Student loan forgiveness programs

The most common request to my blog regards student loan forgiveness programs. Given this constant interest, I am updating and summarizing the various loan forbearance programs.

Federal loan forgiveness is available for teachers, volunteers, law enforcement officials, nonprofit employees, and the military.

Teacher’s Student Loan Forgiveness

The Teacher Student Loan Forgiveness Program rewards teachers with a repayment between $5,000 and $17,500. After 5 years of service consecutively, teachers with an outstanding Direct Loan or FFEL balance as of October 1988 qualify for a $5,000 repayment of their student loans.

Teachers who pass on their love of math and science to students in eligible secondary schools with special education needs qualify for the full $17,500 forgiveness. The goal of this large repayment award is to encourage teachers to fill roles that are traditionally short staffed.

Learn more about the Teacher’s Student Loan Forgiveness program: here.

Student Loan Forgiveness Programs for Charitable Volunteers

When you spread kindness and goodwill, VISTA (Volunteers in Service to America), the Peace Corps, and Americorps, and return the favor by paying off a percentage of your student loan.

• VISTA rewards its volunteers with $4,725 after completing 1700 hours worth of service. VISTA’s mission is to eliminate hunger, illiteracy, poverty, and homelessness. Learn more by calling 1-800-942-2677.
• The Peace Corps rewards it volunteers in more ways than just good feelings. The Corps will repay 15% of a volunteer’s qualified student loans for each year of service until 70% of the starting balance is repaid. To discuss this opportunity further, contact the Peace Corp at 1-800-424-8580.
• Americorps is the branch of the Peace Corps that operates within the United States. Americorps rewards volunteers with $4,725 after 1 year of volunteer work. You can discuss this student loan forgiveness opportunity with an Americorps representative by calling 1-800-942-2677.

Head Start Staff Student Loan Forgiveness Program

Head Start was designed to help kids from low-income families gain the skills needed to enter kindergarten. Volunteers who help to make this goal a reality are rewarded by a generous student loan forgiveness plan. The state government will repay a borrower’s student loan at a rate of 15% per year until the loan is completely paid in full.

Nurses and Medical Technicians Student Loan Forgiveness Program

There are several student loan forgiveness programs targeted at medical professionals who work in regions or fields that traditionally lack quality medical professionals:

• The Nursing Education Loan Repayment Program (NELRP) will repay as much as 60 percent of the remaining student loan balance. This program is available for professionals who have worked for two years or more in critical shortage facilities. Eligibility details can be found: here.
• The National Health Services Corps awards qualified individuals with up to $35,000 in student loan repayment per year of service. See more details about this program: here.

Law Enforcement Officials Student Loan Forgiveness Program

When you protect and serve your community, the government will do your budget the same favor by paying down your Perkins student loan. Your loan will be cancelled if you serve full time as a qualifying law enforcement or corrections officer. To establish eligibility, the school must determine that your:

1. Employing agency is eligible; i.e., a local, state, or federal agency that is publicly funded and its activities pertain to crime prevention, control, or reduction or to the enforcement of the criminal law and
2. Position is essential to the agencies primary mission; i.e., you are a sworn officer or person whose principal responsibilities are unique to the criminal justice system.

Contact your school to find out how to confirm your eligibility and apply for this program.

Student Loan Forgiveness Program for Family Services or Non-Profit Child Agency Employees

This student loan forgiveness program will repay up to 100% of a borrower’s outstanding student loan for employees of eligible centers. The goal of this student loan forgiveness program is to attract and retain highly educated early childcare professionals.

In order to qualify, the borrower must have a bachelor’s degree in Early Childhood Education and work at a qualified facility. Qualified facilities are generally those where at least 70 percent of families that attend are earning less than 85 percent of the median household income.

Learn more about this student loan forgiveness program by calling the Child Care Provider Loan Forgiveness program at 1-888-562-7002 or visit: here.

Providers of Intervention Services for the Disabled Student Loan Forgiveness Program

Those who offer full time services to toddlers and infants with physical, emotional, social, adaptive, cognitive, or communicative needs disabilities qualify for a full repayment of their Perkins Loan. Care can be provided either in an in-home setting or at a facility as long as the program meets the guidelines issued by the Individuals with Disabilities Act. Your Perkins loan provider can give you more information about this student loan forgiveness program.

Armed Forces Student Loan Forgiveness Program

The military is known for its wide range of money-saving benefits and student loan forgiveness programs. The Armed Forces student loan forgiveness program will repay as much as $2,500 worth of student loans to borrowers who served between 9/11/01 and 6/30/06.

The National Guard also offers a student loan forgiveness program that will repay as much as $10,000 worth of student loans to each individual that qualifies. More information is available by calling 1-800-GO-GUARD.

