Not only is the process of becoming a professor long, but it's also expensive. Even with scholarships, grants, and other financial aid, educators borrow significant student loan debt.
Thankfully, Congress, and in turn, the U.S. Department of Education, offers different forgiveness options, specifically for professors. If you work or teach in higher education, here's what you need to know about the student loan forgiveness programs and student loan repayment options available to you.
Student loan forgiveness for professors
Both professors and adjunct faculty have three main options for student loan forgiveness:
- The Public Service Loan Forgiveness Program
- Income-Driven Repayment Plan Forgiveness
- Faculty Loan Repayment Program (FLRP)
The PSLF and IDR forgiveness options are specifically for borrowers who have federal student loan debt. Borrowers with private student loans who work at a health professions school can get up to $40 thousand in debt relief.
1. Public Service Loan Forgiveness
Of all the loan forgiveness programs for professors, the Public Service Loan Forgiveness Program is the most powerful. Under the PSLF Program, the U.S. Department of Education offers higher education educators, professionals, and faculty members the chance to have their entire federal student loan balance forgiven.
Your school qualifies for the PSLF Program if:
- It's a government organization. State schools, community colleges, tribal institutions, public schools, etc., all qualify.
- It's a 501(c)(3) nonprofit. Many private, not-for-profit colleges are a 501(c)(3). Check with your school's HR Department to confirm the school's nonprofit status.
If you're interested in applying for PSLF, follow these steps:
- Confirm you have Direct Loans: you can check the type of federal student loans you have at studentaid.gov. Only Federal Direct Loans qualify for the PSLF Program. Federal Perkins Loans and Federal Family Education Loans (FFELP) are ineligible for the program. Also, there's no way to get retroactive credit for those loans. The only way you can PSLF forgiveness for FFEL and Perkins Loans is to consolidate them into a Direct Consolidation Loan.
- Enroll in an IDR Plan: you have to be in a qualifying repayment plan. All income-driven repayment plans (IBR, REPAYE, PAYE, etc.) are qualifying repayment plans. If you made monthly payments under a different plan (e.g., Standard Repayment Plan), you may be able to get credit for those payments under the Temporary Expanded Public Service Loan Forgiveness Program.
- Work full-time: you need to work at least 30 hours a week on average. Part-time employment can qualify if you work at two different schools that qualify for PSLF.
- Register for the PSLF Program: although not required, the best practice is to submit a PSLF Employment Certification Form each year when you submit your annual recertification for an income-driven repayment plan to your student loan servicer.
- Make 120 payments: you have to make 120 qualifying payments before meeting the eligibility requirements for forgiveness. Your payment qualifies if it is made within 15 days of the due date. Because of this rule, there's no way to meet the forgiveness criteria faster.
How are hours calculated for adjunct professors for student loan forgiveness? Adjunct faculty can qualify for the PSLF Program so long as they work an average of 30 hours per week at qualifying employers. You can combine hours from two or more colleges to satisfy the 30-hour requirement.
PSLF Limited Waiver Opportunity
On October 6, 2021, the Department of Education announced a change to PSLF program rules through October 31, 2022, as a result of the COVID-19 pandemic.
Now through Halloween 2022, you can receive credit towards PSLF and TEPSLF for past payments made on loans that otherwise might not qualify for PSLF.
Past payments may now count as qualifying payments. Loan type, repayment plan, full payments, and on-time payments are no longer barriers for PSLF. The only thing you now need is qualifying employment.
Learn More: PSLF Changes
2. Income-Driven Repayment Plan Forgiveness
While pursuing PSLF, professors can also work towards IDR loan forgiveness after 20/25 years. Each of the income-driven repayment plans will forgive your remaining loan balance after making 240 or 300 monthly payments.
Eligible repayment plans:
- Revised Pay As You Earn (REPAYE)
- Pay As You Earn (PAYE)
- Income-Based Repayment (IBR)
- Income-Contingent Repayment (ICR)
Graduate and doctoral students might be able to start earning credit towards this forgiveness program if they agree to make student loan payments rather than requesting a deferment or forbearance.
3. Faculty Loan Repayment Programs (FLRP)
Borrowers who work at an accredited health professions school or medical school may be eligible to get some of their federal or private student loans forgiven through the Faculty Loan Repayment Program (FLRP).
The Health Resources & Service Administration (HRSA) offers this Program to nurses, physicians, doctors, and other health professionals who agree to teach at qualifying schools.
The FLRP Program grants up to $40,000 in loan repayment assistance. It also offers help to offset the tax burden that’s typically triggered when a student loan is forgiven.
To qualify for FLRP you’ll need to:
- Prove you come from a disadvantaged background, based on either environmental or economic factors (or both)
- Hold a qualifying health professions degree.
- Agree to work as a faculty member at an FLRP-approved health professions institution for at least two years.
You can apply for FLRP here.
Alternative to loan cancellation
Waiting for loan forgiveness isn't for everyone. The interest rate accruing on your loans while you wait 10-25 years for forgiveness can be frightening. Plus, there are countless stories of Americans having their forgiveness applications denied. It's understandable if you'd rather explore another option to deal with your debt.
Aside from filing for student loan bankruptcy, your other option is to refinance with a private lender. The benefit of refinancing is that you might get a lower interest rate. But in exchange for that lower rate, you'll lose access to the federal programs I mentioned above: PSLF, IDR, forbearance, etc.
Want help choosing a forgiveness option? Let's get a strategy
Before you refinance federal student loans into a private student loan, make sure you have job security and can comfortably afford your monthly payment.
As a professor at a public university or private school, your pay, while not necessarily low-income, isn't always great. Hopefully, you can take advantage of one of these programs that offer student loan forgiveness for professors.
If you'd like help determining the best option to tackle your student loan debt, schedule a free phone call with me. During that call, we'll review the most viable options for you.