Teacher Loan Forgiveness

Teacher Loan Forgiveness (TLF) is a separate federal program from PSLF. If you teach full-time for five complete and consecutive academic years at a low-income school or high-needs subject area, the program provides forgiveness up to $17,500 for Federal Direct Loans. 

Under PSLF’s requirements, your five years of employment used to receive Teacher Loan Forgiveness cannot be credited to PSLF, as you cannot simultaneously qualify for both programs due to the “double benefits” provision.

Teachers should seek help by going to the NEA Student Debt Navigator to determine which forgiveness program is right for them. Teacher Loan Forgiveness does not apply to education support professionals, specialized instructional support personnel, or higher education faculty.

Learn More About Teacher Loan Forgiveness

Income-Driven Repayment Plans

Income-driven repayment plans can help keep payments affordable (and be as little as $0 per month). Educators must be in one of these repayment plans to qualify for Public Service Loan Forgiveness.

• Monthly payments are determined by discretionary income, rather than loan balance. With an income-driven repayment plan, you will pay around 10-15 percent of your discretionary income. You can estimate your monthly payments using the Federal Student Aid Loan Simulator.
• Being enrolled in an income-driven repayment plan is the only way to qualify for Public Service Loan Forgiveness, which could forgive your student loans in as little as 10 years. Even if you don't qualify for Public Service Loan Forgiveness, when you participate in an income-driven repayment plan your balance is forgiven after 20 or 25 years.
• The less you make, the less you pay. Monthly payments can go down when you are facing financial hardship. Single applicants who make less than $19K or a family of four making less than $39K qualify for $0 monthly payments.

Currently, the four income-driven repayment plans, all of which are eligible for PSLF, are:

1. Revised Pay As You Earn Repayment (REPAYE)
2. Pay As You Earn (PAYE)
3. Income-Based Repayment (IBR)
4. Income-Contingent Repayment (ICR)

The Department of Education is proposing a new rule that would create a new income-driven repayment plan with much-improved terms:

• Requires borrowers to pay no more than 5% of their discretionary income monthly on undergraduate loans (opposed to 10% on existing plans).
• Redefines “discretionary income,” guaranteeing that no borrower earning less than 225% of the federal poverty level – equivalent to $15 minimum wage – will have to make a monthly payment.
• Forgives federal student loan balances after 10 years of payments (opposed to 20 years) for borrowers with original loan balances of $12,000 or less.
• Covers the borrower’s unpaid monthly interest, so a borrower’s loan balance will not increase provided they make their monthly payment, even when that monthly payment is $0 because their income is low.

We expect the new IDR plan to go into effect before the end of 2023. This will replace the current REPAYE plan.

Apply for an income-driven repayment plan

The Interest Payment Pause

In March 2020, as part of the CARES Act, Congress paused payments, interest, and collection efforts for most federal student loan borrowers. This payment pause officially ended on August 30, 2023, as required by the bill to raise the federal government’s debt ceiling. This happened in two stages:

• Interest accrual restarted on September 1, 2023
• Payments were due starting October 2023

The months during the payment pause count towards PSLF for Federal Direct Loans. For other loans, pursuant to account adjustment, those months will count if the loans were in a repayment status or in certain situations of deferment and forbearance. 

Now that the payment pause has resumed, educators must restart their federal student loan payments. Use our guide to ensure this shift goes as smoothly as possible.

Adjusting to Payment Resumption

The Fresh Start Program

With the Biden Administration’s help, every one of the approximately 7.5 million borrowers in default will be automatically free from collections, like wage garnishment, and have their default status removed from their credit report.

Borrowers in default that apply for the Fresh Start Program will get their loans out of default and can immediately enroll in an income-driven repayment plan to reduce their monthly payments and start working towards Public Service Loan Forgiveness.

Only certain loans are eligible for Fresh Start:

• Defaulted Direct Loan Program loans
• Defaulted Federal Family Education Loan (FEEL) Program Loans
• Defaulted Perkins Loans held by the Department of Education

If you’re not sure whether your loans qualify, you can call the Default Resolution Group at 1-800-621-3115 (TTY for the deaf or hard of hearing 1-877-825-9923).

Learn More About the Fresh Start Program