On Oct. 6, 2021, the U.S. Department of Education (ED) announced a time-limited waiver opportunity to its PSLF program rules. Under the time- limited waiver opportunity, borrowers could receive credit for past payments which would not have been previously classified as qualifying payments or instances in which payments were not made, specifically, servicemembers who were advised to put their loans in a deferment or forbearance status and did not make payments while on active duty. The months the borrower spent on active duty can be counted toward the PSLF.
Borrowers will need to submit a PSLF form—the single application used for a review of employment certification, payment counts, and processing of forgiveness—on or before October 31, 2022 to have previously ineligible payments counted.
The time- limited waiver essentially waives all requirements except the employment requirement. If you have Federal Family Education Loans (FFEL) or Perkins loans, you will still be required to consolidate your loan with a Direct Consolidation Loan by Oct. 31, 2022. However, any payments made on your federal student loans, under any repayment plan (partial, full, or late), on any FFEL, Perkins, or Direct Loan, will count towards your 120 qualifying payments.
Under the new time-limited waiver, you need to have been employed or are currently employed by an eligible employer (government, 501(c)(3) not-for-profit, or other not-for-profit organization which qualifies), and working full-time. You can still qualify for the full-time requirement if you are working multiple part-time jobs (that totals at least 30 hours per week) with eligible employers. For more information on which employers meet PSLF Program requirements visit the PSLF Help Tool.
Choosing to teach is a noble decision, unfortunately many teachers are not paid in accordance with their service to society. The debt accumulated to become a teacher when compared to the expected salary upon graduation could be worrisome but should not deter anyone from pursuing this profession.
There are several programs that can help make student loan debt for teachers more manageable, if not reduced or eliminated entirely. These programs are primarily from the U.S. government and are meant for federal student loans but there are also options available for students with private student loans too.
Read on to learn how your passion to teach can be assisted by student loan forgiveness or other programs to help make your student loan debt more manageable.
Teacher Loan Forgiveness (TLF)
Overview: Forgives up to $17,500 of your Direct or FFEL Loans after 5 complete and consecutive academic years teaching at a qualified school or educational service agency
Eligible loans must have been made before the end of your five years of qualifying teaching service, and they include:
- Direct Unsubsidized Loans
- Direct Subsidized Loans
- FFEL Program Subsidized Loans
- Portions of a Direct or FFEL Consolidation Loan used to repay an eligible Unsubsidized or Subsidized Loans
Note: Direct PLUS Loans, FFEL PLUS Loans, and Federal Perkins Loans are not eligible for this forgiveness program.
Eligibility:
- You must be employed as a full-time, highly qualified teacher at an elementary school, secondary school, or educational service agency that service low-income students for five complete and consecutive years.
- At least 1 of those 5-years must be after the 1997-1998 academic year.
- You may be eligible to count a partial year as a complete year if you meet certain criteria
- There are certain requirements you must meet to be considered a “highly qualified teacher”. The basics include, having at least a bachelor’s degree, receiving a full state certification as a teacher, and not had certification or licensure requirements waiving on an emergency, temporary, or provisional basis. Other requirements also exist, especially for teachers who are new to the profession.
- AmeriCorps service cannot be counted toward your 5 years of teaching
- Apply AFTER you have completed your 5 complete academic years of teaching for loans made before the end of those 5 years.
- Your school or educational agency must be listed in the Teacher Cancellation Low Income (TCLI) Directory
For more information on Teacher Loan Forgiveness visit StudentAid.gov You must be a new borrower* as of Oct. 1, 1998.
Best For: Special Education, Mathematics and Science teachers
*New borrower as of Oct. 1, 1998 means, you must not have had an outstanding balance on a Direct Loan or FFEL Loan as of Oct. 1, 1998, or on the date you obtained a Direct Loan or FFEL Loan after Oct. 1, 1998.
Amount Forgiven: Up to either $5,000 or up to $17,500 on Direct of FFEL Subsidized and Unsubsidized loans.
Teachers eligible for $17,500, meet all the criteria and are:
- Highly qualified mathematics or science teacher who teach at the secondary level are eligible
- Highly qualified special education teachers, either at the elementary or secondary level who primarily provide special education to children with disabilities
All other teachers who are highly qualified elementary or secondary teachers who meet all the eligibility criteria (but not qualify for $17,500) are eligible for $5,000.
