Guide to Student Loan Forgiveness for Volunteering
There are many ways to give back to your community through volunteering. And, in some cases, you can get rewarded for helping others by getting a little help with your student loans. In particular, if you join the Peace Corp or volunteer with AmeriCorps, there are loan forgiveness options available to you. Here is how to get student loans forgiven by volunteering.
Public Service Loan Forgiveness
The Public Service Loan Forgiveness Program provides relief from student debt to borrowers who work in qualifying jobs that serve the public good. The Department of Education has made clear that serving as a full-time volunteer for either the Peace Corps or AmeriCorps can enable you to qualify for PSLF. You will need to meet the organization’s definition of full-time or work at least 30 hours per week though.
PSLF is available for eligible federal student loans, including subsidized and unsubsidized Direct Loans, PLUS Loans, and FFEL Loans that have been consolidated using a Direct Consolidation Loan from the Department of Education. You will need to enroll in an income-driven plan for your loans and make 120 on-time payments while volunteering or working at an eligible job.
After you’ve made all your required payments, loans should be forgiven as long as you’re still doing public service work at the time.
Perkins Loan Cancellation
Volunteer service with AmeriCorps VISTA or with the Peace Corps can open the door to Perkins Loan cancellation. Up to 70% of the balance of your Perkins Loan may be forgiven if you volunteer with these organizations for four years.
You’ll have 15% of your balance forgiven in each of the first and second years of service and will have 20% forgiven for the third and fourth year of eligible service. The forgiven amount also includes any interest accrued during each year when volunteering for either the Peace Corps or AmeriCorps VISTA.
Segal AmeriCorps Education Award
The Segal AmeriCorps Educational Award can be used both to pay educational expenses at a qualifying educational institution or to repay existing student debt that you’ve acquired. You can use the award only to repay eligible loans, including those backed by the federal government under Title IV of the Higher Education Act; loans issued under Titles VII or VIII of the Public Service Health Act, or loans made by a state agency. Eligible loans include but aren’t limited to:
- Stafford Loans
- Perkins Loans
- Direct Loans
- Direct Consolidation Loans
- HEAL Loans
- HPSL Loans
You can qualify for an award to pay back these loans if you work just 100 hours with AmeriCorps over the year. But the amount of funding you receive to put towards loans will vary based on the level of commitment made to your volunteer work. Work with AmeriCorps NCCC, AmeriCorps State and National, and AmeriCorps VISTA all qualify you for the award.
If you volunteer in an approved national service position from October 1, 2019 to September 30, 2020, you could receive:
- $348.64 for 100 or more hours of volunteer service as an AmeriCorps Affiliate
- $1,311.11 if you commit at least 300 hours as a Minimal-Time and/or Summer Associate volunteer
- $1,638.89 after volunteering at least 450 as a quarter-time volunteer
- $2,360 for doing 674 hours of volunteer work on a reduced half-time schedule
- $3,097.50 for 900 hours of half-time service
- $4,336.50 for at least 1,200 hours of three-quarter-time volunteer work
- $6,195.00 if you are a full-time volunteer and put in a minimum of 1,700 hours.
The maximum award you could receive for full-time volunteer work is the amount of the Pell Grant each year, so these limits are subject to change. Once you’ve met your volunteer requirement and earned a reward, however, your reward amount is guaranteed.
Explore your options for loan forgiveness
While student loan debt is a major financial burden, you shouldn’t let your loan balance prevent you from giving back to your community. Just be sure to research your options to find out about volunteer opportunities that provide help with loan repayment so you can keep on top of debt payback while doing some good for the world.
Read our other guides for student loan forgiveness:
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