Student Loan Forgiveness for Teachers in 2021

Navigating student loans can be tricky, so we created the ultimate guide to student loan forgiveness for teachers to make it a lot easier for students in or entering the teaching profession. Here, you’ll find the four main forgiveness programs that teachers are eligible for, depending on their specific role. And if you’re just considering going into teaching, you’re going to be well prepared in guiding your teaching career along a path that ensures you’ll be timely and eligible for receiving help paying back your loans. Let’s get started.

What Is Loan Forgiveness?

Loan forgiveness means that the borrower (the person who took out the loan) is no longer required to repay all, or a portion of, the remaining principal and interest owed on the student loan.

Do Teachers Qualify for Student Loan Forgiveness?

Yes, absolutely. Whether you’re considering going into the teaching field or you’re already in the classroom, you know that the education requirements for teachers call for at least a few years in school.

Luckily, there are several options for federal student loan forgiveness for teachers to offset some of the debt, and some programs offer relief solely to teachers.

And considering that Americans collectively hold over $1.5 trillion in student loan debt as of 2018^†, there are a good number of loan forgiveness programs.

Which Teaching Careers Are Eligible?

The main requirement for eligibility for student loan forgiveness programs for teachers is that your job role must fit within Federal Student Aid’s definition of a teacher. What does that mean? The federal government describes a teacher as having the following responsibilities, depending on the forgiveness program. We’ll deep dive into each of these programs throughout this article to better understand what is required of you.

• Teacher Loan Forgiveness: A teacher is a person who provides direct classroom teaching, or classroom-type teaching in a non-classroom setting, including special education teachers.
• Federal Perkins Loan Cancellation: A teacher is someone who provides elementary or secondary school students with direct services directly related to classroom teaching, including school librarians or guidance counselors, for example. You must be considered full-time, though you do not need to be certified or licensed to receive cancellation benefits. Supervisors, administrators, researchers, and curriculum specialists are not considered teachers unless they primarily provide personal educational services directly to students.

Remember that there is no absolute guarantee of loan forgiveness, but there is a high likelihood of eligibility if you work in certain types of schools for a predetermined amount of time, depending on the loan forgiveness program. Each program has its own set of requirements in order to determine eligibility, so you’re already ahead of the game by doing your research beforehand.

Federal Student Loans Eligible for Forgiveness

Federal loans are one of the most accessible loans for students of any field. When it comes to student loan forgiveness for teachers, there are multiple types of loans available from the federal government. According to the Federal Student Aid Office of the U.S. Department of Education, currently, there are two loan programs. Let’s do a quick review of each type.

The William D. Ford Federal Direct Loan (Direct Loan) Program: This is the largest federal student loan program, in which the U.S. Department of Education is your lender. Under this program, there are four types of Direct Loans that are available.

• Direct Subsidized Loans are for eligible undergraduate students who demonstrate financial need to help cover the costs of higher education at a college or career school.
• Direct Unsubsidized Loans are for eligible undergraduate, graduate and professional students, however, students are not required to demonstrate financial need.
• Direct PLUS Loans are for graduate or professional students and parents of dependent undergraduate students to help pay for education expenses not covered by other financial aid.
• Direct Consolidation Loans allow you to combine all of your eligible federal student loans into a single loan with a single loan servicer.

The Federal Perkins Loan Program: This school-based loan program is for undergraduate and graduate students with exceptional financial need, and in which the school is lender.

The Federal Family Education Loan (FFEL) Program: This discontinued program arranged for loans to be made by banks or other financial institutions. No new FFEL Program loans have been made since July 1, 2010. Though this loan program no longer exists, FFEL loans are still eligible for forgiveness. Find more on forgiveness options below.

Federal Loan Repayment Options

Before seeking out a loan forgiveness program, you’ll need to decide how you want to pay back your loans first. Depending on your financial situation, there are several repayment plans available. Make sure to talk to your loan provider to discuss the details of each, and also make sure you have the appropriate repayment plan for the loan forgiveness program you want. These repayment options, as described by Federal Student Aid, are available for all students in and out of the teaching field.

