Federal Child Care Provider Loan Forgiveness Program

New applicants are no longer being accepted for the Federal Child Care Provided Loan Forgiveness Program because no additional funding has been provided.

However, if you had previously been granted forgiveness under the Child Care Provider Loan Forgiveness Program, you will continue to be eligible for renewal of benefits. To obtain the CHILD CARE PROVIDER LOAN FORGIVENESS APPLICATION FOR RENEWAL BENEFITS, please contact the Department of Education's Child Care Provider Loan Forgiveness Processing Unit at 1-888-562-7002.

Definitions

Early childhood education means education in the areas of early childhood education, child care, or any other educational area related to child care that the Department determines appropriate.
Institution of higher education means a public or nonprofit private institution of higher education as defined by the Higher Education Act.
Full-time employment means working as a child care provider in an eligible facility at least 30 hours per week.
Eligible child care facility means a facility, including a home that provides child care services and meets applicable State or local government licensing, approval, or registration requirements.
Child care services means activities and services for the education of children from birth through age five by an individual who has a degree in early childhood education.
Low-income community means a community in which at least 70 percent of the individuals are from families that earn less than 85 percent of the State median household income.
For the purposes of this program, the community comprises the children who receive child care at the facility.
Consecutive years of employment means maintaining full-time employment for successive, uninterrupted 12-month periods.

Eligibility Requirements

To qualify for loan forgiveness under this program, you must not have had an outstanding balance on a Direct or Federal Family Education Loan Program (FFELP) loan as of October 7, 1998, or on the date that you obtained a Direct or FFELP loan after October 7, 1998.
You must have received an associate or bachelor's degree from an institution of higher education in the field of early childhood education.
You must have worked full-time for the two consecutive years preceding the year during which forgiveness is requested as a provider in a child care facility that serves a low-income community. For renewal applicants who received partial forgiveness in 2001, you must have completed the third consecutive year of full time employment in a child care facility that serves a low-income community.
You are not eligible for loan forgiveness if you receive a benefit under subtitle D of title I of the National and Community Service Act of 1990 (AmeriCorps) for the same child care services.

Terms and Conditions

You may receive forgiveness of up to 100% of your eligible loans. Forgiveness is provided on a progressive basis following consecutive years of full-time employment.
Forgiveness is granted in the following increments and includes interest that accrues on the loan.
- 20 percent after completing two consecutive years of qualifying employment
- 20 percent after completing three consecutive years of qualifying employment
- 30 percent after completing four consecutive years of qualifying employment
- 30 percent after completing five consecutive years of qualifying employment
Forgiveness is available on a first-come, first-served basis, contingent upon the availability of funds.
Priority for forgiveness in subsequent years will be given to borrowers who received forgiveness in the preceding year.
If you graduated from an institution of higher education in an area of study other than early childhood education and returned in order to earn a degree in early childhood education, you may only receive forgiveness on eligible loans for two of the years necessary to obtain the degree. Those loans will be forgiven according to the above schedule.
Provided your loan is not in deferment, you are eligible for forbearance during the period in which you are performing your qualifying service. The U. S. Department of Education will notify your lender of your eligibility after reviewing your application.