How to Find More Student Loan Forgiveness Programs

There are literally hundreds of types of student loan forgiveness programs for various specialties. Start by contacting your company’s HR department and inquiring about little known programs for your industry. Contact local volunteer organizations in your community and ask about student loan forgiveness programs. Bookmark this page of student loan forgiveness references and pass it along to a friend. You could very easily save yourself or a friend a few thousand dollars!

For an excellent summary of federal student loan foregivness programs click here.

Source: ScholarPoint

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How about an ethic of service? A different take on physician student debt

A March 11, 2008 article in The Chronicle of Higher Education notes that the American Association of Medical Colleges and the American Medical Association have written a joint letter asking Congress to reverse the Department of Education’s decision to end a program that has allowed new physician graduates to lower student loans and defer interest on their student-loan payments.

The article states that “in 2007 the average medical student graduated with $140,000 in debt, and the average first-year resident earned less than $45,000, according to the letter. Eliminating the provision, the letter warns, could discourage students from pursuing less-lucrative careers in medical education, research, public health, or primary medicine.”

Give me a break. I borrowed $100,000 to earn a doctorate in healthcare administration (DBA-Healthcare) last September at the age of 57. I teach at a small college in Northern Virginia, with four international campuses, where I earn $50,000 in base salary. I’d like to believe that what I am doing is working with the future healthcare leaders in the U.S. and around the world.

And I am not alone. There are many occupations where students have assumed substantial debt to earn terminal degrees. I personally cannot support carte blanche treatment of physicians who have been and continue to be bulwarks against universal healthcare in the U.S. What an initiative like this does is continue the stereotype that physicians are somehow medieval lords deserving of subservience and special treatment.

Let’s get behind a federal student loan repayment initiative where payment extensions or loan forgiveness would be indexed to a service contract with America. Make loan repayment a function of the degree to which the student debtor is making a social contribution. For doctors, require free clinic work and uncompensated care, for teachers incentivize teaching in low to moderate-income communities, and for graduate MBAs link repayment to helping community-based nonprofits succeed.

Let’s replace the Neanderthal notion that physicians are “entitled” with one where physicians join equally skilled and indebted graduates who direct their time and talent to service to America.

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President signs federal student loan forgiveness bill

President Bush signed The College Cost Reduction and Access Act (H.R. 2669) into law on Sept. 27, 2007. The Act became effective on Oct. 1, 2007.

For us working for nonprofits and cause-relaed 501(c)(3) organizations, the impact of the Act is substantial, including forgiveness of all remaining federal student loans after 120, ontime payments (10 years). A detailed explanation of the public service loan forgiveness section of the bill can be found here.

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Federal student loan forgiveness for nonprofit employees

I teach Leadership and Change to working adults pursing graduate degrees in public administration and nonprofit management at George Mason University. They are a great group and one of the students shared the following information regarding the federal student loan debt forgiveness program for those who worked for nonprofits for ten years. You probably haven’t head about it, but you want to! The bill has just been reported out of committee and is headed to the White House. Let’s hope that the President will sign it.

This is the latest information on the forgiveness program.

H.R. 2669: The College Cost Reduction and Access Act – Courtesy of Maryland Nonprofits

On Friday Sept. 7, both houses of Congress approved a conference committee report including employees of 501(c)(3) organizations as ‘public sector’ employees for purposes of a new loan forgiveness provision. Among numerous other provisions (see below), the legislation defines employment by 501(c)(3) tax exempt organizations as a ‘public sector job’ making the individual eligible for loan balance forgiveness after 10 years of payments under an income contingent repayment plan.

Senator Barbara Mikulski was a member of the conference committee that accepted the House’s inclusion of 501(c)(3) employees, and Representative Sarbanes was a sponsor of the expanded loan forgiveness provision and inclusion of nonprofit employees, and Representative Van Hollen also co-sponsored the legislation.

In addition, Senator Cardin, and Representatives Gilchrest, Ruppersberger, Wynn, Hoyer and Cummings joined in voting for the conference report.

The nonprofit community across the country faces a serious challenge with the onset of “baby-boomer” retirements from its management and professional ranks. At the same time, costs of college and advanced education have skyrocketed, and many young people otherwise interested and committed to public service in nonprofit organizations are effectively forced to seek higher compensation elsewhere in order to repay college debt that rivals the cost of home-ownership just a decade or two ago.

At the same time, there is heightened concern among the public and in Congress itself with the effective and ethical operation of tax exempt organizations.

H.R. 2669 is described by the House Education and Labor Committee as “The largest investment in higher education since the GI Bill…”. In addition to loan forgiveness for public service, it includes:

• Interest rate reductions on subsidized student loans,
• Caps on required repayments based on available discretionary income,
• Increase in Pell Grant amounts and eligibility.

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