Teaching can be a rewarding profession, but teachers are often overworked and underpaid. With the average borrower owing nearly $ 40,000 in student loans, it’s easy to see how educators struggle with paying off student debt. Fortunately, teachers have many options when it comes to student loan forgiveness.
What is Student Loan Issuance for Teachers?
Student loan waiver is a program in which the federal, state, or local government (or other organization) cancels either all or part of your student loan balance.
One of the benefits of teaching is that you may have access to several student loan allocation programs. Eligibility requirements vary, but some programs cancel your debt in just a few years.
What are the requirements for obtaining student loans for teachers?
Each teacher student loan program has different eligibility requirements. For example, some award programs are only available if you work at an eligible public school or teach a specific subject. Other award options can be more lenient in this area.
A common requirement, especially with state loan programs, is that your student loans must not be in default. The potential loss of student loan benefits is just another reason why it is so important to keep up with your student loan repayment plan.
Types of Lending Programs
Below are three teacher student loan forgiveness options that could potentially save you a bundle.
Forgiveness of teacher loans
Eligible teachers may be able to use up to $ 17,500 on their state student debt through the teacher loan program. The program works for direct or FFEL loans (subsidized or unsubsidized) and may be available once you’ve been a full-time teacher for five or more years.
- Requirements: You must work full-time in an eligible low-income school or educational institution. Your full-time employment must include at least five completed and consecutive years of study. At least one of these years must be after the 1997-98 school year.
- Advantages: Qualification for the Teacher Loan Forgiveness Program does not prevent you from receiving additional benefits through the Public Service Loan Forgiveness Program.
- What to look out for: You must be a “highly qualified teacher” in math, science, or special education to qualify for the full $ 17,500 in forgiveness. Other teachers may qualify for loan waivers of up to $ 5,000.
Public sector lending
If you work as a full-time teacher, you may also be eligible for the Public Service Loan Forgiveness (PSLF) program. This program can potentially pay off up to 100 percent of your remaining federal student loan (direct loan or direct consolidation loan) debt after working for a qualified government or nonprofit for at least 10 years.
- Requirements: You must have worked full-time for a government (federal, state, local, or tribal organization) or a nonprofit organization for at least 10 years. During that time, you’ll also need to enroll in an income-based repayment plan and make 120 qualified, on-time payments for the student loan.
- Advantages: Teachers in public and private schools (non-profit schools) are eligible for the program.
- What to look out for: PSLF does not work for personal student loans or all state student loans. If your federal student loans are ineligible, you will need to consolidate your accounts into a direct loan in order to qualify.
Termination of Perkins Teacher Loan
Until 2017, Perkins loans were available to certain undergraduate and graduate students with financial needs. You will no longer be able to get these student loans, but if you are a teacher with existing Perkins loans these can be terminated up to 100 percent over a five year period.
- Requirements: You must have a Perkins loan and be a full-time teacher in a qualifying low-income school. Alternatively, you can still be canceled if you are teaching science, math, a foreign language, bilingual education, or special education. In certain federal states with a shortage of teachers, you can qualify if you also teach another subject.
- Advantages: Teachers at non-profit private schools can be entitled to forgiveness, depending on whether the school offers qualifying training within the meaning of state law.
- What to look out for: If you are eligible, your credits will not be canceled all at once. Instead, 15 percent of your student loan will be canceled each year in the first and second years of doing an eligible apprenticeship. Another 20 percent of your credit will be canceled in the third and fourth year of each year. Finally, 30 percent are dismissed after the fifth year of eligible employment.
Can You Combine Lending Programs?
Many programs allow you to combine forgiveness plans to maximize your forgiveness. At the federal level, for example, you can be awarded up to a certain amount as part of the Teacher Loan Forgiveness program. If you have any more, you can apply for a public service loan – although any payments you made during your five years of teaching for teacher loans do not count towards the public service loan.
If you’re applying for loan relief at the local or state level, review the requirements to make sure they don’t interfere with other loan relief plans.
What states have programs that offer teacher loan relief programs?
Aside from the federal student loan allocation programs mentioned above, you should take the time to research available teaching services in your state and local area. In some cases, you can even combine multiple teacher student loan programs and increase the savings potential.
You can use the American Federation of Teachers database to see if your state or local government offers separate award options. Some programs include, but are not limited to:
- Mortgage Assistance Program for Teachers (Connecticut).
- The Illinois Teachers and Childcare Teachers Loan Repayment Program.
- Oklahoma Teacher Shortage Employment Incentive Program.
- Loan from the math and science teacher in Tennessee.
- Virginia Teaching Scholarship Program.
- Educators for the Maine Program.
- Missouri Minority Scholarship.
- Arkansas State Teacher Education Program (STEP).
Not only should you ensure that you qualify for the program, but you should also ensure that you submit your required documents on time. Some programs are offered on a rolling basis while others have a timeframe in which to submit your application.
If you currently cannot afford to meet your regular repayment schedule and do not qualify for existing teacher loan programs, you can speak to your student loan administrator about forbearance or deferment options. Depending on your financial situation and the size of your household, income-based repayment plans may also be considered.