Public University Student Loan Forgiveness: What's The Deal?

Student loan forgiveness is a pressing topic for many, and the Public Service Loan Forgiveness (PSLF) program is a valuable option for those seeking to have their federal student loans forgiven. PSLF is available to those who work in public service, including government, non-profit organizations, and certain academic professions. The program requires 120 qualifying payments over 10 years while working for a qualifying employer, and it applies only to federal direct loans. It's important to carefully navigate the requirements and eligibility criteria, and to be aware of potential scams offering loan forgiveness for a fee.

Public Service Loan Forgiveness (PSLF)

To be eligible for PSLF, borrowers must have the right type of loans. Only federal Direct Loans can be forgiven through PSLF. However, other federal student loans, such as Federal Family Education Loans (FFEL) or Perkins Loans, may be eligible if they are consolidated into a new federal Direct Consolidation Loan. It is important to keep proof of payments, as deferred payments prior to 2013 and extended periods of forbearance will be automatically counted as qualifying payments. Additionally, borrowers can request credit for shorter forbearance periods by filing a complaint with the FSA Ombudsman.

The PSLF Help Tool, provided by the U.S. Department of Education, can assist borrowers in determining their eligibility and next steps. This tool is free to use and can help borrowers document their qualifying employment and receive credit for their monthly payments. It is important to note that PSLF requires careful attention to detail and borrowers should regularly check their payment tally to ensure it matches their records.

Temporary changes to the PSLF program, which expired on October 31, 2022, made it easier for borrowers to receive forgiveness or get credit toward forgiveness. These changes included allowing borrowers to receive credit for past payments that were not on time or for less than the amount due. Borrowers who met the requirements were encouraged to apply for PSLF before the deadline.

Income-driven repayment forgiveness (IDR)

On April 19, 2022, the Department of Education (ED) announced several changes and updates to the IDR plans, including a one-time adjustment to count any month spent in repayment, some deferment and forbearance periods, and economic hardship or military deferments towards loan forgiveness. This adjustment will bring borrowers closer to forgiveness, and in some cases, loans may immediately qualify for forgiveness if they have been in repayment for more than 20 or 25 years.

The IDR account adjustment will result in loan discharges for borrowers who have made 20 or 25 years of payments, as well as for those who have submitted a Public Service Loan Forgiveness (PSLF) application and reach 120 payments due to changes in deferment qualifications. As of May 15, 2024, the IDR account adjustment has qualified over 996,000 borrowers for approximately $49.2 billion in student loan forgiveness.

It's important to note that only federal student loans managed by the Department of Education (ED) qualify for the one-time IDR adjustment. Borrowers with Direct Loans or federally-managed FFELP loans will automatically benefit from this adjustment, while those with FFELP loans held by commercial lenders or Perkins loans not held by ED must consolidate their loans by June 30, 2024, to be eligible.

The IDR account adjustment is meant to address past issues with the IDR and PSLF programs, including loan servicers miscounting payments and placing borrowers into unnecessary forbearances. As a result of these errors, forgiveness through older IDR plans has been challenging, with only a small number of borrowers achieving debt forgiveness despite years of payments.

Borrowers can estimate their eligibility for the IDR account adjustment by logging into their Federal Student Aid account and reviewing their loan types and repayment history. The Education Department will notify borrowers via email if they qualify for loan forgiveness, and they will have the option to opt out.

Loan forgiveness for college professors

Overview

The cost of obtaining the degrees needed to become a professor can be significant, and many professors carry substantial student debt as a result. While a career in academia may offer a decent income, the reality is that many positions are only part-time. This can make it challenging for professors to repay their student loans. However, there are several loan forgiveness programs and repayment strategies that professors can explore to manage their student debt.

Public Service Loan Forgiveness (PSLF)

The Public Service Loan Forgiveness (PSLF) program is a popular option for professors seeking loan forgiveness. PSLF is designed for public employees or non-profit workers and offers up to 10 years of loan forgiveness. To qualify for PSLF, professors must work full-time (at least 30 hours per week) at an eligible institution, which includes public colleges and universities, private non-profit colleges, and tribal colleges. Professors must also have federal Direct Loans and be on an income-driven repayment plan. After making 120 qualifying monthly payments while working for eligible employers, professors can apply for forgiveness, and the remaining balance of their federal student loans will be forgiven tax-free.

