How District Leaders Can Make Sure Teachers Don’t Miss the Loan Forgiveness Deadline

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A waiver that makes it easier for public employees, including teachers, to apply for student debt forgiveness expires Oct. 31, and advocates fear many eligible borrowers won’t know they’re eligible.

Organizations like AASA, the School Superintendents Association, have encouraged education administrators to publicize the deadline to ensure more school staff participate.

“This is a huge opportunity for teachers to have a financial burden removed,” said Tara Thomas, policy analyst at AASA.

And, as districts struggle to recruit and retain employees, being freed from significant debt “could be an important tool in getting them to stay,” she said.

Here’s what school and district leaders need to know:

What is this special loan forgiveness flexibility?

The waiver in question applies to the civil service loan forgiveness scheme, which has come under fire in recent years for cumbersome processes such as proving employment eligibility.

The program is designed to cancel eligible debt for borrowers after 10 years or 120 months of repayment while employed in public institutions, such as school districts and some nonprofit organizations.

The waiver, which will expire Oct. 31, temporarily allows borrowers to receive credit for prior employment periods tied to loan type, repayment plan category or employment verification.

For employees with 10 years of qualifying work, this could lead to rapid debt forgiveness, Thomas said. For employees with less experience, the waiver gives them the option of “locking in” a period of employment under the more flexible rules. They can then fulfill the 10-year requirement under the original program rules once the waiver expires.

Normal PSLF Requirements Included in limited PSLF waiver until October 31
Direct loan payments only Payments on direct, Perkins or FFEL loans
Payments via standard or income-based reimbursement plans only Payments through any repayment plan (including graduated, extended, and others)
Full and timely payments only Late or partial payments
Must be employed full-time by a qualified employer at the time of pardon application May obtain a pardon if not employed by an eligible employer at the time of the pardon application
SOURCE: US Department of Education

Is it different from President Joe Biden’s debt forgiveness pledge?

Yes. In a separate action, President Joe Biden promised to forgive up to $20,000 of eligible student loan debt for all Americans with incomes below $125,000. The US Department of Education plans to issue a pardon application in October.

The civil service loan forgiveness program could go further, erasing all remaining student debt for a smaller group of borrowers, which includes teachers and other public school employees.

Fifty-three percent of K-12 teachers and instructional support staff surveyed took out student loans to fund their education, report finds published last year by the National Education Association. More than half of educators who took out a student loan still had a balance in 2021, with an average debt amount of $58,700.

Some advocacy groups and district leaders have pressed the Biden administration to extend the waiver deadline, giving school employees more time to see if they are eligible.

“It’s about fairness,” Chicago Public Schools CEO Pedro Martinez wrote in a Sept. 7 letter to Biden. “Staff members will show up at their schools on November 1 with the same passion, work ethic and empathy they had on October 31, and their financial situation will also be the same.”

Less than 2% of Illinois public service workers had their debt forgiven at the time of Martinez’s letter, he wrote, adding that many employees may not realize they are eligible .

A spokesman for the Department of Education did not respond to a question about requests for time extensions.

The agency has repaid $10 billion in loans to 175,000 borrowers since the waiver took effect, the agency said in an Aug. 24 news release.. And the agency has proposed long-term changes to the public service loan exemption that “build on the progress” made under the waiver, the statement said.

How can school and district leaders help?

Education administrators can play an important role in ensuring their employees are aware of the waiver and that there are tools to help them navigate it, said Aoife Delargy Lowe, vice -Chair of Law School Advocacy and Engagement at Equal Justice Works, a public service legal organization. . She helped lead webinars on the debt forgiveness process for the PSLF Coalition, a group of organizations, including national teachers’ unions, that promoted the exemption.

“In the education sector, we are in the midst of a shortage of teachers, and canceling education debt can be a way to ensure that people in this profession receive the additional support needed to pursue their teaching careers,” said Delargy Lowe.

Schools in Chicago, for example, educate employees about the waiver every week, Martinez said in his letter to Biden.

The AASA has created a model that superintendents can use to send similar communications to their employees.

As employers, school districts will also be involved in signing applications as part of the verification process. Administrators need to make sure the process is quick and accessible to employees, Thomas said.

Resources to Help School Employees Navigate the Civil Service Loan Waiver Process

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