Saturday, September 12, 2009, AM | 2 Comments
You are thinking “Did I choose a selfless career?” If you have, you might be in for a surprise – your student loan debt might be forgiven. Well! not so fast. It depends on what state you live in and what career field you have selected for yourself.
The most common type of loan comes from the Federal Family Education Loan Program (FFELP), followed by loans from the William D. Ford Federal Direct Loan Program that are eligible for forgiveness, with the two conditions, of course.
Here’s a run-down of the major types of loan forgiveness available and the corresponding professions. Check your individual state for more details:
The big news is that you can qualify for a freeze on interest accrual on loans made on or after Oct. 1, 2008. The benefit is available for up to five years of service, and is only for active-duty military serving “during war, mobilization or national emergency.” The catch with this one is that you have to have a Direct Loan in order to qualify.
Another new loan forgiveness perk for members of the military only covers those who have taken out Federal Perkins loans – need-based loans funded by the U.S. Department of Education and disbursed by individual colleges and universities. For those who have completed a year of service by this August, they can now qualify for 100% forgiveness of their Perkins loans after five years in uniform.
New for those going into teaching is that the loan forgiveness provisions for both FFELP and Federal Direct loans now extend to teachers who work part-time at more than one school district or work for educational service agencies.
The important thing to know is that the loan forgiveness only covers those working in public school systems that have been officially recognized as serving economically depressed areas.
- Most eligible teachers see $5,000 chopped off their student debt after five years in the classroom.
- For special-education teachers, or teachers instructing math or science at the high-school level, the forgiveness amount is much higher – $17,500 after five years.
- Teachers with Perkins loans are eligible for 100% forgiveness after five years.
Since 2007, the government has encouraged graduates to go into certain professions by offering to cancel the debt owed by workers in fields like emergency health, law enforcement, library administration, public day care and many more.
The condition is you need to be employed in public service and make all your monthly payments for 10 years before your remaining debt is forgiven. And, like other forgiveness options we’ve highlighted, this one is only for holders of Federal Direct loans.
In a Nutshell
Many students, when they graduate, are under heavy debt. The above are some professions that you can get into to get the student loan debt forgiven. If you have a passion for these disciplines to get into, then that’s for the better.
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