Your Guide to Student Loan Forgiveness for Teachers

 March 18, 2020
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Teaching is one of the most important professions in the world, but it’s at risk of losing top talent due to low pay and long hours. However, student loan forgiveness for teachers could help reverse that trend.

The average entry-level salary in the U.S. for elementary school teachers is $39,296, according to PayScale. Couple that salary with potentially high student loan debt and it’s clear that the figures don’t favor an easy period of paying back student loans.

Because it can be time consuming to sift through all the details of federal and state loan forgiveness programs for teachers, we’ve broken it down for you. Below are some options available that may help you dig yourself out of debt.

Teacher Loan Forgiveness

How much it’s worth: Up to $17,500 toward Direct or Stafford Loans.

Requirements:

  • Teach at a low-income school
  • Have no student loans originating before Oct. 1, 1998
  • Not be in default

How long it takes: Five complete and consecutive academic years.

The details: This one’s a little more complicated. The amount you can receive is based on your role. There are two tiers for Teacher Loan Forgiveness. You can receive up to $5,000 if you’re a full-time elementary teacher or full-time secondary school teacher. But you must be teaching in an area related to your academic major.

You can receive up to $17,500 if you’re a highly qualified full-time math or science teacher in an eligible secondary school. You can also receive this award if you’re a highly qualified special education teacher and if you meet certain requirements. To be considered “highly qualified,” you must obtain a full state certification as a teacher or pass the state teacher licensing exam. You must also hold a state license (with a few exceptions).

Certain exceptions are made if you’re a new elementary teacher who holds a bachelor’s degree and can meet other requirements. Visit the Federal Student Aid website for more information.

Public Service Loan Forgiveness

How much it’s worth: 100% of your Direct Loan balance after 10 years. This amount varies depending on many factors.

Requirements:

  • Must be in certain public sector jobs and employed full time
  • Must have made 120 payments starting from Oct. 1, 2007
  • Payments must be made as part of certain repayment plans
  • Not be in default

How long it takes: 120 qualified payments, which takes 10 years.

The details: This program isn’t just for teachers, although teachers can qualify. With this option, relief is more long term than the other programs we discuss above.

This plan typically works best with other types of qualifying repayment plans. For example, you may be able to take advantage of payment plans like Income-Based Repayment (IBR). IBR will lower your monthly payments and increase the amount of debt forgiven at the end of 10 years (if any).

However, if you miss any of the requirements, you may end up paying more in interest on your loans. To learn more about requirements, visit the Federal Student Aid website.

Federal Teacher Cancellation for Perkins Loans

The Federal Perkins Loan program expired in September 2017. However, if you borrowed money through the program before its expiration date, you might still qualify for Federal Teacher Cancellation for Perkins Loans.

How much it’s worth (assuming you have one pre-2017): Up to $27,500.

Requirements: You must teach for at least one year and meet one of the below requirements:

  • Teach at a low-income school (search the directory)
  • Teach special education
  • Teach in mathematics, science, foreign languages or bilingual education
  • Teach in a field that has a shortage of qualified teachers in your state

How long it takes: Minimum one full year of teaching, and 100% Perkins Loan debt cancellation after five years.

The details: After just one year of teaching, you can have 15% of your outstanding Perkins Loans canceled. This continues in varying amounts until you have all Perkins Loan debt canceled after five years. To apply, contact the school that holds your Perkins Loans. To learn more about requirements, check out the Federal Student Aid website.

State programs that offer student loan forgiveness for teachers

It’s worth investigating whether your state offers teacher student loan forgiveness programs. These plans vary based on where you live and teach, and all of them have specific requirements. Below is a list to get you started on your search.

Arkansas

Arkansas’ State Teacher Education Program provides up to $3,000 per year (or $4,000 per year for licensed minority teachers) to assist educators with repaying their federal student loans. Eligible individuals must teach in areas with a critical shortage or teach an in-demand subject.

Click here for more information about the Arkansas State Teacher Education Program.

Delaware

Under Delaware’s Teacher Corps initiative, teachers who live and work in Delaware might be eligible for loan forgiveness if they teach a critical need subject. With this program, for one year of teaching in a Delaware public school you can get forgiveness equal to one year of your loans.

Click here for more information about Delaware’s Teacher Corps Program.

