Student Loan Forgiveness Programs for Teachers: The Ultimate Guide

The Teacher Loan Forgiveness Program: How To Get Your Student Loans Forgiven as a Teacher

The Teacher Loan Forgiveness Program can help to eliminate up to $17,500 of your student loan debt, depending on your eligibility. 

The eligibility requirements include:

• Having a Federal Direct Loan or Stafford Loan (subsidized or unsubsidized) 

• Parent PLUS Loans, Graduate PLUS Loans, and Perkins Loans aren't eligible for this program

• Being considered a “highly qualified teacher,” which means you’ve attained at least a bachelor’s degree and are certified (or licensed) by your state

• Working full time for five complete, consecutive academic years

• Working in a qualifying low-income school or educational service agency

How Do You Prove You Are a Highly Qualified Teacher?

At its most basic, being a highly qualified teacher means you have at least a bachelor’s degree and are licensed to teach in your state. But there are some other requirements if you are an elementary or middle school teacher who is new to teaching.

What if I’m an Elementary School Teacher Who’s New to Teaching?

If you're new to the teaching profession and teaching elementary school, you will need to take a few extra steps to be eligible for TLFP. To be considered a highly qualified teacher as a new teacher, you must pass a state test demonstrating your skills in reading, writing, mathematics, and other areas of the basic elementary school curriculum. 

The state certification or licensing test that all teachers take might already meet this requirement. Your state may have a special test for elementary school teachers who already meet this requirement.

What if I’m a Middle School or Secondary School Teacher Who’s New to Teaching?

To be considered highly qualified as a new middle or high school teacher, you must either pass the state tests for each of the academic subjects you are/will be teaching, or complete:

• An academic major

• A graduate degree

• Coursework equivalent to an undergraduate academic major, or 

• An advanced certification or other credential for each of the academic subjects you teach

What if I’m Not New to Teaching? How Do I Prove I’m a Highly Qualified Teacher?

If you’re an experienced teacher, you must be able to demonstrate competence in all the academic subjects you teach. Your competence is based on your state's specific uniform standard of evaluation. 

This uniform state standard of evaluation may involve measures of teacher competence and also must:

• Be set by the state for grade-level appropriate academic subject matter, knowledge, and teaching skills  

• Be aligned with state academic content (and student academic achievement standards)

• Provide information about your content knowledge for the subject(s) you teach  

• Take into consideration the amount of time you've been teaching your specific subject(s)

What Does “Five Complete and Consecutive Years" Mean?

Another requirement for TLFP is to be a full-time teacher for five complete, consecutive years. At least one of those years must have been after the 1997–98 academic year for it to count toward TLFP eligibility. 

In special cases, an incomplete academic year may count toward the loan forgiveness program. If you completed at least half the academic year — and your school system considers you to have met your contract requirements for the academic year — your incomplete year could count as a “complete year” if any of the following are true:

• You returned to college on at least a half-time basis studying a field related to your teaching service

• You had a condition covered under the Family and Medical Leave Act of 1993

• You were called up to active duty for a period of more than 30 days as a member of the Armed Forces Reserves

How Is Low-Income School Defined?

The U.S. Department of Education's Federal Student Aid website provides more information about low-income schools, including the Teacher Cancellation Low-Income Directory (TCLI). You can check this directory to see if the school you are teaching at qualifies for this program.

How Much of My Debt Can Be Forgiven Through the Teacher Loan Forgiveness Program? 

The TLFP will forgive either $5,000 or $17,500 for qualifying applicants. These are two quite different amounts, so let’s look at who qualifies for which amount. Basically, your loan forgiveness amount is dependent on what subject you teach and/or if you are a special education teacher.

You are eligible for $17,500 in loan forgiveness if you:

• Are a highly qualified full-time math or science teacher who teaches at the secondary education level, or

• Are a qualified special education teacher in high school, middle school, or elementary school whose primary responsibility is to teach children with disabilities

If you don't fall into these subject areas, your maximum forgiveness under the Teacher Loan Forgiveness Program is $5,000.

Teacher Loan Forgiveness vs. Public Student Loan Forgiveness vs. Perkins Loan Cancellation

Some educators may not qualify for the TLFP. Others may choose not to participate in the TLFP because they want to pursue another forgiveness option like the Public Service Loan Forgiveness (PSLF) program. PSLF is the most well-known and popular federal program for loan forgiveness. Depending on your situation, it may be a better option than the Teacher Loan Forgiveness Program. 

It’s wise to research both options before deciding which path you want to pursue because the TLFP requires a five-year teaching commitment and the PSLF requires a 10-year commitment to public service. If you apply for TLFP, the five-year period does not count toward the 10-year PSLF requirement. In other words, you can’t utilize both programs concurrently.

For some educators, there’s also a third forgiveness option: Perkins Loan cancellation. However, to qualify for this program, you must have Perkins Loans, which are no longer made available.

The Public Service Loan Forgiveness Program

Many teachers qualify for both PSLF and TLFP. Public schools are usually qualified employers since they’re governmental organizations, and private schools that are 501(c)(3) nonprofits will also qualify for PSLF.

One of the advantages of PSLF over TLFP is that PSLF offers a full discharge of your loan balance after you make 120 qualifying monthly payments. Since you have to be enrolled in an income-driven repayment plan to qualify for PSLF, your monthly payments may be as low as $0. So if you have a lot of student loan debt, this may be a better option than TLFP, which only offers a maximum of $17,500 in debt forgiveness.

