Quick Answer: PSLF allows school principals to make income-driven payments (typically much lower than standard 10-year payments) for 120 months, then receive forgiveness of remaining balances. A principal with $200K in loans would likely pay significantly less than the full amount over 10 years through income-based repayment plans.
I have about $190,000 student loans-government backed- I capped the $148,500 and then got PLUS loans for graduate school.
I am looking at the “public sevice loan forgiveness” option as I am a principal at a public school.
What I do not understand is if you have to make 120 payments based on a ten year repayment schedule to qualify to have the balence of your loans forgiven, what is being forgiven?
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If you take your full balence and make payments on a 120 month schedule, you are paying the entire balence, right? The payements would be huge and I do not see how it will be of any benefit. I have $114K in a consolidation plan that is on a 30 year schedule, and the rest in Sallie Mae and PLUS loans on a ten year schedule. I believe to qualify for the PSLF plan, I have to have all of it on a 120 month schedule.
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I will be finishing my Ed.D in the next year or so and will have to start repaying all of this…which will be above $200K by then. Do you know of any options to have any of this forgiven or to make it more affordible. Here is the link to the program.
Thanks for your help.
Jim
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Jim,
Are you saying that your scheduled repayment period on those loans is ten years to begin with?
The Sallie Mae loans would not be eligible and all the eligible loans would need to be consolidated into the Direct Loan Program.
Once consolidated, typically, the repayment period is much like what you have on your 30 year plan. Under the Public Service Loan Forgiveness Program, you would be able to discharge the last 20 years of payments on a 30 year consolidated Direct Loan.
Steve