Loan Forgiveness Programs

Are you teaching? Or working in public service? There are specific programs available that may allow loan forgiveness or cancellation of your federal student loans. Please read this information carefully. Some initiatives will be subject to federal funding or the forgiveness part applies out in the future, at the end of the 10-year repayment period.

Cancellation/Deferment Options for Teachers

If you're a teacher serving in a low-income or subject-matter shortage area, it might be possible for you to cancel or defer your student loans. Read further for information about:

• Canceling a Perkins Loan
• Stafford Loan Forgiveness for Teachers
• Stafford Loan Deferment/Forbearance Provisions
• Douglas Scholarship Reduced Service

Public Service Loan Forgiveness Program

Through the College Cost Reduction and Access Act of 2007, Congress created the Public Service Loan Forgiveness Program to encourage individuals to enter and continue to work full-time in public service jobs. Under this program, borrowers may qualify for forgiveness of the remaining balance due on their eligible federal student loans after they have made 120 payments on those loans under certain repayment plans while employed full time by certain public service employers. Since borrowers must make 120 monthly payments on their eligible federal student loans beginning after October 1, 2007 before they qualify for the loan forgiveness, the first cancellations of loan balances will not be granted until October 2017.

The borrower must be employed full time (in any position) by a public service organization, or must be serving in a full-time AmeriCorps or Peace Corps position. For purposes of the Public Service Loan Forgiveness Program, the term "public service organization" means --

• A federal, state, local, or Tribal government organization, agency, or entity (includes most public schools, colleges and universities);
• A public child or family service agency;
• A non-profit organization under section 501(c)(3) of the Internal Revenue Code that is exempt from taxation under section 501(a) of the Internal Revenue Code (includes most not-for-profit private schools, colleges, and universities);
• A Tribal college or university; or
• A private organization that is not a for-profit business, a labor union, a partisan political organization, or an organization engaged in religious activities (unless the qualifying activities are unrelated to religious instruction, worship services, or any form of proselytizing) and that provides the following public services --
• Emergency management;
• Military service;
• Public safety;
• Law enforcement;
• Public interest law services;
• Early childhood education (including licensed or regulated health care, Head Start, and state-funded pre-kindergarten);
• Public service for individuals with disabilities and the elderly;
• Public health (including nurses, nurse practioners, nurses in a clinical setting, and full-time professionals engaged in health care practioner occupations and health care support occupations);
• Public education;
• Public library services; and
• School library or other school-based services.

The measure also expands loan forgiveness to occupations in areas of high national need. Subject to annual appropriations, eligible borrowers could qualify for up to $10,000 in loan forgiveness over up to five years if they work in the following occupations:

1. Early childhood educators.
2. Nurses.
3. Foreign language specialists.
4. Librarians.
5. Certain highly qualified teachers.
6. Child welfare workers.
7. Speech-language pathologists and audiologists.
8. Public safety, emergency management, public health and public interest legal services workers.
9. Nutritional professionals.
10. Medical specialists.
11. Mental health professionals.
12. Dentists.
13. Those working in applied sciences, technology, engineering and mathematics.
14. Physical therapists.
15. Superintendents, principals and other school administrators.
16. Occupational therapists.
17. The measure also includes a loan repayment program for nonprofit legal services attorneys who agree to serve in those roles for at least three years.

For more information about Loan Forgiveness, visit the U.S. Department of Education website.