Teacher Student Loan Forgiveness
As part of the federal government’s commitment to educational initiatives, there are now programs available for those who choose to become teachers that allow for the cancellation of federal student loans. There are two different loans that are eligible for cancellation, the Federal Stafford Loan and the Federal Perkins Loan. Each of these programs is eligible for a different percentage of cancellation based upon specific eligibility requirements.
According to the cancellation program, a teacher is a person who offers instruction in a traditional or non-traditional setting. A teacher, according to this definition does not need a teaching certificate or a teaching degree. They simply need to be employed as a professional in a position that provides instruction.
In addition to meeting the definition of a teacher, the individual seeking cancellation must work in that capacity for the equivalent of one academic year. This means that they can work full-time at one district for an entire year, or they can work half-time at two districts for a year. Other specific arrangements may also be considered.
The teaching position qualifies for loan cancellation if it is in a low-income school district, as defined by the U.S. Department of Education. And, teachers of special needs children (including infants, toddlers and preschoolers) are also eligible for loan cancellation.
The Department of Education also maintains a list of school districts, and the areas in which they are lacking qualified teachers. Anyone who teaches in a district on the list, in an area of instruction that is also on the list will qualify for cancellation.
The Federal Perkins Loan is eligible for complete cancellation once the teacher meets all of the requirements listed above. The Federal Stafford Loan is eligible for partial cancellation, also dependent on the same requirements.
Something that many teachers do not realize is that while they are completing the required service for cancellation, they are most likely also eligible for the specific deferment and forbearance options offered by their specific loans programs and lenders. This can be quite beneficial, particularly for those teaching in low-income districts, which will generally offer salaries that are far below market rate for educators.
If you believe that you might be eligible for loan cancellation, the first step is to research the requirements of your specific loan programs. Next, you should be in touch with your lender – to let them know that you are planning to seek cancellation as a result of your teaching service. They will be a good resource and help to point you in the right direction in terms of your specific situation.