Loan Forgiveness For Police And Firefighters
We have previously discussed how students and some qualified civil servants could see their debt forgiven through the Student Loan Forgiveness scheme. We have equally discussed extensively on how Donald Trump’s Tax Cuts & Jobs Act Policy could affect the highly effective program.
In today’s post we shall be discussing how Policemen and firefighters could see their debts being forgiven by the US government via the Public Service Loan Forgiveness Program.
For the the sake of people who missed out on our previous posts on Donald Trump’s tax cut policy and its effect on the Student Loan forgiveness program, below are some important facts you need to know about the student loan forgiveness and Public Service Loan forgiveness program.
What Does Student Loan Forgiveness Mean?:
Student loan forgiveness is a program initiated by the US government aimed at overlooking part of the debt owed by qualified citizens of the country. You can only be included in this program if the money you borrowed from the federal government was strictly spent on achieving your academic goals and dreams.
With this program, many eligible US citizens didn’t need to repay all of the debts they owed the federal government as the remainder of their debts could be wiped off by the government.
This Student loan forgiveness is not only opened to students alone, civil servants and public workers are equally eligible to enjoy this awesome opportunity but in a slightly different form. As a Civil servant who wants to see their debt being forgiven by the government, you need to be part of the Public Service Loan Forgiveness Programme.
What’s Public Loan Service Forgiveness Program?
Public Service Loan Forgiveness is also known as PSLF, and it is a program that gives qualified public servants the chance to see their debt being forgotten or forgiven by the US government.
With this program, you — as an eligible public servant — will see your debt on your student loan account being forgiven.
However, you need to meet some criteria to confirm your eligibility status, and we shall be revealing this criteria later.
How To Enjoy The PSLF Program?
For you to enjoy this wonderful program, you need to possess some factors or criteria which include the following:
1. Your loan Account Must be Covered By The Federal Government’s Loan Forgiveness Program
If you must qualify to enjoy the PSLF program, your student loans account must be included in the loan forgiveness program. What this means is that the money you borrowed to sponsor your education while you were in school — also known as the Federal Student Loan— must be payable by the Federal government through the PSLF program.
How is this possible? This is possible if you borrowed money from quarters or loan-giving organizations that are eligible to enjoy the program. Some of these loan-giving organizations include the following
- A. The Federal Family Education Loan (FFEL): This loan program is one of the ways student can borrow some amount of money that will be enough to see them through their academic program. Though this program is overseen by qualified individuals, the Federal government have a huge say in the program because they are the major source of finance given to borrowers.
- B. A Direct Subsidized Loan: This is a government-backed student loan that gives you the opportunity to borrow without any interest rate throughout the years you spend in school.
Also known as subsidized Stafford Loan, this type of student loan scheme ensures that you — as an undergraduate student — are only mandated to pay the exact amount of money you borrowed from the government during your days in school as you’re entitled to enjoy a grace period ( a six-month period where no interest is attached to the money you borrowed).
However, interest will be accrued to your debt six months after graduating from school. You must also prove that you’re in need of the money to cater for your tuition fee before you can be granted this loan.
- C. Direct Unsubsidized Loans: This is a bit different from the Subsidized Loan as it is open to both undergraduate and graduate students who need financial help from the government. You don’t need any evidence to prove that the borrowed money will be spent on school fees. Hence, you can do anything with the loan given to you. You’re expected to pay the accrued interest as soon as you are done with all schooling activities as there is no grace period.
D. Direct PLUS Loan: This is another loan-giving platform that guarantees your chances of seeing your debt being overlooked via the PSLF program. The good side of this loan platform is that there is no limit to the money you can borrow. However, you mustn’t borrow beyond the exact amount of money needed to settle all your tuition fees. This is why you’re advised not to attend pricey institution as it could turn out to be a burden if it wasn’t forgiven.
[su_note note_color=”#e5dede” text_color=”#444444″ radius=”12″] Direct PLUS Loan is of two types: The PLUS—Grad PLUS and The Parent PLUS. The first type is on opened to graduate or professional students who are financially handicapped to sponsor their masters degree program. This type of Direct PLUS loan includes an interest rate which commences as soon as you are granted the loan.
As for the second type of the Direct PLUS Loan (that’s the Parent Plus), the loan program is only open to parents or guardians who want to borrow money on behalf of their undergraduate children. There is no huge difference between this type and the PLUS—Grad as it also includes immediate interest and there is no limit to the amount you can borrow.[/su_note]
2. You Must Be Involved In A Direct Consolidation Loans
This is another criterion that ensures that you’re are eligible to partake in the PSLF program. A Direct Consolidation Loan is a type of federal loan system created by the US Department of Education (DOE) that gives you the chance to combine many Federal loan accounts into one single new loan account.
Direct Consolidation loan now gives you the chance to see your different Federal loan accounts converted into one major or huge debt account while you continue to repay them monthly.
As a result of consolidated loan account, you may be given an extended time to repay all of your debts, and your chances of seeing them being forgiven will massively increase. The Direct Consolidation loan also provides you with the opportunity to choose a new repayment plan, depending on your financial capacity.
3. You Must Be Working In Government-owned Organizations
If you must enjoy the PSLF program, then, you must be working with a governmental organization. You should be a federal government worker, state worker or local government. That’s not all, you’re advised to become a full-time worker in a government-owned or not-for-profit organization to boost your chances of benefiting from the PSLF program.