Faculty Loan Repayment Program (FLRP)

The Faculty Loan Repayment Program (FLRP), offered by the Health Resources & Service Administration (HRSA), is specifically aimed at college professors working at health profession schools or medical schools. This program offers up to $40,000 in debt repayment over two years of teaching. To qualify for FLRP, professors must demonstrate an economically or environmentally disadvantaged background, have a degree in a qualifying health profession, and commit to working for at least two years as a faculty member at an approved institution.

Income-Driven Repayment (IDR) Forgiveness

Income-Driven Repayment (IDR) forgiveness is another option for professors with federal student loans. Under IDR plans, professors make payments based on their income and family size, and the remaining loan balance is forgiven after 20 or 25 years of qualifying payments. Recent changes to IDR plans, such as the one-time adjustment announced by the Department of Education in April 2022, have made this option more attractive. These changes include counting certain periods of deferment and forbearance towards loan forgiveness.

Teacher Loan Forgiveness Program (TLF)

While the Teacher Loan Forgiveness (TLF) program is primarily designed for K-12 teachers in low-income public schools, it may also be an option for professors in certain circumstances. TLF offers up to $17,500 in forgiveness for highly qualified math, science, or special education teachers and up to $5,000 for other eligible teachers. However, TLF has exclusivity with PSLF, meaning professors cannot receive credit for both programs for the same period of teaching service.

Alternative Debt Management Options

In addition to loan forgiveness programs, professors can explore alternative strategies to manage their student debt, such as loan consolidation, refinancing, or more aggressive repayment plans. Refinancing federal loans may result in lower interest rates but comes with the trade-off of giving up protections such as loan forgiveness, income-driven repayment plans, and deferment. Professors can also consider increasing their income through side hustles or budgeting to allocate more funds towards loan repayment.

Adjunct professors and loan forgiveness

Adjunct professors can qualify for Public Service Loan Forgiveness (PSLF) if they work at least 30 hours per week on average. This can be achieved by working 30 hours at one institution or by combining hours from multiple eligible institutions. For example, adjuncts can teach a few classes at one school, one at another, and even one at a third. As long as each school is a government organisation like a state school or a non-profit entity like a private liberal arts college, they can get PSLF credit.

The U.S. Department of Education has implemented new guidelines for calculating teaching hours for adjunct faculty. Under these guidelines, employers must credit adjunct faculty with a minimum of 3.35 hours of work for every credit hour taught. For instance, a 3-credit course would count as at least 10.05 hours per week, and teaching 9 credits (typically 3 courses) would count as 30.15 hours, meeting the full-time requirement. Non-teaching duties such as course preparation, grading, office hours, and departmental meetings also count towards total hours.

To certify employment for PSLF, the PSLF form must be submitted annually or whenever the adjunct professor changes employers. If teaching at multiple institutions, separate forms for each eligible employer will need to be submitted.

The Biden administration has made changes to the PSLF program, expanding eligibility requirements and simplifying the process. The PSLF program forgives the remaining balance of federal student loans after 10 years of full-time work with a qualifying employer. Only federal Direct Loans qualify for PSLF. If an adjunct professor has FFEL Stafford or Federal Perkins loans, they can consolidate them into a Direct Consolidation Loan to make them eligible.

Adjunct professors should also be aware of potential scams. There are companies that may contact loan holders and offer to help them get loan discharge, forgiveness, cancellation, or debt relief for a fee. This is a scam. You never have to pay for help with your federal student aid. Only work with ED and your loan servicers, and never reveal your personal information or account password to anyone.

Teacher Loan Forgiveness (TLF)

The Teacher Loan Forgiveness program is one of the most beneficial forgiveness options for teachers. Teachers can qualify for a principal reduction of $5,000 to $17,500 on their loans, as well as full forgiveness after a 10-year term. Any remaining balance at the end of the 10 years is completely forgiven. The ten-year forgiveness is part of the Public Service Loan Forgiveness program, and teachers can often qualify for and receive benefits from both programs.