One downside to PSLF is that it takes longer than TLFP. To retain your eligibility for PSLF, you must work full time for a qualified employer during the 10-year repayment period. TLFP provides loan forgiveness after just five years.

It is important to note that only Direct Loans are eligible for Public Service Loan Forgiveness. Federal Family Education Loans (FFEL) and federal Perkins Loans do not qualify for the PSLF program unless they are consolidated and become a Direct Consolidation Loan. Only then can an FFEL program loan or a Perkins Loan qualify for PSLF.

What Is the Perkins Loan Cancellation and Discharge Program?

If you’re an educator with a federal Perkins Loan, the Perkins Loan Cancellation Program could be a great way to get up to 100% of your federal Perkins Loan discharged. To qualify, you must work full time in a public or nonprofit elementary or secondary school in a low-income area or school district. You must also teach in specific subject areas like math, science, or foreign languages. Special education teachers also qualify.

Note: If you consolidate a Perkins Loan into a federal Consolidation Loan, you lose your eligibility for the Perkins Loan Cancellation Program. 

How Educators Can Decide Which Forgiveness Program Is Best For Them

If you qualify for student loan forgiveness, it can be a motivating goal to work toward. But if you qualify for multiple programs, how do you decide which one to enroll in?

You’ll want to look at:

• The type(s) of loan(s) you have

• How much you owe

• What your monthly payment will be under an income-driven repayment plan

• The eligibility criteria and potential total loan forgiveness under any program you’re considering

If you don’t have a very high student loan balance and have only Stafford and/or Direct Loans, start by looking at the Teacher Loan Forgiveness Program. First, see which forgiveness amount you’ll qualify for… if you have $20,000 in student loans and qualify for $17,500 in forgiveness, that’s a pretty good rate of forgiveness! But if you only qualify for $5,000 in forgiveness, you’re only going to discharge about one-fourth of your total loan debt at the end of the five-year repayment period.

If you have a high loan balance and a Federal Direct Loan or Federal Stafford Loan, you may be better off with Public Service Loan Forgiveness. For purposes of comparison, a “high” loan balance here means more than $20,000 or so. This isn’t a judgment of your loan amount, though! The average borrower owes almost $40,000 in student loan debt, so you’re not alone.

Let’s run through a few hypothetical scenarios so you can get a sense of how to figure out which program is best for you.

Example 1: When TLFP Is a Better Option

Alex works in a low-income school as a highly qualified math teacher and has a $22,000 Direct Loan balance.

Under the Teacher Loan Forgiveness Program, Alex is eligible for $17,500 in loan relief. Let’s say Alex pays $150 on her student loans per month. Over five years, Alex will pay $9,000. Then, Alex’s remaining loan balance of $13,000 will be forgiven. 

By comparison, if Alex enrolls in PSLF and has the same monthly payment, she’d pay $18,000 over 10 years before the final $4,000 is forgiven.

You can probably see which is the better option for Alex! Though both programs will eventually reduce her loan balance to zero, she ends up paying a lot more under PSLF. 

Example 2: When PSLF Is a Better Option

Anthony is Alex’s colleague. He is also a highly qualified math teacher in the same low-income school. Anthony has a $50,000 Direct Loan balance, and he’s currently paying $100 per month on his loans.

If Anthony enrolls in TLFP, he’ll pay $6,000 over five years and then will qualify to have $17,500 of his remaining balance ($44,000) forgiven. That’s a big burden lifted, but Anthony will still owe $26,500. 

By contrast, if Anthony enrolls in PSLF, he’ll pay $12,000 over the required 10-year repayment period. Then he’ll be eligible to have the remaining $38,000 of his loan debt forgiven. In this case, PSLF is probably the best choice for Anthony.

Teacher Loan Forgiveness vs. Public Service Forgiveness: Other Considerations

Being an educator is hard work, so it’s no surprise that teaching has a high turnover rate. If you think you want to work as a teacher for a while then try something else, consider that when deciding which forgiveness program you decide to enroll in. Remember, you can still qualify for PSLF if you move out of the teaching profession so long as you work at a qualifying nonprofit or government agency. 

Of course, this can be difficult to predict! Do your best to choose the right program for you given your career aspirations, loan debt, and other goals.

I Don’t Qualify for Teacher Loan Forgiveness, and I Can’t Pay My Loan. Is There Help for Me?

Life is unpredictable. If teaching didn’t work out for you and/or you don’t qualify for loan forgiveness, you may be feeling overwhelmed with your loan debt. 

Here’s where to start: If you haven’t already, look into getting on an income-driven repayment plan. This ties your monthly student loan payments to your monthly income. The hope is that the result is affordable! But if it’s not or if you need a temporary reprieve, you can also look into applying for forbearance or deferment.

If you’ve already tried all this and still feel like you’re drowning in debt, it may be time to consider filing student loan bankruptcy. Bankruptcy is a legal tool designed to give those who need it a financial fresh start. If you meet the eligibility requirements, bankruptcy can be a great way to clear your student loan debt. 

If you’re feeling guilty, embarrassed, or ashamed about needing help, don’t! (After all, U.S. companies file bankruptcy all the time to deal with their debt.) There’s widespread agreement that the student loan issue has become a crisis in the U.S. And educators are often underpaid for their work, making it very difficult to get ahead financially.

If you want to explore bankruptcy as an option, Upsolve is here to help. Take our free, five-minute eligibility screener now to see if you’re a good candidate to file bankruptcy to clear your student loans. Upsolve has helped thousands of people erase over $600 million in debt and get a new lease on life … all for free.