4. 120—Month Qualifying Payments
This factor is very crucial to your chances of being a beneficiary from the PSLF program. According to the Public Service Loan Forgiveness eligibility requirements, you need to pay part of your loan amount in 120 months (10 years) before your debt could be overlooked by the government.
5. Your Loan Must Be Out Of Default
A default loan automatically prevents you from being an eligibility candidate, which is one of the reasons why you must endeavor to get your loan out of default. Your loan account will be defaulted by the Department of Education if you fail to follow your payment plan.
However, every loan has its own unique date in which it will be defaulted by the appropriate authorities. As for the Federal Family Education loan, it will be defaulted if you neglect your repayment plan for 270 days.
If you eventually find yourself in this situation, there are only three ways to bring your loan out of default mode. They are:
- Loan Rehabilitation: This practice includes signing an agreement with concern quarters that you will pay at least $5 every month, non-stop for nine consecutive months.
- Loan Consolidation: This allows you to combine all your debts into one single account. We’ve talked about this earlier, we believe there is no need repeating it.
- Make A Full Payment at A Go: This means paying all your debts at once as that will cover up for the time you failed to honor your repayment plans. As much as making a full payment at a time seems unattainable, this is arguably the best way to get your loans out of default.
Does Policemen and Firefighters Stand A Chance Of Benefiting From The Public Service Loan Forgiveness Scheme?
As said earlier, public servants are set of people who have a high tendency of benefiting from the PSLF program. This means that Policemen and firefighters are eligible to be part of the Public Service Loan Forgiveness Program.
However, not all Policemen or firefighters are guaranteed to enjoy the program as some officers are working with unsupported agencies.
This means that the agency you’re working with (as a policeman or a firefighter) also determines whether you’re qualified for the program or not. If your agency or your employer isn’t eligible to benefit from the PSLF program, I’m sorry you don’t have a chance at all.
This is why it is very important to certify your employment position or the agency you belong to as soon as you possible to know if your agency is eligible or not.
Top Important Information About PSLF For All Policemen or Firefighters
1. You Must Completely Work In Government-owned Agency To Qualify: You must be a complete public servants. Complete — as used in this context — means being a full-time policeman in any government-owned or public office. You must also know that your status as a public servant must remain unchanged throughout your repayment period (usually 10 each year).
2. Your Repayment Plan Depends On Your Income: As much you need to repay part of your debt in 120 months before the remaining debt could be forgiven, your repayment plan is determined by your monthly salary as a police or the firefighter. Endeavor to make enquiries about the available repayment plans and see which one you’re eligible to choose from.
3. Get A Specialist Who Knows The Inside-out of The Federal Student Loan System Before Applying: According to reports, only 289 student loan forgiveness applications were approved by the US Department Of Education of out 29,000 applications. This is because many applicants didn’t follow the right procedures while some didn’t meet the requirements.
Hence, it is very important to seek the indulgence of an expert or someone who knows how the Federal Student Loan system operates. This person must know what it takes to come up with quality application, and he or she must know much about the repayment plan and how it will affect your chances of seeing your debt being forgiven by the government.
The Alternative Option Available To Policemen and Firefighters Interested In Loan Forgiveness Program
There is another option available to those who were ineligible to benefit from the PSLF program. This method or option is known as the Perkins Loan Cancellation. Before we discuss on Perkins Loan Cancellation, let’s quickly unveil some cogent facts about Perkins Loan and how you can obtain it.
Formerly known as the National Defense Student Loan or National Direct Student Loan, Federal Perkins Loan Program is a platform created to boost students’ dream of achieving academic excellence. This program involves granting loans to post-secondary students who are financially unfit to pay their tuition fee.
The impressive part of this program is that loans given to students only accrue low interest and the borrowed money will be paid back after ending their academic career.
How To Obtain The Federal Perkins Loans
Obtaining a Perkins Loan requires you to be a student of the 1,700 approved institutions. Once that is done, you can now apply for the loan by filling all necessary forms and documents such as the Free Application for Federal Student Aid (FAFSA).
Perkins Loan Cancellation Program
Though you’re currently a Policeman, your Perkins loans debt can be forgiven through this program. You can cancel your debt or Perkins loan after working in an eligible agency for consecutive five years without a break or change of occupation during the years in review.
As a police, firefighter or other military personnel, only fractions of your Perkin loans will be forgiven, unlike some occupation that gives borrowers the chance to enjoy complete cancellation. The process whereby only half of your Perkins Loan is canceled is known as Partial Cancellation.
Teachers, Healthcare service providers, medical practitioners, law enforcement officers and people involved in child or family services are all eligible to enjoy 100% Perkins Loan cancellation.
How To Enjoy Perkins Loans Cancellation Program
It is believed that you must apply for the cancellation program form to stand a chance of canceling your debt. You must obtain the Perkins Loan Cancellation form and fill it with appropriate information.
How To Fill The Perkins Cancellation Form With Appropriate Information Without Errors?
Many people often find it hard to fill out the Perkins loans Cancellation form, hence, we have provided you with a clue on how to fill the form.
- Borrowers Name and Address: Your name and current address are strictly needed, so endeavor to provide updated information.
- Lending Institutions For The Perkins Loan: Provide the name of the school that granted you the loan in the first place.
- Account Number: Provide your Student ID number given to you by the school. You can equally provide your social security number.
- Provide the name of your current full-time occupation
- Provide your signature, your phone number and the date which you obtain the form.
- Certifier’s Signature: A senior colleague or an official in your place of work must provide his or her signature to confirm that you’re a full-time employee.
- Job Description: You must describe the job you do in a written format and attached it to the form before you submit it.