Public Service Loan Forgiveness (PSLF)
Overview: Forgives the balance of your Direct Loans AFTER 120 qualifying payments in an eligible repayment plan, while working full-time at an eligible employer. Public school teachers are likely eligible for PSLF. When it comes to private school teachers, it will depend if the teacher works for a 501(c)(3) nonprofit school. Some private schools, and many private colleges are considered a 501(c)(3) nonprofit institution, however you will need to check with your school. Amount Forgiven: The remaining balance of your eligible loans at the time of forgiveness.
- Eligibility:
Only Direct Loans are eligible for PSLF. Other loans such as FFEL and Perkins loans would not normally qualify, however with the Time-Limited PSLF Waiver mentioned above and a Direct Loan consolidation, you can apply for PSLF before October 31, 2022. That said, you can consolidate those loans into a Federal Direct student loan. If you choose to do this, please note, that you MUST consolidate before making the 120 qualifying payments. Payments made before the consolidation will not count towards the 120 needed. AND… - Work full-time (at least 30 hours) at an eligible employer. Eligible employers include federal, state, tribal governments, and 501(c)(3) not-for-profit employers. You can work with multiple eligible employers to qualify as full-time. AND….
- Make 120 qualifying monthly payments in a qualified repayment plan. Monthly on-time payments made on or after Oct. 1, 2007, under a 10-year Standard Repayment Plan, or Income-driven Repayment Plan (like income-based, income-contingent, etc.) will count as qualifying payments. You can’t solely use a 10-year Standard Repayment Plan, because you will have paid off the loan and have nothing to forgive.
- Parent PLUS Loan borrowers: Please note, these loans are not eligible for PSLF unless you consolidate them with a Direct Consolidation Loan and agree to repay the loan under an income-contingent repayment plan.
Details:
Most full-time public and private elementary and secondary school teachers will qualify. You must work for a not-for-profit organization, public schools and many private schools meet this qualification. The loan amount forgiven with the Public Student Loan Forgiveness program (PSLF) is not taxable.
Best For: All teachers planning to teach at a not-for-profit educational institution for at least 10 years.
Perkins Loan Federal Teacher Cancellation
Overview: Student Loan Forgiveness for up to 100% of your Federal Perkins Loan as long as you teach at a low-income school or teach qualifying subjects. To maximize the amount forgiven you will need to teach for at least 5-years within this program.*The Time-Limited PSLF Waiver program mentioned above would be a better choice if you consolidated into a Direct loan and apply before October 31, 2022.
Amount Forgiven: Up to 100% of your Federal Perkins loan only
Eligibility:
This program is ONLY for Federal Perkins Loans, for other federal loan consider the Teacher Loan Forgiveness or Public Service Loan Forgiveness programs
For those eligible, your loan could be forgiven (up to 100%) in the following increments (including accrued interest in the given year):
- 15% forgiven for your first and second years of service
- 20% forgiven for your third and fourth years of service
- 30% forgiven for your fifth year of service
If you aren’t teaching at a qualifying low-income school but you teach mathematics, science, foreign language, bilingual, special education, or a subject deemed to have a shortage in your state (check with state education agency to determine what these might be)
Private school teachers can qualify as long as the private school provides elementary and/or secondary education and has nonprofit status with the Internal Revenue Service (IRS).
Best For: Teachers with Federal Perkins Student Loans
Student Loan Forgiveness Programs by State
It’s not uncommon for states to provide their own student loan forgiveness programs for teachers. This is especially true for teachers who teach in high need areas. If any of the above programs are not the right fit for you, looking into student loan forgiveness at the state level might be the right approach. The American Federation of Teachers offers a database you peruse to see if there’s another program that is a better fit for you.
Combining Loan Forgiveness Programs
It might be tempting to apply for multiple programs if it turns out you qualify for more than one. You may not be able to do this and you need to make sure to strategize your plan appropriately.
When it comes to Teacher Loan Forgiveness and PSLF, you can’t double-dip for the same period of teaching service. Meaning, the five years you worked to qualify for Teacher Loan Forgiveness, any payments made to your loans will not count as a qualifying payment towards PSLF. Depending on your loan debt, you want to make sure you strategize that appropriately.
If you have a Federal Perkins Loan, you can qualify for Teacher Cancellation if you meet the criteria of that program, and still qualify for either Teacher Loan Forgiveness or PSLF on your other Direct Loans. If you have a Federal Perkins Loan, you might not want to consolidate it into a Federal Direct loan as that would eliminate the Perkins Loan Cancellation program for you.
Evaluate your options and decide what is the best course of action for you to maximize the amount of forgiveness you can receive.
