Upon completion of the doctorate, loan forgiveness is available to CDIP fellows with loans in good standing who obtain instructional faculty appointments within the CSU.
What Do I Need to Know about the CDIP Loan?
CDIP loans are private institutional loans, with particular terms that differ from federally-backed loans for either undergraduate or graduate study. An important way in which CDIP loans differ from some federally-backed loans is the conditions under which they can be forgiven. To qualify for loan forgiveness, CDIP Fellows must meet two conditions:
- They must complete their doctoral programs and earn their doctoral degree.
- They must enter into or continue employment as instructional faculty in a stateside academic degree programs at a CSU.
If these two conditions are met, forgiveness is granted over time at a rate of 20% per year for full-time employment as instructional faculty or 10% per year for part-time employment as instructional faculty. Forgiveness cannot be granted for employment as instructional faculty in the CSU prior to or during participation in CDIP. And it is not automatic: Fellows have to notify CDIP that they have secured faculty appointments, and they have to agree to the terms of forgiveness.
It is important to note that CSU faculty appointments are the only employment that qualifies CDIP loans for forgiveness. CDIP loans are drawn from a fund established by the California State University to support the education of doctoral students with an interest in teaching at a campus of the California State University. Sums borrowed from the fund can be forgiven if, and only if, borrowers enter into or continue employment as instructional faculty in stateside programs at a CSU after earning a doctoral degree. No other kind of public service, and no other kind of employment within the CSU, qualifies a CDIP loan for forgiveness.
Does becoming a CDIP Fellow increase the chances of getting a faculty position in the CSU?
No. While it is our great hope that CDIP Fellows will earn doctorates and return to teach in the CSU, becoming a CDIP Fellow does not increase the chances of securing a faculty job in the CSU. And neither does taking a loan through the CDIP program. Getting a tenure-line appointment in the CSU (or at any higher education institution), depending upon one's discipline and degree, can be very challenging even in good economic times, so we encourage you not to weigh the possibility of forgiveness too heavily. Seek adequate funding from your doctoral institution and explore other sources of funding before applying for this optional loan.
Loan Forgiveness
To qualify for loan forgiveness, CDIP fellows must:
- Earn their doctoral degree.
- Provide CDIP with evidence that the doctoral degree has been obtained.
- Enter into or continue employment as instructional faculty on a CSU campus after earning the doctoral degree.
- Provide CDIP with a copy of a signed contract within two weeks of the date signed.
Participants can receive forgiveness for either full-time teaching or part-time teaching. To qualify to have 20% of the loan forgiven, a Fellow must teach full-time for a full year. In an academic year, full-time means 24 Weighted Teaching Units (WTUs) on a semester-system campus or 36 WTUs on a quarter-system campus. To qualify to have 10% of the loan forgiven, participants must teach at least half-time over the course of a year. Half-time is equal to 12 WTUs on a semester-system campus and to 18 WTUs on a quarter-system campus. The forgiven loan amount, including forgone interest, is reported as imputed income and subject to Federal income tax withholding.
Loan forgiveness is not retroactive. You can contact CDIP at [email protected] to start the forgiveness process.
Loan Forgiveness Statement
Download the Loan Forgiveness Statement(.pdf) for your records. It provides information regarding the eventual Federal tax obligations that ensue when you have earned the doctoral degree and teach at a CSU campus. When you are ready to benefit from the forgiveness provisions of the program, there are significant tax implications that increase your reported annual income and reduce your monthly take-home pay. The Loan Forgiveness Models(.pdf) provide a typical schedule for full-time and part-time forgiveness over 5 years.
To start the loan forgiveness review process, email your degree completion verification and copies of your contract to [email protected]. It is the fellows' responsibility to initiate this process.