Standard Repayment Plan: All borrowers have up to 10 years to repay their loans at a fixed amount each month. Eligible loans include:

• Direct Subsidized Loans
• Direct Unsubsidized Loans
• Subsidized Federal Stafford Loans
• Unsubsidized Federal Stafford Loans
• Direct Plus Loans
• FFEL Plus Loans

Graduated Repayment Plan: All borrowers have up to 10 years to repay their loans. Payments will start out low and increase every two years, but will not be more than three times greater than any other monthly payment. Eligible loans include:

• Direct Subsidized Loans
• Direct Unsubsidized Loans
• Subsidized Federal Stafford Loans
• Unsubsidized Federal Stafford Loans
• Direct Plus Loans
• FFEL Plus Loans

Extended Repayment Plan: To qualify, you must have more than $30,000 of Direct Loans or more than $30,000 of FFEL Program loans to repay. Borrowers have up to 25 years to repay with your choice of fixed or graduated payments. Eligible loans include:

• Direct Subsidized Loans
• Direct Unsubsidized Loans
• Subsidized Federal Stafford Loans
• Unsubsidized Federal Stafford Loans
• Direct Plus Loans
• FFEL Plus Loans

Revised Pay As You Earn Repayment (REPAYE) Plan: This is for Direct Loan Program borrowers. Monthly payments will be 10 percent of discretionary income, and, if you’re married, both parties’ loan debt will be considered. Eligible loans include:

• Direct Subsidized Loans
• Direct Unsubsidized Loans
• Direct Plus Loans made to students
• Direct Consolidation Loans that do not include PLUS loans (Direct or FFEL) made to parents

Pay As You Earn Repayment (PAYE) Plan: To qualify, you must be a Direct Loan Program borrower who 1) took out a loan on or after 10/1/2007, 2) has received a disbursement of a Direct Loan on or after 10/1/11 and 3) has a required payment amount that is initially under the 10-year Standard Repayment Plan. Your maximum monthly payments will be 10 percent of your discretionary income. Your spouse’s income or loan debt will be considered if you file a joint tax return. Also, you must have high debt relative to your income. Eligible loans include:

• Direct Subsidized Loans
• Direct Unsubsidized Loans
• Direct Plus Loans made to students
• Direct Consolidation Loans that do not include PLUS loans (Direct or FFEL) made to parents

Income-Based Repayment (IBR) Plan: This is for Direct Loan Program and FFEL Programs borrowers who have a required payment amount that is initially under the 10-year Standard Repayment Plan. Your monthly payments will be 10 or 15 percent of your discretionary income, and, if you’re married, your spouse’s income or loan debt will be considered if you file a joint tax return. You must also have high debt relative to your income. Eligible loans include:

• Direct Subsidized Loans
• Direct Unsubsidized Loans
• Subsidized Federal Stafford Loans
• Unsubsidized Federal Stafford Loans
• Direct or FFEL Plus Loans made to students
• Direct or FFEL Consolidation Loans that do not include PLUS loans made to parents

Income-Contingent Repayment (ICR) Plan: This plan is for Direct Loan Program borrowers. Your payments will be lesser of 1) 20 percent of your discretionary income or 2) the amount you would pay on a repayment plan with a fixed payment over 12 years that is adjusted to your income. Eligible loans include:

• Direct Subsidized Loans
• Direct Unsubsidized Loans
• Direct Plus Loans made to students
• Direct Consolidation Loans (including Direct Consolidation Loans made after 7/1/06 that repaid PLUS loans made to parents)

Federal Loan Forgiveness Programs

The federal government has created a number of options for students to eliminate a portion of their student loan debt if they qualify. All of the forgiveness options are dependent on time and making qualifying payments, so it’s important to know the facts ahead of time. Keep reading to find out if you qualify.

