FFEL) program loans as of Oct. 1, 1998, or on the date that you obtained a direct Loan or FFEL Program loan after Oct. 1, 1998.
You must have been employed as a full-time, highly qualified teacher for five complete and consecutive academic years, and at least one of those years must have been after the 1997–98 academic year. You must have been employed at an elementary school, secondary school, or educational service agency that serves low-income students. A directory for low-income schools may be found here.
The loan(s) for which you are seeking forgiveness must have been made before the end of your five academic years of qualifying teaching service.
You apply for teacher loan forgiveness by submitting a completed Teacher Loan Forgiveness Application to your loan servicer. The chief administrative officer of the school or educational service agency where you performed your qualifying teaching service must complete the certification section. If you are applying for forgiveness of loans that are with different loan servicers, you must submit a separate form to each of them.
How to get Public Service Loan Forgiveness
To qualify for PSLF, you must be employed by a federal, state, local, or tribal government or qualifying not-for-profit organization. You must work full-time and have Direct Loans, or consolidate other federal student loans into a Direct Loan. You have to make 120 qualifying monthly payments that need not be consecutive and repay your loans under an income-driven repayment plan or a 10-year Standard Repayment Plan.
It will take at least 10 years before you can qualify for PSLF, and you must still be working for a qualifying employer at the time you submit your form for forgiveness.
You can submit the application form digitally through the PSLF Help Tool or manually, using a paper form. You can use the PSLF Help Tool to complete the form, send it to your employers for their digital signature certifying your employment, and electronically submit it to the PSLF servicer for processing.
How to get federal Perkins Loan cancellation for teachers
To qualify for cancellation of up to 100% of a federal Perkins Loan, you must have served full-time in a public or nonprofit elementary or secondary school system as a teacher in a school serving students from low-income families; be a special education teacher; or teacher in the fields of mathematics, science, foreign languages, or bilingual education, or in any other field of expertise determined by a state education agency to have a shortage of qualified teachers in that state.
Eligibility for teacher cancellation is based on the duties presented in an official position description, not on the position title. To receive a cancellation, you must be directly employed by the school system. There is no provision for canceling federal Perkins Loans for teaching in postsecondary schools.
For each full academic year of full-time teaching, you are eligible to have a portion of your loan canceled. There is no requirement that you must teach a given number of hours a day to qualify as a full-time teacher; the employing school is responsible for making that decision.
You can have your loan canceled if you are simultaneously teaching part time in two or more schools, and your loan can also be canceled for services performed in a private school or preschool.
If you are eligible for cancellation under any of the categories listed above, up to 100% of the loan may be canceled for teaching service, in the following increments:
- 15% canceled per year for the first and second years of service
- 20% canceled for the third and fourth years
- 30% canceled for the fifth year
Under certain conditions, your Perkins Loan may be discharged, meaning you don't have to pay it back. Conditions that may lead to discharge include:
- Bankruptcy
- Death
- School closure
- Veterans
- Spouse of a victim of the events of 9/11
- Total and permanent disability
Application for Perkins Loan forgiveness are made through the school that made the loan or its Perkins Loan servicer. They will provide forms and instructions to guide you through the process.
How to get state-sponsored student loan forgiveness
Many states offer loan forgiveness programs for teachers, especially in high-need areas. Reach out to your state's education agency for more details.
Maximizing teacher student loan forgiveness
Through the end of 2023, teachers are able to double dip using Teacher Loan Forgiveness and Public Service Loan Forgiveness if they have used their Teacher Loan Forgiveness eligibility from the past, according to David Gourley, a financial planner with Teach Plan Retire, which helps teachers with their financial planning.
The most advantageous student loan forgiveness for many teachers is the Public Service Loan Forgiveness program as it requires just that they work in public service and is not tied to a Title 1 school employment.
"One thing that I'm having many of my clients do right now is consolidate their loans if they have old loans and new loans," Gourley says. "There is a waiver called the IDR waiver that will allow the longest repayment history to count on all consolidated loans. This means that if someone has 100 credits towards PSLF on old loans and 10 credits on their new loans, they could consolidate them together and get the 100 credits on all of their loans."
There are lots of ways to manage payments, especially if borrowers are married. Any pre-tax money helps lower your tax bill, which in turn lowers your student loan payment. Contributing to a 403(b)/457(b), health savings account, or flexible spending account can lower the amount that someone will owe on their student loan payment on an income-driven repayment plan.
If you are working toward Public Service Loan Forgiveness, you can use a PSLF payment track ser such as Mohela's to keep track of which months count for credit towards PSLF and which ones don't (or still need employment verification).
"It is a great tool to keep track of repayment history," Gourley says.
Make sure to keep track of your payments and documentation. Applying for forgiveness programs can require documentation that can be hard to replace.
Teacher student loan forgiveness frequently asked questions
Can I qualify for multiple teacher loan forgiveness programs simultaneously?
Through 2023 teachers are able to double dip using Teacher Loan Forgiveness and Public Service Loan Forgiveness if they have used their Teacher Loan Forgiveness eligibility from the past.
How do I know if my school qualifies as a low-income school?
You can check the directory on the federal government's student aid website to see if your school qualifies.
Is teacher loan forgiveness taxable?
Public service loan forgiveness and teacher loan forgiveness are not taxable.
Can private school teachers qualify for loan forgiveness?
Public Service Loan Forgiveness is available to not-for-profit organizations, which include many private schools. A private school, college, or university that operates as a for-profit organization wouldn't qualify as a qualifying employer.
How long does it take for loan forgiveness to be approved?
Public Service Loan Forgiveness processing times vary depending on when you submitted documentation, how many employers you've had, and any required follow-up. You're not required to make payments while your application is processed. Teacher Loan Forgiveness program processing time is two to three months.