How pub­lic ser­vice work­ers can get stu­dent loans for­given

USA TODAY Weekend Extra - - NEWS - Gre­gory Korte

You took out stu­dent loans to go to col­lege, and then you started a ca­reer in pub­lic ser­vice, as a po­lice of­fi­cer, a teacher, a nurse, a so­cial worker.

Good news: The gov­ern­ment wants to re­ward you for your ser­vice. Af­ter 10 years, you could be el­i­gi­ble for stu­dent loan for­give­ness, wip­ing out an av­er­age of $58,000 in loan debt.

Good news, that is, if you’re one of the 206 peo­ple who have qual­i­fied for the fed­eral pro­gram. Not so much if you’re one of the 41,000 oth­ers who have ap­plied and been de­nied.

The form to re­quest for­give­ness is de­cep­tively sim­ple: It’s just two pages, not in­clud­ing in­struc­tions. But there are any num­ber of ways to get tripped up. And bor­row­ers who wait 10 years to ap­ply might dis­cover that they’ve made cru­cial mis­takes at some point along the line.

Many of those mis­takes can be over­come if caught in time. That’s why the Depart­ment of Ed­u­ca­tion en­cour­ages bor­row­ers to sub­mit an em­ploy­ment cer­ti­fi­ca­tion form ev­ery year, or ev­ery time you change jobs. It’s the best way to raise your hand to let the gov­ern­ment know you’re in­ter­ested in loan for­give­ness.

Re­quire­ments for the pro­gram are set by law. Nei­ther loan ser­vicers nor the Depart­ment of Ed­u­ca­tion can waive them. But some bor­row­ers say ser­vicers have lied to them about their el­i­gi­bil­ity for the pro­gram in order to keep them in higher-mar­gin loans. So it’s im­por­tant to un­der­stand each of the four ma­jor re­quire­ments:

Work in a pub­lic ser­vice job

“Pub­lic ser­vice job” is de­fined in the law. It in­cludes full-time em­ploy­ment (at least 30 hours a week) in:

❚ Any level of gov­ern­ment, in­clud­ing the mil­i­tary, pub­lic safety, law en­force­ment, the Peace Corps or Ameri­corps;

❚ Pub­lic ed­u­ca­tion, in­clud­ing early child­hood ed­u­ca­tion;

❚ So­cial work in a pub­lic child or fam­ily ser­vices agency;

❚ Pub­lic in­ter­est le­gal ser­vices, in­clud­ing pros­e­cu­tion, pub­lic de­fense, or le­gal aid in a low-in­come com­mu­nity as part of a non­profit or­ga­ni­za­tion; ❚ Pub­lic or school-based li­braries;

❚ Pub­lic ser­vice in child care, ser­vice for in­di­vid­u­als with dis­abil­i­ties, or the el­derly;

❚ Any other work at a tax-ex­empt pub­lic char­ity es­tab­lished un­der 501(c) (3) of the tax code;

❚ Teach­ing at a tribal col­lege or ina high-needs area as de­ter­mined by the Depart­ment of Ed­u­ca­tion;

Not qual­i­fied: La­bor unions, par­ti­san po­lit­i­cal or­ga­ni­za­tions, for-profit or­ga­ni­za­tions.

Some of these qual­i­fi­ca­tions can get tricky, es­pe­cially in the non-profit realm. For ex­am­ple: Work for a re­li­gious or­ga­ni­za­tion could qual­ify, but time spent on re­li­gious ac­tiv­i­ties wouldn’t count to­ward full-time sta­tus.

Have the right kind of stu­dent loan

Only direct loans from the U.S. Depart­ment of Ed­u­ca­tion are el­i­gi­ble. Stafford loans, Perkins loans, and Par­ent PLUS loans are not el­i­gi­ble. Rule of thumb: If your loan doesn’t have the word “direct,” it’s the wrong kind of loan.

But that doesn’t mean you can’t still pur­sue loan for­give­ness. Just con­sol­i­date your ex­ist­ing loans into a direct loan, and fu­ture pay­ments could be el­i­gi­ble.

Have the right re­pay­ment plan

There are eight kinds of re­pay­ment plans for stu­dent loans. To take ad­van­tage of the pro­gram, bor­row­ers should be in an in­come-based re­pay­ment plan, or get into one as soon as pos­si­ble. Those plans in­clude:

❚ Pay As You Earn.

❚ Re­vised Pay As You Earn.

❚ In­come-Based Re­pay­ment Plan.

❚ In­come-Con­tin­gent Re­pay­ment Plan.

(If you’re in an In­come-Sen­si­tive Re­pay­ment Plan, you’re in the wrong kind of loan. Make sure you have a direct loan.)

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