Repayment Plan Loan Forgiveness

Depending on the repayment plan you chose or were eligible for, there are student loan forgiveness options that are standard to the plans. The plans below are designed to forgive your outstanding balance after a certain amount of time, though you may have income tax on any amount that is forgiven.

Repayment plan	Years of qualifying payments before forgiveness
REPAYE	20 or 25 years
PAYE	20 years
IBR	20 or 25 years
ICR	25 years

The Public Service Loan Forgiveness (PSLF) Program

The Public Service Loan Forgiveness Program forgives the remaining balance on a public service employee’s Direct Loans after you have made 120 qualifying monthly payments. You must not default on your loans, and you must be using a qualifying repayment plan while working for a qualifying employer.

• A qualifying payment is made after 10/1/07, for the full amount due and no later than 15 days after the due date.
• A qualifying employer means that you work for:
  • Government organization at any level (federal, state, local, or tribal)
  • Not-for-profit organizations that are tax-exempt under Section 501(c)(3) of the Internal Revenue Code
  • Other types of not-for-profit organizations that are not tax-exempt under Section 501(c)(3) of the Internal Revenue Code, if their primary purpose is to provide certain types of qualifying public services
  • AmeriCorps or Peace Corps serving as a full-time volunteer

Loans under the FFEL Program or the Federal Perkins Loan Program do not qualify, since they are not Direct Loans, but they may become eligible if you consolidate them into a Direct Consolidation Loan. Any payments made on the FFEL Program or Perkins Loans before the consolidation do not count towards the 120 qualifying loan payments.

Note that because you must make 120 qualifying payments before you are eligible for loan forgiveness, it will be at least 10 years before you can apply for PSLF. If you want to apply, you must complete and submit the Employment Certification for Public Service Loan Forgiveness form (Employment Certification form) annually or when you change employers for the government to verify that you are making qualifying PSLF payments.

Send the completed form, with your employer’s certification, to FedLoan Servicing, the U.S. Department of Education’s federal loan servicer for the PSLF Program.

U.S. Department of Education
FedLoan Servicing
P.O. Box 69184
Harrisburg, PA 17106-9184

If you wish to fax it, fax it to 717-720-1628.

If FedLoan Servicing is already your servicer, you may upload your Employment Certification form on their website.

Federal Perkins Loan Cancellation

If you’re thinking about going into teaching and receiving a Federal Perkins Loan, it’s worthwhile to look into public or non-profit schools. Under the Perkins Loan Teacher Cancellation program, up to 100 percent of your loans can be cancelled if you serve full-time in a public or non-profit elementary or secondary school system as one of the following:

• A teacher serving students from low-income families
• A special education teacher, which includes teaching infants, toddlers, children or youth with disabilities
• A teacher of math, science, foreign languages or bilingual education, or in any other field of expertise determined by a state education agency to have a shortage of qualified teachers in the state

Basic Requirements for Perkins Loan Teacher Cancellation

It’s important to note that the cancellation of your Federal Perkins Loans is based on the duties of the official position description, not the position title, though you must be considered full-time by your employer. You must also be employed directly by the school system, but, if you teach in a post-secondary school, you are not eligible. You do not, however, need to be certified or licensed to receive cancellation benefits.

How Long Do I Need to Teach?

For every full academic year, or its equivalent, of full-time teaching service, you will be eligible to have a portion of your loan canceled. This does not mean there are a certain number of hours per day you must teach, as your full-time status is up to the discretion of your employer. Remember that an academic year takes into consideration school breaks, holidays and weather.

If you are teaching simultaneously at multiple schools part-time, you can still have your loans canceled as long as an official at one of the schools can certify that you taught full-time for a full academic year.

Here is a simple breakdown of how much of your loans can be canceled depending on the amount of time you have taught or performed another eligible instruction job role.

