Student Loan Dodgers

The new student loan legislation passed by Congress in August was just signed today by President Bush. Since the College Cost Reduction Act of 2007 is now authorized, it will provide student loan debt relief to students who choose to enter certain professions and remain employed in those professions for ten years.

During the ten year period, students who are employed as police officers, social workers, school librarians, government workers, members of the military, public defenders and prosecutors. Professionals in these occupations are in high demand, but the annual salary is typically low, the work is highly demanding, and the burnout rate is high.

During the ten years following school, these professionals must make regular student loan payments and the student loans must have been made through the Federal Direct Student Loan Program. Student Loans that were not made through the FLDP but are consolidated through the federal plan will be eligible for forgiveness, but payments made prior to the effective date of the law will not count toward the 10-year pay-off period.

The new student loan legislation also provides tuition relief for students who enter the teaching profession, but only for those who teach subjects in high demand, like math, science, foreign language or special education. The grants, which provide up to $4,000 per year are designated for graduates who are willing to teach for four years in areas where educators are in short supply. Graduates have eight years following graduation to fulfill their four-year commitment. If the commitment is not fulfilled, the grants convert to unsubsidized student loans and the borrower must pay back the student loan and all accrued interest.

These opportunities for tuition grants and debt relief will make it easier for students who are already interested in working in these fields to accept lower-paying jobs in the public sector, and teaching assignments in areas that they may not otherwise consider. Students who are simply looking for debt and tuition relief may not find these career choices attractive enough, even with the added incentives, to pursue these benefits.