Illinois

For teachers willing to work in low-income areas, the state of Illinois will award up to $5,000 to help individuals pay back their loan debt. To be eligible, teachers must have served five years in a low-income school.

Click here for more information about the Illinois Teachers Loan Repayment program.

Maine

Eligible borrowers can have one year of their loan forgiven for each year of eligible service. But the service must be as an educator, a speech pathologist or a child care provider. Certain borrowers, like teachers and speech pathologists, can have as many as two years of loans forgiven if they work in an underserved area.

Click here to learn more about Educators For Maine (EFM) Loan Program.

Maryland

If you’re a teacher (among other professions) in an underserved or low-income community in Maryland, you could receive up to $10,000 a year to repay your student loans through the Janet L. Hoffman Loan Assistance Repayment Program.

To qualify for aid, your annual gross salary cannot exceed $60,000 a year if you’re single, or $130,000 if you’re married.

Click here for more information about the Janet L. Hoffman Loan Assistance Repayment Program.

Mississippi

Teachers in Mississippi may receive up to $3,000 a year for a maximum of four years to pay their loans. Individuals must work in specific geographic areas or teach certain subjects to be eligible. There will be no awards made for the 2019-20 year, but applications are open for 2020-21 until March 31, 2020.

Click here for more information about the Mississippi Teacher Loan Repayment Program.

Montana

Through Quality Educator Loan Assistance, you could receive up to $3,000 at the end of your first year of teaching, then $4,000 at the end of the second year and $5,000 up until the third year to help you repay your loans. After the third year, state funding ends, but your school district could opt to offer you $5,000 at the end of your fourth year of teaching.

To qualify, you must be a full-time teacher working at an “impacted school” and in a subject that has been deemed a “critical quality educator shortage area.”

This program lost its funding in 2017 but returned in 2019. It is now operated out of the Office of Public Instruction. You can find more information about the Quality Educator Loan Assistance Program here.

New Mexico

If you teach in a designated high-risk position (bilingual education, special education and mathematics, among others) in a public school, you could receive aid through the Teacher Loan Repayment Program. Awards are dependent on the school’s needs for your position and your total amount of debt.

Click here for more information about the Teacher Loan Repayment Program.

New York

The New York State Education Department designed the Teachers of Tomorrow program to recruit and retain teachers in the schools with the largest need. Eligible teachers can receive up to $3,400 per year for four years.

Click here for more information about Teachers of Tomorrow.

Oklahoma

If you teach math or science in Oklahoma, you could be eligible for reimbursement for certain education-related expenses or a cash benefit. The value of the repayment assistance program varies year to year. Click here for more information about the Teacher Shortage Incentive Program.

Tennessee

Residents of Tennessee who teach math or science may be eligible for the Tennessee Math and Science Teacher Loan Forgiveness Program. This program offers $2,000 per academic year to math and science public school teachers and those seeking advanced teaching degrees in either subject. The amount cannot exceed $10,000. Click here for more information about the Tennessee Math and Science Teacher Loan Forgiveness Program.

Texas

The Texas Loan Repayment Assistance Program was designed to recruit and retain teachers in areas that have a shortage of educators. Eligible individuals can receive up to $2,500 towards their federal loans.

Click here for more information about the Texas Loan Repayment Assistance Program.

Virginia

Similar to a teachers loan forgiveness program, the Virginia Teaching Scholarship Loan Program (VTSLP) offers up to $10,000 per academic year to education students studying in the state of Virginia who commit to a teaching career in critical shortage teaching areas like special education and English as a Second Language (ESL).

These awards are contingent on teaching in Virginia schools for at least one year after graduation. Click here to learn more about the VTSLP scholarship.

More state programs

Keep in mind, state programs come and go more often than federal programs, so don’t delay if you’re eligible to apply. Even though managing student loans on a teacher’s salary can be overwhelming, there is help out there for educators.

For more information, see our longer list of student loan forgiveness programs and options that are designed to make repaying your debt a little easier.

Maya Dollarhide contributed to this report.

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1 Important Disclosures for Splash Financial.