Eligibility Requirements for TLF

• Your Federal Student Loans (Direct Loan or Federal Family Education Loan) must have originated after October 1, 1998.
• If you are in default on a subsidized or unsubsidized loan, you are not eligible for forgiveness unless you have made satisfactory repayment arrangements with the loan holder.
• Loans for which forgiveness is sought must have been obtained before the end of the borrower's five years as a teacher.
• You must have completed five full academic years as a full-time teacher, and at least one of those years must have been after the 1997-1998 school year.
• You must have been employed in an elementary or secondary school that is a Title 1 school, qualifies for funds under the Elementary and Secondary Education Act of 1965, and has been determined by the Department of Education to have a total enrollment of children qualifying for services under Title 1. Alternatively, the school must be listed in the Annual Directory of Designated Low-Income Schools for Teacher Cancellation Benefits.
• Note that all elementary and secondary schools operated by the Bureau of Indian Education (BIE) or operated on Indian reservations by Indian tribal groups under contract with BIE qualify as schools serving low-income students. These schools are eligible for TLF even if they are not listed in the Annual Directory.
• If your school is eligible under the above conditions for one year but not the rest, that year may still be counted towards your five consecutive years of teaching.

Who is Considered a Teacher for TLF?

A teacher is defined as a person who provides direct classroom teaching or classroom-type teaching in a non-classroom setting. Special Education teachers are considered teachers.

You must be a teacher for five full and consecutive academic years after the 1997-1998 school year to qualify for the principal reduction in the Teacher Loan Forgiveness program.

Service Completed Before October 30, 2004

If your five consecutive years of teaching began before October 30, 2004, you may receive up to $5,000 in loan forgiveness if you were a full-time elementary school teacher in mathematics, reading, writing, or other areas of the school's curriculum, or a full-time secondary school teacher teaching in a subject related to your academic major.

You may receive up to $17,500 in loan forgiveness if you were a highly qualified full-time mathematics or science teacher in an eligible secondary school, or a highly qualified special education teacher whose primary responsibility was to provide special education to children with disabilities, and you taught children with disabilities that corresponded to your area of special education training.

Service Beginning on or After October 30, 2004

If your five consecutive years of teaching began after October 30, 2004, you may receive up to $5,000 in loan forgiveness if you were a highly qualified full-time elementary or secondary school teacher.

You may receive up to $17,500 in loan forgiveness if, as certified by the chief administrative officer of your school, you were a highly qualified full-time mathematics or science teacher in an eligible secondary school, or a highly qualified special education teacher whose primary responsibility was to provide special education to children with disabilities, and you taught children with disabilities that corresponded to your area of special education training.

If you are unable to complete an academic year, that year may still count towards your Teacher Loan Forgiveness if you meet one of the following conditions:

• Half of the academic year was completed.
• Your employer considers you to have completed your contract requirements for the purposes of salary increase, tenure, and retirement.
• You were unable to complete the academic year because you returned to college, on at least half-time credits, in an area directly related to your teaching position or to improve your performance in that position.
• You had a condition covered under the Family and Medical Leave Act of 1993 (FMLA).
• You were called into active duty in the Armed Forces for more than 30 days.

Am I a Highly Qualified Teacher Under TLF?

To be considered a highly qualified teacher, a public elementary or secondary school teacher must meet one of the following criteria:

• Have obtained full state certification as a teacher.
• Have passed the state teaching license examination and hold a license to teach in that state.
• Have not had certification or licensure requirements waived on an emergency, temporary, or provisional basis.

In addition, an elementary school teacher who is new to the profession must have at least a bachelor's degree and have demonstrated adequate teaching skills by passing state tests or having subject knowledge in core areas of elementary education. A middle or secondary school teacher who is new to the profession must hold at least a bachelor's degree and have demonstrated a high level of competence in each of the academic subjects they teach by either passing state tests or having subject knowledge in core areas of elementary education.

An elementary, middle, or secondary school teacher who is not new to the profession must hold at least a bachelor's degree, meet the applicable standards of an elementary, middle, or secondary school teacher who is new to the profession, and demonstrate competence in all the academic subjects they teach based on a high, objective, uniform state standard of evaluation set by the state. They must also align with challenging state academic content and student academic achievement standards, provide objective and coherent information about their attainment of core content knowledge, and meet several other criteria.

Frequently asked questions