To assure that your Common Manual remains current, please record this document on your LPM/LPB index, and retain it in Appendix E of your manual.

The Federal Teacher Loan Forgiveness Program (HEA 428J) provides for repayment of up to $5,000 in loan principal and interest for borrowers who meet the eligibility criteria. When a loan holder believes a borrower to be eligible for this discharge, he should provide the borrower with the Teacher Loan Forgiveness application. After loan holders review the completed application to confirm that the borrower is eligible they should complete the Teacher Loan Forgiveness Discharge Request form and forward the application and the discharge form to Program Review at LOSFA for processing.

To be eligible for this forgiveness program, a borrower must meet the following criteria:

• The borrower must be a "new borrower " on or after October 1,1998. A new borrower is defined as one who does not have an outstanding balance on a FFELP loan as of October 1, 1998.
• The borrower must have been employed as a full-time teacher for 5 consecutive, complete academic years in a qualified school, as certified by the chief administrative officer at that school. A qualified school is one that meets all of the following criteria:
  • Is in a school district that qualifies for funds under Title I of the Elementary and Secondary Education Act of 1965,as amended.
  • Has been selected by the Department based on a determination that more than 30 percent of the school 's total enrollment is made up of children who qualify for services provided under Title I.
  • Is listed in the Annual Directory of Designated Low-Income Schools for Teacher Cancellation Benefits . (If this directory is not available before May 1 of any year, the previous year 's directory may be used.)
• If the school where the borrower is employed meets the eligibility criteria for any year of the borrower 's employment, all subsequent years continue to qualify the borrower even if the school is no longer eligible. However, if the borrower is initially employed by a school that does not meet the criteria and the school later qualifies, the borrower 's 5 qualified years of service begin when the school meets the eligibility criteria.
• If employed as an elementary school teacher, the borrower must have demonstrated knowledge and teaching skills in reading, writing, mathematics, and other areas of the school 's curriculum, as certified by the chief administrative officer of the school at which the borrower is employed.
• If employed as a secondary school teacher, the borrower must be teaching a subject which is relevant to the borrower 's academic major, as certified by the chief administrative officer of the secondary school at which the borrower is employed.
• One of the 5 years of qualifying service must be performed after the 1997-1998 academic year.
• A borrower who is in default on a loan(s) for which the borrower seeks forgiveness must have made satisfactory repayment arrangements on the defaulted loan(s) to reinstate Title IV aid eligibility.

The loan for which forgiveness is sought must have been made before the end of the 5th year of qualifying teaching service. A borrower who is a teacher may receive forbearance during the period in which the borrower is completing the teaching requirements for teacher loan forgiveness. Borrowers will be required to complete the Teacher Loan Forgiveness Forbearance Form to establish their eligibility for the forbearance and to agree to the terms of the forbearance.

A copy of the Teacher Loan Forgiveness forbearance form, application and discharge request form are attached to this bulletin. Lenders may also obtain electronic versions as follows:

• Teacher Loan Forgiveness Forbearance Form at www.ifap.ed.gov/dpcletters/attachments/gen0115a.pdf

• Teacher Loan Forgiveness Application Form at www.ifap.ed.gov/dpcletters/attachments/gen0115b.pdf

• Teacher Loan Forgiveness Discharge Request at www.nchelp.org/events/past_events/Training_2001/TC 01/Teacher Loan Forgiveness/TLFDR final 06-04-01.doc

The following website provides information about cancellation/deferment options for teachers, including elementary and secondary schools designated by the Department by year:

• www.ed.gov/offices/OSFAP/Students/repayment/teachers.