Income Driven Repayment Plan Forgiveness
We recommended an income driven repayment plan if you are considering the Public Service Loan Forgiveness (PSLF) program. An income driven repayment plan is available for students with federal student loans and will base your monthly payment on a percentage of your income. However, if you are in income-driven repayment plan, and do not meet the qualifications for PSLF, you may still qualify for forgiveness. Depending on your income-driven repayment plan, after 20 or 25 years of payments (depending on your respective plan), you can qualify for student loan forgiveness of the remaining debt.
Even with a lower payment, many borrowers may not have a balance leftover after 20 or 25 years of payments to forgive. And if you are making lower payments and increasing your repayment term, it could cost you more money in interest. However, if you don’t qualify for any of the above programs but want some immediate relief for your federal student loans this might be an option for you.
Student Loan Refinance
For teachers with student loans that find they don’t qualify for any of the above programs for one reason or another, a Federal Direct Loan Consolidation to reduce the number of payments or a student loan refinance could be a way to reset your student loans. With a refinance you may be able to either lower your monthly payment or the interest being paid on your loan.
Student loan refinance as an option is great for students with private student loans taken to subsidize gaps in federal funding or for students with federal student loans looking to forego the benefits of federal student loans for a lower interest rate.
Whatever your reasons, student loan refinance is an excellent way lower your current interest rate (saving money over the length of the loan) or redefining your terms possibly extending the payments over a longer period of time in an effort to reduce the monthly payment to a more manageable one.
Private lenders offer the additional benefit of an interest rate reduction (typically between 0.25 – 0.5%) when enrolled in automatic debit payments.
Best Student Loan Refinance Lenders
College Ave Student Loans
- Variable rate range: 3.44% – 7.99% APR1
- Fixed rate range: 3.99% – 7.99% APR1
- No application or prepayment fees
- Apply in 3 minutes or less for instant credit decision
College Ave Student Loans products are made available through Firstrust Bank, member FDIC, First Citizens Community Bank, member FDIC, or M.Y. Safra Bank, FSB, member FDIC.. All loans are subject to individual approval and adherence to underwriting guidelines. Program restrictions, other terms, and conditions apply.
1The 0.25% auto-pay interest rate reduction applies as long as the borrower or cosigner, if applicable, enrolls in auto-pay and authorizes our loan servicer to automatically deduct your monthly payments from a valid bank account via Automated Clearing House (“ACH”). The rate reduction applies for as long as the monthly payment amount is successfully deducted from the designated bank account and is suspended during periods of forbearance and certain deferments. Variable rates may increase after consummation.
2This informational repayment example uses typical loan terms for a refi borrower who selects the Full Principal & Interest Repayment Option with a 10-year repayment term, has a $40,000 loan and a 5.5% Annual Percentage Rate (“APR”): 120 monthly payments of $434.11 while in the repayment period, for a total amount of payments of $52,092.61. Loans will never have a full principal and interest monthly payment of less than $50. Your actual rates and repayment terms may vary.
3$5,000 is the minimum requirement to refinance. The maximum loan amount is $250,000 for those with medical, dental, pharmacy or veterinary doctorate degrees, and $150,000 for all other undergraduate or graduate degrees.
Information advertised valid as of 8/11/2022. Variable interest rates may increase after consummation. Approved interest rate will depend on the creditworthiness of the applicant(s), lowest advertised rates only available to the most creditworthy applicants and require selection of full principal and interest payments with the shortest available loan term.
ELFI Student Loan Refinance
- Customers are saving an average of $309 every month and an average of $20,936 in total savings after refinancing their student loans with Education Loan Finance1
- Variable and fixed rates starting from 2.48% APR and 4.29% APR2
- Prequalify in as little as two minutes
- Award winning customer service from your dedicated Student Loan Advisor who is matched to you from the moment you sign up
1Average savings calculations are based on information provided by SouthEast Bank/ Education Loan Finance customers who refinanced their student loans between 8/16/2016 and 10/25/2018. While these amounts represent reported average amounts saved, actual amounts saved will vary depending upon a number of factors.
2Rates accurate as of 9/23/22. The interest rate and monthly payment for variable rate loans may increase after closing. Your actual interest rate may be different from the rates shown above and will be based on the term of your loan, your financial history, and other factors, including your cosigner’s (if any) financial history. For example, a 10 year loan with a fixed rate of 6% would have 120 payments of $11.00 per $1,000 borrowed. To qualify for refinancing or student loan consolidation through Education Loan Finance, you must have at least $10,000 in qualified student loan debt and must have earned a bachelor’s degree or higher from an approved post-secondary Education Loan Finance institution. Education Loan Finance Parent Loans are limited to a maximum of the 10-year term.
