Teacher Loan Forgiveness

Public Service Loan Forgiveness

Also known as PSLF; The Public Service Loan Forgiveness Program is available to more than 30 million United States citizens. Although so many people may qualify, only a few will correctly apply and reap the benefits they are offered as public servants. This process could forgive thousands off the loan balance after the repayment term as well as lowering the monthly payments that are applied to the loan. Qualifications are based on the status of the employer, organization, or agency (not particularly on the work you do there).

Public Service Loan Forgiveness provides forgiveness of Federal Student Loans after 120 qualifying payments in a qualifying repayment structure, with no cap or limit on the amount of forgiveness that may be issued. This is an offer to individuals in repayment on their Federal Loans while working in Governmental Organizations (Federal State and Local), not for profit 501(c)(3), and not for profit public service recognized employers.

If the not for profit entity you work for is not 501(c)(3) tax-exempt, you may still qualify if the place of employment provides the following services…

            -Emergency Management

            -Early Childhood Education

            -Military Services

            -Public Health, Public Education, or Public Library Services

            -Public Interest Law Services

            -Public Safety and Law Enforcement Services

            -Public Service for the Disabled and Elderly

            -School Library and other Services

To benefit from the Public Service Loan Forgiveness Program one must:

-have Direct or Direct Consolidated Federal Student Loans

-make 120 qualifying (on time) payments

-enroll into an IDR for some portion of their 120 payments

-be employed full-time by a qualifying employer for the full 10 years or 120 payments

-annually complete and submit the employment certification form to their servicer

If you took out any Federal Loans that are not Direct Loans, you may consider the Direct Consolidation to get you loans in the correct format to qualify for these benefits. Direct Consolidating your loans will pay your existing loans in full and Issue you one new qualifying Direct Consolidated Loan.

Things to know:

There is currently no limit on the amount of forgiveness one can be awarded as long as the guidelines are followed in repayment.

This type of forgiveness is not considered taxable income, this is another huge benefit in qualifying for the PSLF program.

Full-time employment is a mandatory requirement with the qualifying employer. This means at least 30 hours worked per week or 30 combined hours per week if working for two qualifying employers on a part-time schedule.