You may ask: What is teacher loan forgiveness? Is it even the best option to handle my student loan debt? Read on to learn and get your quandaries solved. In this article, you shall read about what is teacher loan forgiveness. Also, you shall be exposed to available teacher loan forgiveness.
What is Teacher Loan Forgiveness Program?
Teacher Loan Forgiveness program is a student loan forgiveness program. It is initiated by the United States Department of Education. This program is intended to encourage individuals to enter and continue in the teaching profession.
This program enables students get their federal student loans forgiven. You may be eligible to receive loan forgiveness for your federal student loans if:
- As a teacher you provide direct classroom teaching.
- Provide classroom-type teaching in a non-classroom setting. It should be full-time for five complete and consecutive academic years. And should be in a Title 1 eligible school or school district.
Benefits of Teacher Loan Forgiveness
Teacher Loan Forgiveness Program is popular among teachers. It is popular among those looking for relief from their student loan debt. However, there are very specific requirements.
The program offers up to $17,500 in loan forgiveness. This is if you meet additional eligibility requirements. Also, it is after working five consecutive academic years as a full-time teacher. This should be in a low-income school or educational service agency.
For teachers outside of those requirements, you might still qualify for loan forgiveness help but only up to $5,000 total.
Eligibility for Teacher Loan Forgiveness Program
Below are some requirements for Teacher Loan Forgiveness:
- You must have taught full-time. At least for five complete and consecutive years. One of those years must have been after 1997–98.
- Also, you must be a highly qualified teacher employed at a qualifying school.
- Additionally, 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.
It is important you know this. If you are a highly qualified special education teacher you may qualify for up to $17,500 in forgiveness. Also, this applies to secondary mathematics or science teacher.
Other teachers can only receive up to $5,000 total in loan forgiveness. Please take note. Borrowers with PLUS loans and Perkins loans are not eligible to be forgiven through the Teacher Loan Forgiveness program.
Public Service Loan Forgiveness for Teachers
Teachers looking for student loan forgiveness options can look into this program. According to the Department of Education, PSLF “has the broadest employment qualification requirements of the federal programs listed”.
Also, it doesn’t require that you teach at a low-income a public school. It doesn’t require you to even be a teacher. Some full-time public and private elementary and secondary school teachers meets the employment requirements.
This is a form of Teacher Loan Forgiveness. PSLF is a federal student loan forgiveness. It’s open to anyone with qualifying Federal Direct Loans. Also, it’s for those who meets all the program requirements. The requirements are:
- Have student loans through any federal income-driven repayment programs.
- Make 120 qualifying payments on your student loan. A qualifying payment is one that is on-time and paid in full. Also, the 120 payments don’t need to be consecutive.
- Work for a government or qualifying non-profit organization the entire time.
- Another important step in qualifying for PSLF is this. Submit the Employment Certification for Public Service Loan Forgiveness form annually. Also, do this any time you change employers.
Repayment Plans that Qualify for PSLF
While considering Teacher Loan Forgiveness, please note. The repayment plans that qualify for PSLF are:
- Pay As You Earn (PAYE).
- Revised Pay As You Earn (REPAYE).
- Income-Based Repayment (IBR).
- And Income-Contingent Repayment (ICR).
Technically, the standard 10-year payment plan qualifies for PSLF as well. However, your student loan payments aren’t lowered within the standard repayment plan.
PSLF requires you to have direct loans. If your student loans are non-Direct federal student loans, please note. You would need to first consolidate them into a Direct Consolidation loan.
Also, if you have both types of loans, its best to only consolidate your non-direct loans. This is because any payments made on your direct loans prior to consolidating would no longer count toward your 120 loan payment count. While some student loan forgiveness programs are taxable, PSLF is not.
Forgiven loans aren’t considered income by the Internal Revenue Service (IRS). To apply, you need to fill out and submit the PSLF Application for Forgiveness.
Is PSLF a Better Option?
From the above, when considering Teacher Loan Forgiveness, PSLF is a better option. This is the reason. PSLF is less strict in regards to teaching qualifications. Also, it wipes out your entire student loan debt.
However, drawback to PSLF is that you need to make 10 years of qualifying payments. This is in order to be eligible. What if your career goals change or you decide to stop teaching? A lot can change in the life of a teacher in 10 years.
PSLF and Teacher Loan Forgiveness are the most common programs relied on for loan forgiveness. However, there are other options. Please note this. Picking the right option will depend on your specific situation. With all programs having benefits for certain teachers.
Other Teacher Loan Forgiveness Options
Teachers looking for relief from student loans have other options available. Below are some of the options available:
Federal Perkins Loan Cancellation
When considering Teacher Loan Forgiveness, please note. This is another option you can bank on. If you have Perkins loans, you can potentially have your loans canceled. It can be cancelled for up to 100%.
However , please note. In order to qualify, you must be: A teacher serving students of low-income families. Also, you must be a special education teacher.
This includes teachers of infants, toddlers, children, youth with disabilities, etc. Furthermore, you must be a math, science, foreign language or bilingual education teacher. Additionally, you must be a teacher in another field that is determined to have a shortage of qualified teachers in your state.
Income-Driven Repayment (IDR) Plans
When considering Teacher Loan Forgiveness, please note this option. Are you are a teacher who didn’t qualify for the previous forgiveness options? There is another way to get your loans forgiven.
You would need to move your student loan payments to one of the four eligible income-driven repayment options. After making payments for 20 to 25 years, any remaining student loan debt would be forgiven.
The drawback to pursuing this type of loan forgiveness is this. There are potential tax implications when your loans are forgiven. Since forgiven loans through IDR is considered taxable income, you might face a hefty tax liability. As such, do your research well. Weigh the pros and cons before making any decisions.
State-based Loan Repayment Programs
This is another teacher loan forgiveness program alternative option. Certain individual states have programs to help teachers pay off student loan debt. This is in addition to federal loan forgiveness programs.
Programs vary from state to state. For example, let’s look at two available state-based programs: Illinois Teachers Loan Repayment Program. And Tennessee Math & Science Teacher Loan Forgiveness Program
The Illinois Teachers Loan Repayment Program works like this. It allows teachers working in-state to receive up to $5,000. That is if they already received funds through the federal loan forgiveness program. However, teachers have to fulfill their five-year teaching obligation. This should be in an Illinois elementary or secondary school. The school should be designated as a low-income school.
Are you a teacher teaching at a Tennessee public school? Are you pursuing an advanced degree in math or science? Or, do you have a certification to teach math or science? If yes, the note. You could be eligible for loan forgiveness through the Tennessee Math & Science Teacher Loan Forgiveness Program.
For each year you receive loan funding, you must be employed in a Tennessee public school system two (2) years.