Years of Teaching	Amount Forgiven
Each of the first and second years	15% of the original principal amount
Each of the third and fourth years	20% of the original principal amount
The fifth year	30% of the original principal amount

More specifically, those in the following positions must perform eligible services for a pre-set amount of years for cancellation, according to the U.S. Department of Education’s Federal Student Aid Office.

• Teachers, as described above: Up to 100 percent for five years of service
• Full-time faculty at a tribal college of university, from 08/14/08 onwards: Up to 100 percent for five years of service
• Librarians with a master’s degree working in a Title-I elementary or secondary school, or in a public library serving Title I-eligible schools, from 08/14/08 onwards: Up to 100 percent for five years
• Full-time employees of a public or non-profit child- or family-service agency who provides services to high-risk children and families coming from low-income communities: Up to 100 percent for five years of service
• Full-time staff members of the Head Start education program: Up to 100 percent for seven years (at a rate of 15 percent per year for the first six years and 10 percent for the seventh) of service
• Full-time staff members in the education component of a pre-K or child care program that is licensed or regulated by the state, from 08/14/08 onwards: Up to 100 percent for seven years (at a rate of 15 percent per year for the first six years and 10 percent for the seventh) of service
• AmeriCorps VISTA or Peace Corps volunteer: Up to 70 percent for four years (at a rate of 15 percent for the first and second years and 20 percent for the third and fourth) of service

Where Can I Teach?

If you’re wondering if your place of employment counts within the public and non-profit education requirement, you should research if it meets the requirements below.

Private schools: The school must establish its non-profit status with the Internal Revenue Service (IRS), and it must provide elementary and/or secondary education according to state law.

Pre-school or Pre-K program: Your state must consider the program to be a part of its elementary education program. A low-income-school-directory designation that includes pre-K or kindergarten does not suffice.

Low-income schools: Cancellation will only be granted if the school is determined eligible by the state education agency. To be considered a “low-income school,” it must be in a school district that qualifies for federal Title I funds in the year you seek cancellation. In addition, more than 30 percent of the school’s enrollment must be of children in the Title I program. Note that if you’ve had a portion of your loan canceled for teaching in a low-income school for one year, you can continue to have portions of your loan canceled should the school no longer be listed as low-income in later years.

Education Service Agency: Your service will qualify if you’ve taught from 08/14/08 onwards.

Special Education: You are required to have an official public or non-profit elementary or secondary school certify that you are a full-time special education teacher working with infants, toddlers, children, or youth with disabilities on your cancellation form, or you must have an official letter from the school that bears its seal or letterhead. If you are registered by the appropriate state education agency, licensed, or certified, and your services are a part of the educational curriculum for handicapped children, you may qualify as a teacher if you provide one of the following services:

• Speech and language pathology and audiology
• Physical therapy
• Occupational therapy
• Psychological and counseling services
• Recreational therapy

Designated Subject Shortage Area: If you teach in one of these, you must teach full-time. Every year, states determine subject shortages in the elementary and secondary schools in each respective state. You can check with your local school system or state education agency to find out which subjects are considered in shortage. Should you teach science, math, foreign languages, or bilingual education, you automatically qualify for cancelation even if your state has not designated those as subject shortage areas. To be eligible, the majority of your classes must be taught in that respective field of expertise.

To apply, you’ll need to contact your loan servicer. If you’re not sure who your servicer is, you can use the My Federal Student Aid portal to find out.

Federal Teacher Loan Forgiveness

The federal government has designed an additional and teaching-specific loan forgiveness program known as the Teacher Loan Forgiveness Program. Under this program, you can receive up to $17,500 in forgiveness on your Direct Subsidized and Unsubsidized Loans and your Subsidized and Unsubsidized Federal Stafford Loans in exchange for five consecutive years of full-time teaching.

According to the Federal Student Aid Office, under Teacher Loan Forgiveness, “if you have a Direct Consolidation Loan or a Federal Consolidation Loan, you may be eligible for forgiveness of the outstanding portion of the consolidated loan that repaid an eligible Direct Subsidized Loan, Direct Unsubsidized Loan, Subsidized Federal Stafford Loan, or Unsubsidized Federal Stafford Loan.”