Splash Financial Disclosures

Terms and Conditions apply. Splash reserves the right to modify or discontinue products and benefits at any time without notice. Rates and terms are also subject to change at any time without notice. Offers are subject to credit approval. To qualify, a borrower must be a U.S. citizen or permanent resident in an eligible state and meet applicable underwriting requirements. Not all borrowers receive the lowest rate. Lowest rates are reserved for the highest qualified borrowers. If approved, your actual rate will be within a range of rates and will depend on a variety of factors, including term of loan, a responsible financial history, income and other factors. Refinancing or consolidating private and federal student loans may not be the right decision for everyone. Federal loans carry special benefits not available for loans made through Splash Financial, for example, public service loan forgiveness and economic hardship programs, fee waivers and rebates on the principal, which may not be accessible to you after you refinance. The rates displayed may include a 0.25% autopay discount

The information you provide to us is an inquiry to determine whether we or our lenders can make a loan offer that meets your needs. If we or any of our lending partners has an available loan offer for you, you will be invited to submit a loan application to the lender for its review. We do not guarantee that you will receive any loan offers or that your loan application will be approved. Offers are subject to credit approval and are available only to U.S. citizens or permanent residents who meet applicable underwriting requirements. Not all borrowers will receive the lowest rates, which are available to the most qualified borrowers. Participating lenders, rates and terms are subject to change at any time without notice.

To 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.

Splash Financial and our lending partners reserve the right to modify or discontinue products and benefits at any time without notice. To qualify, a borrower must be a U.S. citizen and meet our lending partner’s underwriting requirements. Lowest rates are reserved for the highest qualified borrowers. This information is current as of May 4, 2022.


2 Rate range above includes optional 0.25% Auto Pay discount. Important Disclosures for Earnest.

Earnest Disclosures

Student Loan Refinance Interest Rate Disclosure Actual rate and available repayment terms will vary based on your income. Fixed rates range from 2.99% APR to 8.24% APR (excludes 0.25% Auto Pay discount). Variable rates range from 1.99% 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. Let us know if you have any questions and feel free to reach out directly to our team.


3 Important Disclosures for SoFi.

SoFi Disclosures

Fixed rates range from 3.49% APR to 7.99% APR with a 0.25% autopay discount. Variable rates from 1.74% APR to 7.99% 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.


4 Important Disclosures for Laurel Road.

Laurel Road Disclosures

All credit products are subject to credit approval.

Laurel Road began originating student loans in 2013 and has since helped thousands of professionals with undergraduate and postgraduate degrees consolidate and refinance more than $4 billion in federal and private school loans. Laurel Road also offers a suite of online graduate school loan products and personal loans that help simplify lending through customized technology and personalized service. In April 2019, Laurel Road was acquired by KeyBank, one of the nation’s largest bank-based financial services companies. Laurel Road is a brand of KeyBank National Association offering online lending products in all 50 U.S. states, Washington, D.C., and Puerto Rico. All loans are provided by KeyBank National Association, a nationally chartered bank. Member FDIC. For more information, visit www.laurelroad.com.

As used throughout these Terms & Conditions, the term “Lender” refers to KeyBank National Association and its affiliates, agents, guaranty insurers, investors, assigns, and successors in interest.

  1. Checking your rate with Laurel Road only requires a soft credit pull, which will not affect your credit score. To proceed with an application, a hard credit pull will be required, which may affect your credit score.
  2. Savings vary based on rate and term of your existing and refinanced loan(s). Refinancing to a longer term may lower your monthly payments, but may also increase the total interest paid over the life of the loan. Refinancing to a shorter term may increase your monthly payments, but may lower the total interest paid over the life of the loan. Review your loan documentation for total cost of your refinanced loan.
  3. After loan disbursement, if a borrower documents a qualifying economic hardship, we may agree in our discretion to allow for full or partial forbearance of payments for one or more 3-month time periods (not to exceed 12 months in the aggregate during the term of your loan), provided that we receive acceptable documentation (including updating documentation) of the nature and expected duration of the borrower’s economic hardship. During any period of forbearance interest will continue to accrue. At the end of the forbearance period, any unpaid accrued interest will be capitalized and be added to the remaining principle amount of the loan.
  4. Automatic Payment (“AutoPay”) Discount: if the borrower chooses to make monthly payments automatically from a bank account, the interest rate will decrease by 0.25% and will increase back if the borrower stops making (or we stop accepting) monthly payments automatically from the borrower’s bank account. The 0.25% AutoPay discount will not reduce the monthly payment; instead, the discount is applied to the principal to help pay the loan down faster.

