With about 1% of applicants to the Public Service Loan Forgiveness program successfully receiving loan forgiveness, students who plan to rely on financial aid and hope to become teachers may have reason to think twice.
Nationwide, students are borrowing more student loans to pay for college than ever before. Among those who took out loans, the average student in the class of 2017 borrowed nearly $30,000, according to U.S. News data. But the median midcareer salary is $41,000 for students who majored in early childhood education and $43,000 for those who majored in elementary education, according to U.S. Census Bureau data from 2016-2017.
Rising college costs and low wages create the need for loan forgiveness for teachers, advocates say. But the Public Service Loan Forgiveness program has come under fire recently for failing to keep its promise. A recent lawsuit filed in federal court by the American Federation of Teachers alleges Education Secretary Betsy Devos unlawfully denied individuals debt forgiveness, according to a press release. While the lawsuit is currently pending further action in federal court, its outcome could impact the future of loan forgiveness for current and prospective students.
Students must also consider the possibility of the Public Service Loan Forgiveness program being eliminated, as was proposed by President Donald Trump in March.
Still, Randi Weingarten, president of the American Federation of Teachers, says students shouldn't allow themselves to be deterred by debt. "No one should forgo a career in public service because of concerns over student debt. Yet it's not a secret that the teaching profession is facing a crisis -- deep, systemic disinvestment in public education that has led to soaring college costs and shrinking teacher salaries, and a de-professionalization of the job that has led to a teacher shortage in all 50 states," Weingarten wrote in an email. "But teaching is a career built on hope, and a commitment to helping others and making our communities better. We must honor that commitment and protect the future teacher workforce."
Amid this uncertainty, Mark Kantrowitz, publisher and vice president of research for Savingforcollege.com, a website that provides information for parents and financial professionals, says students may not need to worry about loan forgiveness as much as they think.
"Right now, the prospects for eliminating Public Service Loan Forgiveness are slim, as are the prospects for improving it," he says. "You can probably be certain that if you're going to college this fall, Public Service Loan Forgiveness will still be there. But more long-term, it remains to be seen how the program is going to evolve."
Even so, in Oklahoma, where teacher pay has historically been some of the worst in the nation, Melanie Rinehart, director of financial aid at Seminole State College, advises her students who plan to become teachers to exercise caution. She tells them to pretend forgiveness doesn't exist when planning their financial future, and even advises students on the fence about becoming teachers to explore other majors or consider double majoring.
"They always say getting a degree will equal better pay. Well, unfortunately for teachers, especially here in Oklahoma, that's not always the case," Rinehart says. "I always tell (students) there is a possibility (for forgiveness), but I also tell them to never count on it because they've even talked about doing away with the program." Meanwhile, "students now are holding their breath to know if this will even be an option by the time they graduate," she says.
For those who do study to become teachers, there are three primary options for student loan forgiveness: Public Service Loan Forgiveness, Teacher Loan Forgiveness and loan forgiveness for teachers offered by a student's state or institution. Additionally, students might consider the Teacher Education Assistance for College and Higher Education Grant, which is similar to a forgiveness program.
Public Service Loan Forgiveness
Qualifying for the Public Service Loan Forgiveness program is complex: It requires years of annual paperwork and significant foresight to ensure all of the requirements are met. First, individuals must work for a qualifying employer, which includes government agencies and some types of nonprofit organizations. Loans must be direct federal loans , and they must be repaid on an income-driven repayment plan. Individuals must make 120 qualifying payments over the course of 10 years before they are eligible for forgiveness.
If an individual's application is successful, the remaining balance of their loan will be forgiven.
The complexity of the program may be the biggest stumbling point for most students, Kantrowitz says. Those hoping to receive this form of forgiveness must be meticulous in following the qualification requirements set by Congress.
And since the program is still in its infancy and students only first became eligible for forgiveness in 2017, he says more students could receive forgiveness as the program matures.
Teacher Loan Forgiveness Program
The Teacher Loan Forgiveness Program has a cap of either $17,500 or $5,000, depending on the subject area a student goes on to teach. After graduating, students must work full time for five complete and consecutive years at a low-income school or educational service agency to qualify for forgiveness.
To receive up to $17,500 in forgiveness, students must go on to become highly qualified math or science teachers at the secondary level or become certain kinds of special education teachers.
State and Institutional Student Loan Forgiveness for Teachers
Some colleges and states offer forms of student loan forgiveness for teachers. The American Federation of Teachers provides a database of such state loan forgiveness programs for teachers. Many of these aim to incentivize students to enter the teaching profession and respond to shortages by providing forgiveness.
Experts say students who know they are likely to take on debt and are interested in becoming teachers should talk with the financial aid office at their current or prospective institutions for information on loan forgiveness options.
The Teacher Education Assistance for College and Higher Education, or TEACH, Grant is not a forgiveness program, but it is similar in that students receive a grant for college in exchange for meeting certain requirements after graduating, and if those requirements are not fulfilled, the grant becomes a loan.
This program may be a good option for students who are unsure of their desire to become teachers, because the commitment is four years instead of the 10 years required by the Public Service Loan Forgiveness program.
To be eligible, students must meet certain academic achievement requirements and sign an agreement to serve. This agreement is a commitment to serve in a high-need field, at a school that serves low-income families, and to teach for four complete academic years within eight years of completing the course of study for which the student received the grant.
Trying to fund your education? Get tips and more in the U.S. News Paying for College center.
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