SoFi Student Loans
- Rates as low as 3.24% variable and 3.99% fixed1
- No fees or prepayment penalties
- Unemployment protection
1Fixed rates range from 3.99% APR to 8.24% APR with a 0.25% autopay discount. Variable rates from 3.24% APR to 8.24% APR with a 0.25% autopay discount. Unless required to be lower to comply with applicable law, Variable Interest rates on 5-, 7-, and 10-year terms are capped at 8.95% APR; 15- and 20-year terms are capped at 9.95% APR. Your actual rate will be within the range of rates listed above and will depend on the term you select, evaluation of your creditworthiness, income, presence of a co-signer and a variety of other factors. Lowest rates reserved for the most creditworthy borrowers. For the SoFi variable-rate product, the variable interest rate for a given month is derived by adding a margin to the 30-day average SOFR index, published two business days preceding such calendar month, rounded up to the nearest one hundredth of one percent (0.01% or 0.0001). APRs for variable-rate loans may increase after origination if the SOFR index increases. The SoFi 0.25% autopay interest rate reduction requires you to agree to make monthly principal and interest payments by an automatic monthly deduction from a savings or checking account. This benefit will discontinue and be lost for periods in which you do not pay by automatic deduction from a savings or checking account. The benefit lowers your interest rate but does not change the amount of your monthly payment. This benefit is suspended during periods of deferment and forbearance. Autopay is not required to receive a loan from SoFi.
Splash Financial Refinance Loan
- Rates as low as 2.49%1 Variable APR and 2.59%1 Fixed APR
- No pre-payment penalties, origination, or application fees
- See rates in 3 minutes without affecting your credit score2
1The rates displayed may include a 0.25% autopay discount.
2To check the rates and terms you qualify for, Splash Financial conducts a soft credit pull that will not affect your credit score. However, if you choose a product and continue your application, the lender will request your full credit report from one or more consumer reporting agencies, which is considered a hard credit pull and may affect your credit.
Earnest Student Loan Refinancing
- Variable rates starting at 2.49% APR (including 0.25% Auto Pay discount)*
- Fixed rates starting at 3.74% APR (including 0.25% Auto Pay discount)*
- Choose your own monthly payment
- No fees of any kind and exceptional customer service for the life of your loan
- Check your rate in under 2 minutes
To qualify, you must be a U.S. citizen or possess a 10-year (non-conditional) Permanent Resident Card, reside in a state Earnest lends in, and satisfy our minimum eligibility criteria. You may find more information on loan eligibility here: https://www.earnest.com/eligibility. Not all applicants will be approved for a loan, and not all applicants qualify for the lowest rate. Approval and interest rate depend on the review of a complete application.
Actual rate and available repayment terms will vary based on your income. Fixed rates range from 3.99% APR to 8.74% APR (excludes 0.25% Auto Pay discount). Variable rates range from 2.74% APR to 8.24% APR (excludes 0.25% Auto Pay discount). Earnest variable interest rate student loan refinance loans are based on a publicly available index, the 30-day Average Secured Overnight Financing Rate (SOFR) published by the Federal Reserve Bank of New York. The variable rate is based on the rate published on the 25th day, or the next business day, of the preceding calendar month, rounded to the nearest hundredth of a percent. The rate will not increase more than once per month. The maximum rate for your loan is 8.95% if your loan term is 10 years or less. For loan terms of more than 10 years to 15 years, the interest rate will never exceed 9.95%. For loan terms over 15 years, the interest rate will never exceed 11.95%. Please note, we are not able to offer variable rate loans in AK, IL, MN, NH, OH, TN, and TX. Our lowest rates are only available for our most credit qualified borrowers and contain our .25% auto pay discount from a checking or savings account.
*Auto Pay Discount: If you make monthly principal and interest payments by an automatic, monthly deduction from a savings or checking account, your rate will be reduced by one quarter of one percent (0.25%) for so long as you continue to make automatic, electronic monthly payments. This benefit is suspended during periods of deferment and forbearance. Not all borrowers will qualify for our lowest rates, and your rate will be based on creditworthiness at time of application.
The information provided on this page is updated as of 8/25/2022. Earnest reserves the right to change, pause, or terminate product offerings at any time without notice.
Earnest loans are originated by Earnest Operations LLC. California Finance Lender License 6054788. NMLS # 1204917. Earnest Operations LLC is located at 303 2nd Street, Suite 401N, San Francisco, CA 94107. Terms and Conditions apply. Visit https://www.earnest.com/terms-of-service, e-mail us at [email protected], or call 888-601-2801 for more information on our student loan refinance product.