Assumptions: Repayment examples above assume a loan amount of $10,000 with repayment beginning immediately following disbursement. Repayment examples do not include the 0.25% AutoPay Discount.

Annual Percentage Rate (“APR”): This term represents the actual cost of financing to the borrower over the life of the loan expressed as a yearly rate.

Interest Rate: A simple annual rate that is applied to an unpaid balance.

Variable Rates: The current index for variable rate loans is derived from the one-month London Interbank Offered Rate (“LIBOR”) and changes in the LIBOR index may cause your monthly payment to increase. Borrowers who take out a term of 5, 7, or 10 years will have a maximum interest rate of 9%, those who take out a 15 or 20-year variable loan will have a maximum interest rate of 10%.

KEYBANK NATIONAL ASSOCIATION RESERVES THE RIGHT TO MODIFY OR DISCONTINUE PRODUCTS AND BENEFITS AT ANY TIME WITHOUT NOTICE.

This information is current as of April 29, 2021. Information and rates are subject to change without notice.
 


5 Important Disclosures for Navient.

Navient Disclosures

You can choose between fixed and variable rates. Fixed interest rates are 2.99% – 8.24% APR (2.74% – 7.99% APR with Auto Pay discount). Starting variable interest rates are 1.99% APR to 8.24% APR (1.74% – 7.99% APR with Auto Pay discount). Variable rates are based on an index, the 30-day Average Secured Overnight Financing Rate (SOFR) plus a margin. Variable rates are reset monthly based on the fluctuation of the index. We do not currently offer variable rate loans in AK, CO, CT, HI, IL, KY, MA, MN, MS, NH, OH, OK, SC, TN, TX, and VA.


6 Important Disclosures for LendKey.

LendKey Disclosures

Refinancing via LendKey.com is only available for applicants with qualified private education loans from an eligible institution. Loans that were used for exam preparation classes, including, but not limited to, loans for LSAT, MCAT, GMAT, and GRE preparation, are not eligible for refinancing with a lender via LendKey.com. If you currently have any of these exam preparation loans, you should not include them in an application to refinance your student loans on this website. Applicants must be either U.S. citizens or Permanent Residents in an eligible state to qualify for a loan. Certain membership requirements (including the opening of a share account and any applicable association fees in connection with membership) may apply in the event that an applicant wishes to accept a loan offer from a credit union lender. Lenders participating on LendKey.com reserve the right to modify or discontinue the products, terms, and benefits offered on this website at any time without notice. LendKey Technologies, Inc. is not affiliated with, nor does it  endorse,  any educational institution.

Subject to floor rate and may require the automatic payments be made from a checking or savings account with the lender. The rate reduction will be removed and the rate will be increased by 0.25% upon any cancellation or failed collection attempt of the automatic payment and will be suspended during any period of deferment or forbearance. As a result, during the forbearance or suspension period, and/or if the automatic payment is canceled, any increase will take the form of higher payments. The lowest advertised variable APR is only available for loan terms of  5 years and is reserved for applicants with FICO scores of at least 810.

As of 5/17/2022 student loan refinancing rates range from 2.05% APR – 5.25% Variable APR with AutoPay and 2.49% APR – 7.93% Fixed APR with AutoPay.


7 Important Disclosures for PenFed.

PenFed Disclosures

Fixed Rate Loan Terms: 5 years/60 monthly payments, 8 years/96 monthly payments, 12 years/144 monthly payments or 15 years/180 monthly payments. Annual Percentage Rate is the cost of credit calculating the interest rate, loan amount, repayment term and the timing of payments. Fixed rates range from 3.29% to 5.43% APR. Rates are subject to change without notice. Fixed APR: Fixed rates will not change during the term. This rate is expressed as an APR. Since there are no fees associated with this loan offer, the APR is the same percentage as the actual interest rate of the loan. These rates are subject to additional terms and conditions, and rates are subject to change at any time without notice. Such changes will only apply to applications taken after the effective date of change.


8 Important Disclosures for CitizensBank.

CitizensBank Disclosures

Education Refinance Loan Rate Disclosure:  Variable interest rates range from 1.99%-8.38% (1.99%-8.38% APR). Fixed  interest rates range from 2.99%-8.63% (2.99%-8.63% APR).

