Teachers or students, who have taken a loan in order to pursue further education like a master’s degree through the Stafford Loan or the Plus Loan programs, may have some good news. There is a federally sponsored program for those individuals who may have some difficulty paying back their loan through a Teacher Loan Forgiveness Program. With this program an individual may actually be able to save as much as $17, 500 by getting it cancelled. In fact, any loan supervised by the Federal Family Education Loan Program(FFEL) as well as William D. Ford Federal Direct Loan Program may be eligible for the forgiveness program. However, the federal loan forgiveness program has its own criteria and you need to meet those criteria in order to qualify.
Qualification for the federal loan forgiveness program
The first thing you need to do is to apply for the forgiveness but in order to do that you need to complete at least five academic years of full time work in a low-income school which qualifies for funds from the government under Elementary and Secondary Education Act. If the school goes from low-income to high-income or if there is any other status change for the school while you are still working there, you will not have to compromise your eligibility for the loan forgiveness program. However, you must also remember that neither alternative private student loan nor the Perkins loan may be eligible for the forgiveness program.
With the kind of qualifications that you have you can get reimbursements at two different levels:
- Less than or up to $5000: For those of you who started to teach before October 30, 2004 in elementary school, teaching any one of the following – reading, mathematics, writing or any other curriculum in the school or you could be teaching in secondary school,teaching a subject that you may have majored in or may be related to your major you may qualify to receive $5000 as forgiveness. On the other hand, if you started to teach after October 30, 2004 you may still receive the loan forgiveness but you must be a very highly qualified teacher at the elementary or secondary school.
- Less than or up to $17, 500: This kind of loan forgiveness is available for those who are highly qualified as a teacher and teach science or mathematics. You can also qualify for loan forgiveness for up to $17, 500 if you teach at elementary or secondary school as a very qualified (with full-certification)special education teacher who works with disabled students attending your training for special education.
Things you must be aware of
You must remember that a portion of the loan that you take can be forgiven and not the entire loan. However, you must also remember that if you have been a defaulter on your student loan, you may not qualify for the forgiveness. Defaulters are not viewed in good terms when it comes to determining whether or not a portion of the credit should be forgiven. You must make arrangements for repayment with your lender in order to still qualify for the federal forgiveness program. The amount of money that you may have already paid will not be given back to you even when you apply for the forgiveness. Your loan will only be considered for the amount that may be remaining and based upon the eligibility criteria a portion of the balance will be forgiven.
Once you apply for the federal forgiveness program, you must have a certificate from the Chief Administrative Officer who may be the principal at your school, stating that you qualify for the program. Again, if it was more than one school that you taught in, then you need to get a certificate from each of these school administrators approving your eligibility. Once you complete five years of teaching you can start to apply for the forgiveness.
There are also other forgiveness programs that you may turn to if you in case you do not qualify for the federal forgiveness program or if your application gets cancelled. You could also seek help from the National Defense Education Act, which could also get your loan forgiven for a large amount.