Are you a teacher struggling with student loan debt? Learn the differences between the Public Service Loan Forgiveness (PSLF) and Teachers Loan Forgiveness programs to see which one is right for you.
Pursuing a career in education is one of the noblest professions out there. Unfortunately, it's not always financially rewarding, and teachers often find themselves burdened with student loan debt. Luckily, there are two federal loan forgiveness programs available for teachers: Public Service Loan Forgiveness (PSLF) and Teachers Loan Forgiveness. In this article, we'll compare and contrast these programs to help you determine which one is right for you.
Approval Rates
According to a recent report by the U.S. Department of Education, only about 1% of applications for PSLF have been approved. As of September 2021, just over 7,200 people had received loan forgiveness under the program. This low approval rate can be attributed to several factors, including confusion about the eligibility requirements and complicated application process. However, it's important to note that changes have been made to the program to make it more accessible, such as allowing more types of loans to be eligible.
On the other hand, Teachers Loan Forgiveness has a much higher approval rate. According to the same report, over 31,000 people received loan forgiveness under the program in the 2019-2020 academic year. The average amount of loan forgiveness for elementary school teachers was $6,764, while secondary school teachers received an average of $7,925. Highly qualified math and science teachers could receive up to $17,500 in loan forgiveness.
It's worth noting that not all teachers may be eligible for Teachers Loan Forgiveness. In fact, only 26% of teachers who began their careers in 2007-2008 met the eligibility requirements for the program, according to a report by the Government Accountability Office. This is because the program only applies to teachers who have taught full-time for five complete and consecutive academic years in a low-income school or educational service agency.
Overall, the statistics show that while both PSLF and Teachers Loan Forgiveness are designed to help educators manage their student loan debt, they have different eligibility requirements, loan types, and amounts of loan forgiveness. It's important to carefully consider these factors before deciding which program is right for you.
PSLF and Teachers Loan Forgiveness:
PSLF and Teachers Loan Forgiveness are both loan forgiveness programs offered by the federal government, but they differ in several key areas. Here's what you need to know:
Eligibility:
To qualify for PSLF, you must work full-time for a qualifying employer, such as a government agency or non-profit organization, and have made 120 qualifying payments on your federal student loans. On the other hand, to be eligible for Teachers Loan Forgiveness, you must have taught full-time for five complete and consecutive academic years in a low-income school or educational service agency.
Amount of Loan Forgiveness:
Under PSLF, you may be eligible for complete loan forgiveness after making 120 qualifying payments. However, the amount of forgiveness you receive under Teachers Loan Forgiveness depends on the subject area you teach and the type of loan you have. For example, if you're a highly qualified math or science teacher, you could receive up to $17,500 in loan forgiveness.
Loan Types:
PSLF is available to borrowers with any type of federal student loan, including Direct Loans, FFEL Program loans, and Perkins Loans. However, Teachers Loan Forgiveness only applies to Direct Subsidized and Unsubsidized Loans, as well as Subsidized and Unsubsidized Federal Stafford Loans.
Application Process:
To apply for PSLF, you'll need to submit an Employment Certification Form annually and apply for loan forgiveness once you've made 120 qualifying payments. Teachers Loan Forgiveness, on the other hand, requires you to complete an application and submit it to your loan servicer after you've completed your five years of qualifying teaching service.
PSLF FAQs
What is the PSLF program? The PSLF program is a federal program that provides loan forgiveness for individuals who work in certain public service jobs, including government and nonprofit positions.
Who is eligible for PSLF? To be eligible for PSLF, you must work full-time in a qualifying public service job for at least 10 years, and have made 120 qualifying payments on your federal student loans while working in that job.
What types of loans are eligible for PSLF? Direct Loans, including Direct Consolidation Loans, are eligible for PSLF.
How much loan forgiveness can I receive under PSLF? You may be eligible to have the remaining balance of your Direct Loans forgiven after you have made 120 qualifying payments while working in a qualifying public service job.
Can I still receive loan forgiveness if I change jobs during the 10-year period? As long as you continue to work in a qualifying public service job, you can switch employers and still be eligible for PSLF. However, the 120 qualifying payments must be made while working in a qualifying public service job.