IS Variable Rate Disclosure:  Variable Rates advertised are based on the one-month London Interbank  Offered Rate (“LIBOR”) published in The Wall Street Journal on the twenty-fifth day, or the next business  day, of the preceding calendar month. As of December 1, 2021, the one-month LIBOR rate is 0.09%.  Variable interest rates will fluctuate over the term of the loan with changes in the LIBOR rate, and will  vary based on applicable terms, level of degree and presence of a co-signer. Your final variable rate may  be based upon the 30-day average SOFR index, as published by the Federal Reserve Bank of New York.  The maximum variable rate is the greater of 21.00% or Prime Rate plus 9.00%.

ERL Variable Rate Disclosure: Variable interest rates are based on the 30-day average Secured Overnight Financing Rate (“SOFR”) index, as published by the Federal Reserve Bank of New York. As of May 1, 2022, the 30-day average SOFR index is 0.29%. Variable interest rates will fluctuate over the term of the loan with changes in the SOFR index, and will vary based on applicable terms, level of degree and presence of a co-signer. The maximum variable interest rate is the greater of 21.00% or the prime rate plus 9.00%.

Fixed Rate Disclosure: Fixed rate ranges are based on applicable terms, level of degree, and presence of a co-signer.

Lowest Rate Disclosure: Lowest rates are only available for the most creditworthy applicants, require a 5-year repayment term, immediate repayment, a graduate or medical degree (where applicable), and include our Loyalty and Automatic Payment discounts of 0.25 percentage points each, as outlined in the Loyalty Discount and Automatic Payment Discount disclosures. Rates are subject to additional terms and conditions, and are subject to change at any time without notice. Such changes will only apply to applications taken after the effective date of change.

Federal Loan vs. Private Loan Benefits:  Some federal student loans include unique benefits that the borrower may not receive with a private student loan, some of which we do not offer. Borrowers should carefully review federal benefits, especially if they work in public service, are in the military, are considering possible loan forgiveness options, are currently on or considering income based repayment options or are concerned about a steady source of future income and would want to lower their payments at some time in the future. When the borrower refinances, they waive any current and potential future benefits of their federal loans. For more information about federal student loan benefits and federal loan consolidation, visit http://studentaid.ed.gov/. We also have several resources available to help the borrower make a decision on our website including Should I Refinance My Student Loans? and our FAQs. Should I Refinance My Student Loans? includes a comparison of federal and private student loan benefits that we encourage the borrower to review.
 
Citizens Student Loan Eligibility: : Applicants must be enrolled at least half-time in a degree-granting program at an eligible institution.
 
Loyalty Discount Disclosure: The borrower will be eligible for a 0.25 percentage point interest rate reduction on their loan if the borrower or their co-signer (if applicable) has a qualifying account in existence with us at the time the borrower and their co-signer (if applicable) have submitted a completed application authorizing us to review their credit request for the loan. The following are qualifying accounts: any checking account, savings account, money market account, certificate of deposit, automobile loan, home equity loan, home equity line of credit, mortgage, credit card account, or other student loans owned by Citizens Bank, N.A. Please note, our checking and savings account options are only available in the following states: CT, DC, DE, FL, MA, MD, MI, NH, NJ, NY, OH, PA, RI, VA, and VT and some products may have an associated cost. This discount will be reflected in the interest rate disclosed in the Loan Approval Disclosure that will be provided to the borrower once the loan is approved. Limit of one Loyalty Discount per loan and discount will not be applied to prior loans. The Loyalty Discount will remain in effect for the life of the loan.
 
Automatic Payment Discount Disclosure:Borrowers will be eligible to receive a 0.25 percentage point interest rate reduction on their student loans owned by Citizens Bank, N.A. during such time as payments are required to be made and our loan servicer is authorized to automatically deduct payments each month from any bank account the borrower designates. Discount is not available when payments are not due, such as during forbearance. If our loan servicer is unable to successfully withdraw the automatic deductions from the designated account three or more times within any 12-month period, the borrower will no longer be eligible for this discount. Borrowers will be eligible to receive a 0.25 percentage point interest rate reduction on  their student loans owned by Citizens Bank, N.A. during such time as payments are required to be made and our loan  servicer is authorized to automatically deduct payments each month from any bank account the borrower designates. Discount is not available when payments are not due, such as during forbearance. If our loan servicer is unable to  successfully withdraw the automatic deductions from the designated account three or more times within any 12-month  period, the borrower will no longer be eligible for this discount.