How to Qualify for Great Lakes Student Loan Forgiveness

Great Lakes Educational Loan Services, Inc., was a federal student loan servicer that helps borrowers navigate their repayment plans. It's important to note that Nelnet acquired Great Lakes and transferred all loans. According to MyGreatLakes.org, by the end of June 2023, all of the Great Lakes student loans will be transferred to Nelnet. This article will show you how to get forgiveness at your new servicer Nelnet.

What is Great Lakes/Nelnet student loan forgiveness?

Student loan forgiveness is possible through a variety of programs and different plans. Borrowers who meet certain criteria (e.g., working within a specific profession or for a government or nonprofit organization or qualifying for disability discharge) can avoid repaying part of their eligible federal student loans. It's a great way to wipe out some of your student loan debt.

Here’s a closer look at some of the Great Lakes/Nelnet loan forgiveness programs that could be available to you.

Great Lakes/Nelnet income-driven repayment forgiveness

You can apply for an income-driven repayment plan (IDR) to keep your Great Lakes/Nelnet student loan payment at an affordable amount based on your earnings and family size. The federal government offers four income-driven repayment options to student loan borrowers:

• Saving on a Valuable Education (SAVE), formerly called REPAYE
• Pay As You Earn (PAYE)
• Income-Based Repayment (IBR)
• Income-Contingent Repayment (ICR)

To qualify for Great Lakes/Nelnet student loan forgiveness, you’ll need to switch from your current repayment plan to an IDR plan. Under an IDR plan, your monthly payments will be capped at 5% to 20% of your discretionary income for 10, 20 or 25 years. After completing your repayment term, your remaining student loan balance is forgiven (including all unpaid interest and principal).

The caveat, however, is that the forgiven student loan amount is considered taxable income. If you choose to pursue an IDR plan with student loan forgiveness, make sure to prepare for this tax liability to avoid any surprises. For now, though, it's a great way to lower payments.

Check out Student Loan Planner®’s IDR calculator to determine which payment plan makes the most sense for you.

Public Service Loan Forgiveness with Great Lakes/Nelnet

IDR forgiveness is best for people who work in the private sector with a for-profit organization. However, if you work for a nonprofit or government organization, you may be eligible for student loan forgiveness under the Public Service Loan Forgiveness (PSLF) program.

PSLF forgives the remaining balance of your Direct Loans after you’ve:

• Made 120 qualifying payments.
• Made the payments under a qualifying student loan repayment plan.
• Worked full-time for a qualifying employer when you made the 120 payments.

PSLF-qualifying employers include nonprofit 501(c)(3) organizations, such as major academic hospitals, foundations, private, nonprofit universities and the Red Cross. If you work for a local, state or federal government agency, you could also qualify for the PSLF program. 

If you decide you want to apply for PSLF and you qualify, then you need to certify your employment. This will then move your federal loans from Great Lakes/Nelnet student loan servicing to MOHELA immediately.

MOHELA is the only federal student loan servicer that’s set up to track PSLF program payments. To start the process, fill out the PSLF employment certification form. Complete this form annually or when you change employers to track your progress toward PSLF.

After making 120 qualifying payments, submit your Public Service Loan Forgiveness Application.

The IRS doesn't consider amounts forgiven through the PSLF program as taxable income. Therefore, you don't have to pay federal tax on your forgiven outstanding balance.

Great Lakes/Nelnet Teacher Loan Forgiveness

If you teach full-time for five complete, consecutive academic years in a low-income elementary or secondary school or at an educational service agency, you could be eligible for the Teacher Loan Forgiveness program.

This program forgives up to $17,500 on your Direct Loan or FFEL Program loans. Low-income schools and educational service agencies are listed in the Teacher Cancellation Low Income Directory, which the U.S. Department of Education publishes every year.

However, the $17,500 maximum loan forgiveness is only for:

• Highly qualified full-time mathematics or science teachers who taught students at the secondary school level.
• Highly qualified elementary or secondary school special education teachers whose primary responsibility was to teach children with disabilities.

