TEACH Grant - Potential Repayment Obligation
- What happens if I do not fulfill my teaching obligation?
IMPORTANT: If you do not complete the required teaching obligation, the TEACH Grant funds you received will be converted into a Federal Direct Unsubsidized Loan that you must repay. This loan cannot be converted back to a grant, and you will be responsible to pay all interest that will have accrued from the date of each of your original TEACH Grant disbursements. The current interest rate for a Federal Direct Unsubsidized Loan is 6.8%.
- What will happen if I can not complete my service agreement?
Conditions that may preclude students from completing their TEACH Grant obligation vary by state and are determined by each state's teacher certification requirements. If you are unable to complete your service it is important to note that your TEACH Grant will be converted into a Federal Direct Unsubsidized Loan. You will be responsible for repaying this loan along with all accrued interest from the time your original TEACH Grant was disbursed.
- Are there any other circumstances in which my grant will be converted to a loan?
Yes, aside from not completing your teaching requirement, your grant will become a loan after your six month grace period if: • You, regardless of enrollment status, request the conversion. • You fail to notify the Department -- within 120 days of ceasing enrollment -- that you are employed as a full-time teacher in accordance with the Agreement to Serve, or that you intend to pursue such employment. Also, you grant can become a loan if •Within one year of ceasing enrollment without completing the program: *You have not been determined eligible for a suspension. *You have not re-enrolled in a TEACH-Grant eligible program. *You have not begun teaching service in accordance with the Agreement to Serve. Finally, your grant can also become a loan if: You complete the course of study and – * Do not actively confirm to the Department, at least annually, your intention to satisfy the Agreement to Serve. Or * Fail to begin or maintain qualified employment within a time frame that would allow you to complete teaching service. It is important to understand that once your grant is converted into a loan it can not be converted back to a grant.
- If my grant is converted into a loan, what will my monthly payments be?
Your monthly repayment amounts will vary depending on the total amount of your loans. The following repayment chart will provide you with some repayment examples.
- Are there any circumstances in which my teaching obligation may be discharged?
A TEACH Grant obligation may be discharged if the recipient dies, or becomes totally and permanently disabled AND meets the requirements for a total and permanent disability discharge.
- Are there any circumstances in which I can suspend my service obligation without my grant being converted to a loan?
In certain cases, you may be able to temporarily suspend the eight-year time period for completing your teaching service obligation. If you completed the academic program for which you received a TEACH Grant, or you are otherwise no longer enrolled in the program, you may request a suspension of the eight-year period for completing your service obligation based on: • Your enrollment in a program of study for which you would be eligible to receive a TEACH Grant, or your enrollment in a program (including an alternative teacher certification program) that has been determined by a state to satisfy the requirements for certification to teach in the state’s elementary or secondary school; • A condition covered under the FMLA; • Being called or ordered to active duty status for more than 30 days as a member of a reserve component of the Armed Forces named in 10 U.S.C. 10101 or service as a member of the National Guard on full-time National Guard duty, as defined in 10 U.S.C. 101(d)(5), under a call to active service in connection with a war, military operation, or a national emergency. The conditions listed above are the only conditions under which you may receive a suspension of the eight-year period for completing your service obligation. For additional information on TEACH Grant suspension, please review the Department of Education’s Fact Sheet. https://teach-ats.ed.gov/ats/factsheet.action