How Much Loan Forgiveness Can I Receive?

The maximum amount is $17,500 or $5,000, depending on the subject area you teach. If you have loans under the Direct Loan Program and the FFEL Program, a combined maximum of $17,500 + $5,000 may be granted for forgiveness for both programs.

To be eligible to receive up to $17,500, you must:

• Be a highly qualified full-time math or science teacher who has taught secondary school students; or
• Be a highly qualified special education teacher of elementary or secondary school students whose primary responsibility is providing special education instruction to students with disabilities that correspond to your area of special education training and demonstrate knowledge/skills in the content areas of the curriculum you teach.

Basic Requirements for Teacher Loan Forgiveness

These are the requirements for eligibility as laid out by the U.S. Department of Education:

• You may not have had an outstanding balance on Direct Loans or Federal Family Education Loan (FFEL) Programs as of 10/01/98, or on the date you obtained those loans (after 10/01/98)
• You must be a full-time, highly qualified teacher that has taught for five complete and consecutive years, and at least one of those years must be after the 1997-98 academic year
• You must have been employed at an elementary school, secondary school or educational service agency serving low-income students
• Your loans must have been made before the end of your five academic years of qualifying teaching service

Additional Requirements for Teachers

If you are new to teaching, you may have additional requirements you must fulfill in order to be eligible for student loan forgiveness for teachers.

Elementary school teachers: You must demonstrate subject knowledge and teaching skills in reading, writing, mathematics, and other areas of basic elementary education by passing a state test.

Middle of secondary school teachers: You must demonstrate a high level of competency in each of the subjects you teach by either:

• Passing a state academic subject test in each subject in which you wish to teach, or
• Completing an academic major, graduate degree, coursework equivalent to an undergraduate degree, or advanced certification or credentials in each of the academic subjects you want to teach.

If you are not new to teaching, you must also demonstrate competence in the subjects you wish to teach through a state standard of evaluation and meet the requirements placed upon those new to teaching, as outlined above.

How Do I Apply?

In order to apply for Teacher Loan Forgiveness through the federal government, fill out the application and give it to your loan servicer after completing the required five consecutive years of teaching.

Teacher Loan Forgiveness by State

Many states offer state-specific student loan forgiveness if you are a teacher, especially if you are teaching in low-income schools or subject shortage areas. While there are few, some cities also offer forgiveness programs. Check with your state’s education agency to see what your options are.

Other Conditions for Loan Cancellation or Discharge

There are several conditions whereby your student loans may be canceled or discharged for 100 percent of the amount of the loan, both Direct Loans and Federal Perkins Loans.

• Borrower’s total disability or death
• Bankruptcy (in rare cases)
• School closed
• False loan certification
• False certification through identity theft
• School does not make required return of loan funds to lender

Private Loans for Teachers

There is always an option to take out a private loan to pay for your teaching degree or certificate. If you’re interested in receiving a loan from a private lender, such as a bank, credit union or school, you can compare their options with federal loan options to see which options are right for you.

It’s important to know that private loans’ interest rate is variable and can often be quite high, while federal loans have a fixed interest rate. Make sure that you have a solid credit record, as that may be required to take out a private loan. You may also need a cosigner. The most vital thing to know is that it is unlikely that there will be any loan forgiveness programs available for private loans.

Start Your Teaching Journey

No matter where in the country you live, rural or city, teachers are a necessary and vital part of society. Having a career as a teacher is rewarding and respected, and it is one that requires a solid education and continuing investment. So, good for you for doing your research on maximizing your resources for financial aid and for considering your options in your career. The most important thing to remember is that you do have options and there are ways to lessen the debt of education. Once you’ve enrolled in your education program, be sure to check in with your school’s financial aid advisor for more information.