What to know about the Teacher Loan Forgiveness program

Student loan debt can be overwhelming, especially for borrowers who aren’t in a high-paying field. If you’re a teacher with student loans, you may have loan forgiveness options, such as the Teacher Loan Forgiveness Program.  

If you’re considering refinancing your loans, you can use Credible to compare student loan refinance rates from various lenders in minutes.

What is the Teacher Loan Forgiveness program?

Teacher Loan Forgiveness is a federal program for full-time teachers who work in low-income schools or educational service agencies. It was created to encourage teachers to work in areas with a shortage of qualified teachers. To be eligible for the Teacher Loan Forgiveness program, you must have federal loans and be considered a highly qualified teacher by the U.S. Department of Education. 

What does it mean to be a ‘highly qualified’ teacher?

According to the U.S. Department of Education, you’re a highly qualified teacher if: 

• You hold at least a bachelor’s degree.
• You have full state certification as a teacher.
• You haven’t had any certifications or license requirements waived, revoked, or suspended for any reason.

Unfortunately, you won’t qualify for Teacher Loan Forgiveness if you’re a school administrator, counselor, librarian or other staff member in the education field. You must be a teacher working in a classroom setting for a qualifying employer. 

How much can be forgiven?

The Teacher Loan Forgiveness Program offers up to $17,500 in forgiveness for your Direct Subsidized and Unsubsidized Loans, as well as your subsidized and unsubsidized federal Stafford Loans. You may receive the full $17,500 if you’re a highly qualified special education teacher at the elementary school or secondary school level, or a highly qualified mathematics or science teacher at the secondary education level. 

You might be eligible for up to $5,000 in loan forgiveness if you work in a different subject area, as long as you meet the other requirements.

What are the eligibility requirements for Teacher Loan Forgiveness?

You may qualify for Teacher Loan Forgiveness if:

• You’ve been employed as a full-time teacher for five straight years. You must prove that you’ve taught full-time for a consecutive 5-year period. It’s important to note that one of those years must be after the 1997-98 academic year.
• You’ve worked in an eligible school or educational service agency. You must have taught at an elementary or secondary school, or a local educational agency, that serves low-income students.
• You have federal student loans. You have federal Direct Loans, federal Stafford Loans, or a Direct Consolidation Loan or federal Consolidation Loan.
• You’re a highly qualified teacher. You must meet the U.S. Department of Education’s criteria as a highly qualified teacher.
• You don’t have an outstanding balance on past loans. You must not have had an outstanding balance on either Direct Loans or Federal Family Education Loans (FFEL) as of Oct. 1, 1998, or on the date that you received a Direct Loan or FFEL Loan after Oct. 1, 1998. In addition, the loans you’re seeking forgiveness for must have been made before the end of your five years of qualifying teaching service.

What qualifies as a low-income school or educational service agency?

You can use the Teacher Cancellation Low Income (TCLI) Directory to determine whether your place of employment is considered a low-income school or educational service agency. 

You’ll need to click on the directory search and select the academic year and the state you live in. To narrow your search, you can also type in the name of your school or educational agency. 

If you find you’re not eligible for any teacher loan forgiveness options, you may want to think about refinancing your student loans.

How do you apply for Teacher Loan Forgiveness?

If you meet the requirements and would like to apply for Teacher Loan Forgiveness, follow these steps:

1. Fill out the Teacher Loan Forgiveness application. You can find the application on the Federal Student Aid website. You’ll need to provide your personal information as well as your employment details. You must also state whether you’ve applied for Teacher Loan Forgiveness in the past. Make sure your beginning and ending teaching dates include the month, date and year.
2. Contact your chief administrative officer. Reach out to the chief administrative officer (CAO) at your school or agency to complete the certification section of the form. This individual will likely have access to your education file and be able to confirm your employment. It might be your principal, assistant principal, superintendent or someone in human resources.
3. Send the form to your loan servicer. Once your application is complete, submit it to your loan servicer(s) at the end of your fifth year of teaching. Make sure you have a copy for your records before you send it.

Keep in mind that if you taught at different schools during the five-year period, the CAO from each school must complete the certification section. And if you have multiple loans with different loan servicers, you’ll need a separate form for each one. 

If you’re unsure of how many loans or servicers you have, check your Federal Student Aid account. Once you log in, you’ll be able to find all your student loans and loan servicers. 

Your loan servicer will determine how long it takes for your application to be processed. To avoid delays, make sure you’ve filled out your application accurately. Don’t forget to verify that your account has the right contact information, and continue to make your student loan payments to remain in good standing. 

Can teachers qualify for the Public Service Loan Forgiveness Program?

Public Service Loan Forgiveness (PSLF) is another option you may want to explore if you’re a teacher. It’s a loan forgiveness program for public service workers, including teachers. 

To qualify for Public Service Loan Forgiveness, you must be a qualified full-time employee at a government entity or not-for-profit organization. You must also have federal Direct Loans under an income-driven repayment plan. Once you’ve made 120 qualifying payments, you may qualify to have the remaining balance on your loans forgiven. FFEL and federal Perkins Loans are only eligible if you consolidate them into a Direct Consolidation Loan.

Can you receive both Teacher Loan Forgiveness and Public Service Loan Forgiveness?

You may be able to take advantage of both Teacher Loan Forgiveness and Public Service Loan Forgiveness. But you’ll need to have separate periods of teaching service to do so. For example, if you receive Teacher Loan Forgiveness after five years of teaching, you won’t be able to count any of those payments toward Public Service Loan Forgiveness. You must make 120 additional qualifying payments beyond that teaching period if you want to qualify for PSLF.

State student loan forgiveness programs for teachers

If you’re not eligible for federal student loan forgiveness, it’s a good idea to look into state loan forgiveness options for your profession. Available forgiveness programs and their eligibility requirements will depend on where you live. 

Alternative repayment options

If you’re unable to qualify for the Teacher Loan Forgiveness program, you may be able to refinance, sign up for an income-driven repayment plan, or even defer your payments. 

• Refinancing may lower your monthly payments, reduce your interest rate, or allow you to pay off your debt sooner. However, it’s best not to refinance your federal student loans, as you will lose access to government protections and benefits such as forbearance/deferment, income-driven repayment plans and student loan forgiveness programs.
• With an income-driven repayment plan, your payment usually ranges from 10% to 20% of your discretionary income. Once you’ve made 20 or 25 years of payments, your remaining balance is forgiven.
• With deferment, you might be able to postpone your payments temporarily, especially if you’re facing financial hardship. You’ll need to reach out to your lender to find out whether it’s an option and how it works.

You can compare student loan refinance rates quickly and easily with Credible.