If you’re considering student loan forgiveness you’ll need to know what the three major federal student loan forgiveness options are. While there are a lot of smaller niche loan forgiveness programs available, these three cover the most common options through the Department of Education.

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3. Teacher Loan Forgiveness

What it is: Teacher Loan forgiveness forgives up to $17,500 if a borrower teaches full-time for five complete and consecutive academic years in a low-income school or educational service agency, and meets other qualifications.

Eligible Loans: Federal subsidized and unsubsidized undergraduate loans (both Direct and Stafford). Graduate loans aren’t eligible for Teacher Loan Forgiveness, but if you have a Direct Consolidation Loan the undergraduate portion of that loan is eligible for forgiveness. Only loans made before the end of the five years of qualifying academic service are eligible for forgiveness.

Eligibility Criteria: 

• Be a highly qualified teacher.
• Teach at a low income school.
• Teach full-time for five academic years. *Note: taking summer break is still considered full-time employment.
• Have an outstanding loan balance after Oct 1, 1998.
• Loans must be in good standing, not in default.

Forgiveness Amount: Math and science teachers at the secondary level or special education teachers at either the elementary or secondary level are eligible for $17,500 of forgiveness. All other teachers may receive up to $5,000.

2. Income-Driven Loan Forgiveness

What it is: Income-Driven Loan Forgiveness forgives a borrowers remaining loan balance after 20 to 25 years of income-driven payments.

Eligible Loans: Determined by which of the four income-driven plans a borrower chooses. Direct loans that don’t include Parent PLUS loans are eligible for all four of the income-driven repayment plans. Direct Consolidation Loans that are used to pay off Parent PLUS loans are only eligible for Income-Contingent Repayment. FFEL loans that haven’t been consolidated to a Direct Loan can be repaid through the Income-Based Repayment Plan.

Eligibility Criteria: Any borrower with a remaining balance who made payments under an income-driven repayment plan for 20-25 years.

Forgiveness Amount: There is no cap on the amount of student loans forgiven. However, the forgiven amount of student loan debt is taxable as income.

1. Public Service Loan Forgiveness (PSLF)

What it is: Public Service Loan Forgiveness (PSLF) forgives a borrowers remaining loan balance after 120 payments were made under a qualifying repayment plan while working full-time for an eligible employer.

Eligible Loans: Direct Loans, including Direct Consolidation Loans are the only student loans that are eligible.

Eligibility Criteria: 

• Work full-time for a qualifying employer.
• Make 120 qualifying payments.
• Remain on an income-driven repayment plan.
• Keep your student loans in good standing.
• Submit the PSLF Application after making 120 payments.

Forgiveness Amount: There is no cap on the amount of student loans forgiven.

Are you considering student loan forgiveness under one of these three options? Let me know in the comments below or on the Repayable Facebook Page if you’re planning on getting Teacher Loan Forgiveness, Income-Driven Loan Forgiveness, or Public Service Loan Forgiveness.