Student Loan Forgiveness Options for Arkansas Residents

Katie Taylor Updated: May 1, 2019

Arkansas residents owe more than $10.8 billion in debt, with the average Arkansas college borrower carrying a balance of a little less than $27,000 — slightly less than the national average. Hundreds of thousands of Arkansas residents are actively working to manage their student loans. 

For some, the state provides financial assistance that makes paying off their loans a faster option.  

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Repayment assistance for teachers

Many states run repayment assistance programs for professionals whose services are in need in particular geographic areas. In Arkansas, teachers who agree to work in specific subject matter fields or geographic locations may be eligible to receive financial assistance through the State Teacher Education Program (STEP). 

How the program works

Licensed Arkansas teachers may receive up to $3,000 per year for teaching in:

  • A public school located in an geographic area designated as having a critical shortage of teachers, or
  • A subject matter area designated as having a critical shortage of teachers. 

The program is capped at three years. 

Minority teachers meeting either of the above criteria are eligible to receive an additional $1,000 per year. 

Eligibility requirements

To participate in STEP, a teacher must:

  • Be an Arkansas resident for at least 12 months prior to the application deadline.
  • Be a citizen of the United States or a permanent resident alien.
  • Have graduated from a teacher education program after April 2004.
  • Have outstanding federal student loans.
  • Hold a valid Arkansas teacher's license.
  • Teach full-time at an Arkansas public school district .

Applicants must re-apply each year, for no more than three years.

What loans are eligible

Only federal loans are eligible for the STEP program.

How to apply

The annual application deadline is June 1st. To apply, visit the Arkansas Department of Education website for more information.
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What to do if you don’t qualify for loan forgiveness

If you're not a teacher, don't fret. There are many other ways to manage your student loan debt that could work for you.

Let's check out a few of them.

1. Refinance your loans

When you refinance your student loans with a private lender, you can: (1) reduce your monthly payment and (2) decrease the amount you'll pay over the life of the loan. This double whammy for your bank account is possible because when you refinance, you don't just change your repayment term or reallocate your payments — you lower your interest rate. 

Dropping even a point from your interest rate could save you thousands of dollars. In fact, the average borrower who refinances can lower their payment by $258 per month or save more than $16,000 over the life of their loan. 

2. Apply for federal grants or forgiveness programs

If Arkansas's forgiveness program doesn't apply to you, you may be able to seek forgiveness for your student loans through the federal government. Check out our ultimate list of grants to pay off your student loans to find a program that could benefit you.

The most well-known federal forgiveness option is the Public Service Loan Forgiveness program. Participants can get their student loans discharged after 10 years working for an eligible non-profit organization or government agency. Because this program focuses on public service rather than specific industries, any career path could be eligible as long as it involves public service.

3. Sign up for an income-driven repayment plan

Applying for an income-driven repayment (IDR) plan could save you money each month, and if you have federal loans, you're eligible. Monthly payments under an IDR plan are capped at an amount between 10% and 20% of your discretionary income.

See: Discretionary Income: Why It Matters for Student Loans

Before you apply, use our calculator to determine what your payments would be under an income-based repayment plan — sometimes getting on an IDR plan could actually increase your payments, depending on your income. 

If the Arkansas forgiveness programs aren't in your future, find out how much you could save by refinancing your student loans. 

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