What types of jobs qualify for PSLF? A variety of public service jobs can qualify for PSLF, including government, military, and nonprofit positions. Your employer must be a qualifying public service organization to be eligible.
Can I receive loan forgiveness if I am in default on my loans? No, you must be current on your loan payments or have made satisfactory arrangements to repay your loans in order to be eligible for PSLF.
What happens if I am not eligible for PSLF after making 10 years of payments? If you are not eligible for PSLF after making 10 years of payments, you will not receive loan forgiveness under the program.
How do I apply for PSLF? To apply for PSLF, you will need to submit the PSLF application to the U.S. Department of Education's Federal Student Aid office. You will also need to provide documentation that proves you meet the eligibility requirements, such as proof of employment in a qualifying public service job.
Why have many PSLF applications been denied? Many PSLF applications have been denied due to confusion about the program's requirements and the complex application process. Some borrowers may also have been in ineligible repayment plans or not working in qualifying public service jobs for the required 10 years.
Teachers Loan Forgiveness FAQs:
What is the Teachers Loan Forgiveness program? The Teachers Loan Forgiveness program is a federal program that provides loan forgiveness of up to $17,500 for qualified teachers who work in low-income schools or educational service agencies.
Who is eligible for Teachers Loan Forgiveness? Teachers who work full-time for five complete and consecutive academic years in a low-income school or educational service agency are eligible for Teachers Loan Forgiveness. Additionally, they must have taken out their loans before the end of the five-year period.
What is considered a low-income school or educational service agency? A low-income school or educational service agency is defined as a school or agency that serves students from low-income families. This is typically determined by the percentage of students who receive free or reduced-price lunch.
What types of loans are eligible for Teachers Loan Forgiveness? Direct Subsidized Loans, Direct Unsubsidized Loans, Subsidized Federal Stafford Loans, and Unsubsidized Federal Stafford Loans are eligible for Teachers Loan Forgiveness.
How much loan forgiveness can I receive under the program? The amount of loan forgiveness you can receive depends on your teaching experience and subject area. Elementary school teachers can receive up to $5,000, while secondary school teachers can receive up to $17,500 if they teach math or science.
Can I receive loan forgiveness if I teach at a private school? Yes, teachers who work at private schools may be eligible for loan forgiveness under the program as long as the school meets the criteria for a low-income school or educational service agency.
Can I still receive loan forgiveness if I change schools during the five-year period? Yes, as long as you continue to work in a low-income school or educational service agency and complete the five-year requirement, you may be eligible for loan forgiveness.
Do I need to make payments on my loans while I am working toward loan forgiveness? You are still responsible for making payments on your loans while you are working toward loan forgiveness under the program.
Can I receive loan forgiveness if I am in default on my loans? No, you must be current on your loan payments or have made satisfactory arrangements to repay your loans in order to be eligible for Teachers Loan Forgiveness.
How do I apply for Teachers Loan Forgiveness? To apply for Teachers Loan Forgiveness, you will need to submit the Teacher Loan Forgiveness Application to your loan servicer. You will also need to provide documentation that proves you meet the eligibility requirements, such as proof of employment at a low-income school or educational service agency.
General FAQs
Q: Can I apply for both PSLF and Teachers Loan Forgiveness? A: Yes, you can apply for both programs, but you can't use the same period of qualifying service for both.
Q: Can I apply for PSLF if I work for a private school? A: No, only public service employers are eligible for PSLF.
Q: Can I still qualify for Teachers Loan Forgiveness if I teach at a school that's not considered low-income? A: No, you must teach at a low-income school or educational service agency to be eligible.
Conclusion:
If you're a teacher struggling with student loan debt, you're not alone. PSLF and Teachers Loan Forgiveness are two federal programs designed to help educators manage their debt. Understanding the differences between these programs can help you make an informed decision about which one is right for you. Remember to keep in mind the eligibility requirements, loan types, amount of loan forgiveness, and application process when making your decision to between PSLF and Teachers Loan Forgiveness.
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