Loan Forgiveness for Social Workers

NASW is promoting loan forgiveness for social workers as part of its on-going work to improve working conditions, salaries, and other benefits for members of the profession and to ensure that consumers have access to qualified professionals. NASW will continue its support for proposals to provide loan forgiveness for social workers in child welfare and schools, while also working to secure loan forgiveness and other educational supports for social workers in other practice areas.

Two recently passed bills that offer loan forgiveness for social workers are the Higher Education Act and the College Cost Reduction Act of 2007.  You can find out if you are eligible for these programs by contacting the Federal Student Aid Information Center at 1-800-433-3243.  It is important to note that NASW does not determine loan forgiveness eligibility, nor does NASW disperse loan forgiveness funds.  However, NASW does, offer scholarships.

Another federal program that helps social workers is the National Health Service Corps Loan Repayment Program (NHSC LPR). This program offers fully trained and licensed clinical social workers $50,000 to repay student loans in exchange for two years serving in a community-based site in a high-need Health Professional Shortage Area (HPSA) that has applied to, and been approved by, the NHSC as a service site. For more information about the loan repayment program, eligibility requirements, employment opportunities in HPSAs, and NHSC contact information, click here.

If you are having difficulty paying your loans, contact your lender immediately.  You may qualify for deferment, forbearance or another form of payment relief.  It is important to take action before you accrue late fees as this may impact your eligibility for payment relief or loan forgiveness programs.

http://www.naswdc.org/loanforgiveness/default.asp

Help for graduates

Other changes that took effect July 1 could provide relief for graduates who aren't making enough money to afford their loan payments.

The income-based repayment program allows federal student loan borrowers to have their loan payments reduced, based on income and family size. For most eligible borrowers, loan payments will be less than 10 percent of their income. Two updates to the program could lower payments even more for some borrowers:

·  Married couples will no longer be penalized. Previously, when couples filed a joint tax return, the program assumed that both spouses could use 100 percent of their combined income to make loan payments. In cases in which both spouses had student loans, the minimum payments were much higher than the minimum for unmarried borrowers with the same debt and income, said Lauren Asher, president of the Institute for College Access and Success. The new formula will take into account married couples' combined income and their combined debt to calculate minimum payments, Asher said.

·  Eligibility for income-based repayment will be based on the balance when the loan went into repayment or the current loan amount, whichever is greater. This will primarily benefit borrowers who have gone into forbearance or deferment, Asher said. These programs allow borrowers to temporarily suspend payments, but if interest accrues during the period, they end up with a larger loan balance.

For more information about income-based repayment, go to www.ibrinfo.org.