Borrowers who don’t teach math, science or special education could receive up to $5,000 in loan forgiveness. But they must be a highly qualified full-time elementary or secondary school teacher.

You can apply for teacher loan forgiveness once you’ve finished the required five consecutive years of qualifying teaching. You’ll have to submit a Teacher Loan Forgiveness Application to Great Lakes/Nelnet. The chief administrative officer at the school or educational service agency where you worked will have to complete the certification section.

If you have more than one federal student loan servicer, you will need to submit a form to each one. Teacher loan forgiveness is not taxable.

Federal Perkins Loan Cancellation

Great Lakes/Nelnet borrowers could be eligible to have part or all of their Federal Perkins Loan, given by their school based on financial need, canceled depending on their profession or volunteer service. The Perkins Loan Teacher Cancellation also falls under this category.

Federal Perkins Loan Teacher Cancellation

Similarly to the federal Teacher Loan Forgiveness program, borrowers must work at a school that serves students from low-income families to qualify for the Perkins Loan Teacher Cancellation.

Eligible borrowers must work in special education, math, science, foreign language, bilingual education or any field of expertise a state education agency deems to have a shortage of qualified teachers in for that state.

Borrowers can have a portion of their loan canceled for every full academic year (or its equivalent) of full-time teaching service.  An academic year is one complete school year or two half-years that took place during different school years. Those two half-years must be complete and consecutive, however, and typically take place within a 12-month period.

The amount of the Perkins Teacher Loan can be canceled in the following increments for eligible Great Lakes/Nelnet borrowers:

• 15% per year for the first and second years of service.
• 20% for the third and fourth years.
• 30% for the fifth year.

Meanwhile, full-time staff members in the education part of a Head Start program or a state-regulated pre-kindergarten or childcare program are eligible for up to 100% cancellation for seven years of eligible service. Loan cancellation is at a rate of 15% per year for the first six years and 10% for the seventh year.

Other Perkins Loan cancellation eligible professions

Several other professions and services are available that could make you eligible for full or partial Perkins Loan cancellation. But it'll depend on what kind of loan you have and the loan’s disbursement date.

Employees in the following professions are eligible to have 100% of their Perkins Loan canceled within five years of eligible service:

• Employee at a child or family services agency.
• Faculty member at a tribal college or university.
• Firefighter.
• Law enforcement officer.
• Librarian with a master’s degree at a Title I school.
• Military service.
• Nurse or medical technician.
• Professional provider of early intervention (disability) services.
• Public defender.
• Speech pathologist with a master’s degree at a Title I school.

Members of the U.S. armed forces who served in a hostile or imminent danger pay area are also eligible for Perkins Loan cancellation. How much of their Great Lakes loan can be canceled depends on their years of service and when they served:

• Up to 50% for four years (at a rate of 12.5% per year) of eligible service for borrowers whose active duty service ended before August 14, 2008.
• Up to 100% for five years of eligible service for borrowers whose active-duty service includes or began on or after August 14, 2008.

Meanwhile, AmeriCorps VISTA or Peace Corps volunteers are eligible for Perkins Loan cancellation up to 70% for four years. This benefit is at a rate of 15% for the first and second years and 20% for the third and fourth years of eligible service.

Applying for Great Lakes/Nelnet loan forgiveness

Applying for student loan forgiveness can require attention to detail. Be sure to check out all relevant information on the Federal Student Aid (FSA) website and visit StudentAid.gov. You may also get the contact information, like phone number or email, of your loan servicer if you have questions.

Through August 30, 2023, your payment amount is on pause due to the COVID forbearance unless the courts rule sooner on student loan relief. But when things are no longer in deferment/forbearance, you need a plan once the payment pause is done. Between gathering your information and adhering to eligibility requirements, it can get confusing and maybe even stressful. However, you don’t have to do it alone.

Student Loan Planner® has a team of experienced consultants ready to help you through the student loan forgiveness process whether you're in school or graduated. Get in touch with us today for your student loan consult.