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Teacher Loan Forgiveness and PSLF main differences

 ◙  June 26, 2020  |  Posted by:  |  Written by: Ella R.  |  Related: Easy Loan Application

Most teachers may find themselves eligible to participate in both types of loan forgiveness programs. However, there are ways to determine which one might be a better fit depending on the amount of the loan and the circumstances. The programs for student loan forgiveness are not all one-size-fits-all. There are multiple types of forgiveness programs which are available. Some of the more well-known forgiveness programs from the federal government are the Teacher Loan Forgiveness Program and the Public Service Loan Forgiveness Program.

Many borrowers looking to sign up for a loan forgiveness program get confused with each of these popular program's eligibility requirements. Both, however, typically forgive some or all of a teacher's student loans. This is where we see the similarities between the two end. The main objective is to repay the smallest amount over time. Because many teachers and educators find themselves eligible for both of these programs, it is essential that they take the time to find out which program is a better fit for them.

Below are the top differences to take into consideration between the TLF Program and the PSLF Program. These differences can help educators find the right program for their circumstances.

• Forgiveness Period - The PSLF program will forgive the rest of your loan balance once you have made 120 payments or have paid for no less than 10 consecutive years. This will be used on eligible loans while you are working full-time for either a non-profit employer or an eligible public service employer. Through the TLF program, the forgiveness time period is only five years. It should be noted that while you may apply for both of these programs, you are not able to do so for similar payment periods. Under the TLF Program, you will be able to apply for loan forgiveness after just five years. However, you will have to make additional payments for at least 10 years in order to apply for the PSLF Program.

• Amount Forgiven - As of now, there is not a cap for the loan amount which may be forgiven under the PSLF Program. The lack of a loan cap will allow nonprofit employees and public servants the ability to qualify to pursue other careers in fields that are in high need. The loan forgiveness can be used to help cover the lack of compensation that some of these fields give to their employees. This option helps employees who are not able to make full payments each month on their student loans. Overall, the best choice for a teacher would be to find the option that lets them pay the least amount.

• Employment Requirements - In order to be eligible for either of these loan forgiveness programs, you need to be an eligible teacher. Those who are working in other professions aside from teaching will not be eligible to apply for loan forgiveness with these programs. There are very specific requirements in order to be eligible for these programs. For educators who work at non-profit schools or public schools and meet the qualification requirements, they can apply for either of these programs.

• Consecutive Service - An added difference between these two programs has to do with the amount of consecutive service the applicant has. In order to apply for the TLF Program, a teacher needs to have been working at an eligible school for at least five consecutive years in a row. There are a few exceptions to this rule with regards to military deployment, however. The PSLF Program does not have a requirement for eligibility concerning consecutive years of qualifying service. If you make the switch between an eligible employer and a non-eligible employer, you won't lose credit for the qualifying payments you made while you were working for the eligible employer.

• Eligible Loans - Lastly, all teachers who are looking to receive loan forgiveness need to understand there are only certain types of loans which will be eligible. One program will allow you to apply with direct loans only. The other will allow you to apply with either a Federal Family Education Loan or a direct loan.

Before you pursue either loan forgiveness option, it is essential to acknowledge these main differences and confirm that you meet all requirements for eligibility before applying. Knowing the differences will help you to find the best option for your circumstances.


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