Programs forgive, cancel student loan debt
Published 8:38 am Monday, September 8, 2014
Sometime back I heard that if a person worked in education, for example, as a librarian or in high school, or as a firefighter or policeman for five years that his or her student loans could be forgiven. Could you please explain that?
Certainly.
Under the federal Teacher Loan Forgiveness Program, you can have part of your Stafford Loan balance forgiven if you teach full time for five years in a school that serves a low-income area.
Among the eligibility requirements, you must be a new borrower; the loan must have been granted before the end of the service time; and for at least one year of your service the school must be in a Title I district, have a proportion of Title I-eligible students that exceeds a third and be listed on the Annual Directory of Designated Low-Income Schools for Teacher Cancellation Benefits.
If your service began on or after Oct. 30, 2004, and you’re considered a “highly qualified” elementary or secondary school teacher — based on a mixture of certification and degree requirements — you may have up to $5,000 forgiven.
The forgiveness amount can be as high as $17,500, if you’re certified by your school’s chief administrative officer as being a highly qualified math or science teacher in a secondary school or a highly qualified special-education teacher.
The loan forgiveness program is open only to those who do classroom-type teaching. But a separate program — for Perkins Loan holders only — is open to both teachers and those who provide education services related to teaching, including librarians and guidance counselors.
To be eligible, you must work full time for a year in a public or nonprofit elementary or public school system that serves low-income families or be a special-education teacher or a teacher in math, science, foreign languages, bilingual instruction or a field that the state says lacks qualified teachers.
“Eligibility for teacher cancellation is based on the duties presented in an official position description, not on the position title. …” reads the Federal Student Aid website.
“You don’t need to be certified or licensed to receive cancellation benefits. However, your employing school must consider you to be a full-time professional for the purposes of salary, tenure, retirement benefits, etc.”
Under a third initiative, the Public Service Loan Forgiveness Program, you can have the balance of your Stafford, Ford, PLUS or direct consolidation loan forgiven if you make “120 qualifying payments” — one a month for 10 years — on the loan during your full-time work for a public service employer, including government agencies and some nonprofit groups.
“The type or nature of employment with the organization does not matter for PSLF purposes,” reads the Federal Student Aid site. “Additionally, the type of services that these public service organizations provide does not matter for PSLF purposes.”
Private nonprofit employers that lack tax-exempt status may qualify if they provide “emergency management, military service, public safety, or law enforcement services; public health services; public education or public library services; school library and other school-based services; public interest law services; early childhood education; public service for individuals with disabilities and the elderly.”
For more information, call 800-433-3243; the TTY number is 800-730-8913.
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Online: https://studentaid.ed.gov; www.consumerfinance.gov.
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The Informer answers questions from readers each Sunday, Monday and Wednesday. It is researched and written by Andrew Perzo, an American Press staff writer. To ask a question, call 494-4098 and leave voice mail, or email informer@americanpress.com.