4 student loan forgiveness options for teachers | Earnest | Earnest

4 student loan forgiveness options for teachers

By Carolyn Morris | Published on October 21, 2025

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Teachers play a vital role in shaping the next generation and instilling the value of an education. However, earning the degrees and certificates to mold minds as an educator does not come easy. In some cases, it can be an expensive decision. According to the Education Data Initiative, the average Master's degree in education costs about $42,000. That’s comparable to some MBA programs. But the average salary for an MBA graduate is at least $140,000 in most states, whereas the national average for a teacher is closer to $70,000. So how can teachers pay back the debt they took out to become an educator? Besides the popular budgeting tips, there are a number of federal and state-sponsored programs that teachers may be able to apply for to help bring that debt down. Here are some of the most popular teacher loan forgiveness programs.

1. The Teacher Loan Forgiveness program

Qualified teachers are eligible to receive forgiveness of up to $17,500 or $5,000 on Direct Subsidized and Unsubsidized Loans through the Teacher Loan Forgiveness Program (TLFP) depending on various factors. But who is qualified? First, you must first have taught “full-time for five consecutive years in a low-income school or educational service agency,” according to TLFP resources on studentaid.gov. You also must also meet these eligibility requirements:

Next, you need to confirm that your school qualifies as low-income by checking for it on the Teacher Cancellation Low Income (TCLI) Directory. This is a list of schools considered to be low-income schools, as compiled by the U.S. Department of Education.

Full-time math and science middle school and high school teachers and special education teachers may qualify for the largest loan forgiveness amount, $17,500. Teachers who don’t teach math, science, or special education may still qualify for up to $5,000 in loan forgiveness. While not as large of a chunk of change, $5,000 is still a dent in your loans that does not have to come out of pocket. You can submit your teacher loan forgiveness application to your loan servicer after five years of teaching if you meet these requirements.

2. Public Service Loan Forgiveness program

Public Service Loan Forgiveness (PSLF) is a large program that educators often qualify for. Qualified individuals can apply for the federal government to forgive their remaining balance on Direct Subsidized and Unsubsidized Loans after making 120 qualifying payments. (That’s ten years of loan repayment for most borrowers.) These all need to be full payments, made within 15 days of the deadline, and you need to have started those payments after October 1, 2007.

To start making these qualifying payments, you’ll have to first enroll in an Income-Driven Repayment Plan. This is a type of repayment plan offered by the government. If you’re not already enrolled in an income-driven repayment plan, you’ll need to first consolidate your federal student loans. At the end of the consolidation process, you’ll be able to choose from a variety of repayment plans, including income-driven repayment.

To qualify for PSLF, you must be employed by one of the following:

You can search your employer in the federal PSLF database to see if they qualify.

3. Perkins Loan Cancellation for teachers

While the Perkins loan is no longer offered by the federal government, you can still get existing Perkins loans forgiven if you’re an educator. For each academic year working full-time, a qualified teacher is eligible to have a portion of their loan canceled through the federal Perkins Loan Cancellation program.

To qualify for the cancellation program, you must have worked full-time in a public or nonprofit elementary or secondary school system as one of the following:

The cancellation of your loan can be up to 100%, including interest accrued during that year, but is over the following increments:

To apply for Perkins Loan discharge, borrowers will need to reach out either to the loan servicer of the Perkins Loan or to the school who issued the Perkins Loan. This is the only way to apply for Perkins Loan Cancellation.

4. The TEACH Grant program

The Teacher Education Assistance for College and Higher Education (TEACH) Grant is a form of federal student aid for future teachers. You could qualify if you’re considering going to school to earn a bachelors, masters, or post-baccalaureate degree in education and plan to work in a high need field or a low-income district. Unlike the previous programs discussed, this grant program provides the student with up to $4,000 each year to help with the cost of education.

There is a complete list of qualifications on the TEACH website that applicants should review before applying. If the student does not fulfill the work conditions the grant requires, the grant money will instead be converted to a federal Direct Unsubsidized Loan. Interest will then be added on to the principal from each date when the grant was disbursed.

State-sponsored student loan forgiveness programs

Besides federal programs, there are also a number of options offered by individual states to help teachers with loan forgiveness. The American Federation of Teachers website includes a comprehensive list of available programs. Most of the programs focus on supporting teachers working in low-income areas.

The pros of student loan forgiveness programs

The immediate upside of teacher loan forgiveness is you’ll save money on your student loans — often a significant amount. Federal forgiveness programs are also not seen as taxable income, which means you won’t have to pay any sneaky taxes on the money awarded to you. This is not the case for all non-federal programs, so make sure you take that into account and declare debt forgiveness correctly on your taxes.

The cons of student loan forgiveness programs

Not every teacher will fit the qualifications for loan forgiveness. Generally, you have to be teaching in a set area or subject matter for an extended period of time, which can limit career opportunities. There are also different values to the eligible forgiveness amount based on when you graduated, which means some teachers will be able to save more than others.

Another con to leaning on a loan forgiveness plan is that you are unable to refinance your loans with a private lender. The federal loan forgiveness programs are only for federal loans. If you refinance with a private lender, your federal loans will become private loans. This process cannot be reversed.

Refinancing as an alternative to student loan forgiveness

If you are unable to take advantage of federal or state loan forgiveness programs, then refinancing could be an option to potentially lower your monthly payments and help you save money over the life of your loans. When you refinance your student loans, you exchange your current education debt for a single new loan with a new lender. Because this is a brand-new loan, you’ll have the opportunity to shorten or lengthen your repayment term and potentially get a lower interest rate. That could help you reduce your monthly payments and/or get out of debt faster.

Think refinancing could be a good fit for you? Use our student loan calculator today to see how much you could save.

About the Author

Carolyn Morris

Carolyn is a content marketer and editor who specializes in financial services. With over a decade of experience in the financial services industry, Carolyn has a passion for demystifying the loan application and repayment process for students and their families.