What Are the Requirements of a Loan Forgiveness of Teachers With Student Loans?
- The Teacher Loan Forgiveness Program forgives unsubsidized, subsidized and in some cases, consolidated Stafford Loans made through the Federal Family Education Loan or Direct Loan programs. To be eligible, you must have been a new borrower of an FFEL or Direct Loan on or after October 1, 1998. Also, you must not be in default on the loan or have received benefits from the AmeriCorp Program for the loan that you're seeking forgiveness for. The federal Perkins Loan cancellation program has less strict requirements regarding loans that can be canceled, but generally include any Perkins Loans made on or after July 1, 1972.
- Generally, the Perkins and Stafford Loan forgiveness programs both have similar requirements concerning which schools qualify for loan forgiveness. For example, both programs require you to teach at an elementary or secondary low-income school where at least 30 percent of the student population is low-income. Teaching in a private school qualifies only if it is a nonprofit. The Perkins Loan forgiveness program makes exceptions to the low-income rule if you're teaching in a specific subject area or are a special education teacher. You can find a list of schools that qualify for either loan forgiveness program in the Department of Education's online Teacher Cancellation Low Income Directory.
- With the Stafford loan forgiveness program, you can either have a total of $5,000 or $17,500 of your loans forgiven. You can qualify for the $5,000 amount if you meet the definition of a "highly qualified" teacher under the No Child Left Behind Act of 2001 and your teaching service began on or after October 30, 2004. If your teaching service began before that date and you're teaching in an elementary school, you must be certified by the school district as having knowledge and teaching skills in reading, writing and math. If teaching in a secondary school, you must have been teaching in a subject area related to your academic major. To qualify for the $17,500 forgiveness amount, you must be a "highly qualified" math or science teacher in a secondary school or a "highly qualified" special education teacher, teaching students with disabilities.
- The Perkins Loan cancellation program has few requirements as to the certification status of teachers and primarily stipulates that your employing school must consider you as a full-time professional. You can even be a school librarian or guidance counselor. You can qualify for loan cancellation based on one of three general criterion. First, you qualify if you're teaching in a low-income school. Second, you can qualify if you're a special education teacher and teaching handicapped or learning disabled students. Third, you qualify if you're a teacher in the field of math, science, foreign languages, bilingual education or in a subject that's been designated as a teacher shortage area by your state education agency.
- To receive the full benefit under either the Perkins or Stafford Loan forgiveness programs, you must have five complete, qualified teaching years. The Stafford Loan forgiveness program requires these years to be consecutive and you receive the benefit after you complete the five years of teaching service. For Perkins Loan cancellations, you receive cancellation benefits incrementally. Fifteen percent of your Perkins Loan gets canceled after each of your first and second years of teaching service; 20 percent after each third and fourth year; and 30 percent gets canceled after the fifth and any successive years.