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Thousands of teachers are being forced to pay federal loans they didn't take out: report

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Thousands of teachers who received grant money from the federal government have been told they now have to repay that money with interest, thanks to minor paperwork errors.

For the last decade, the Department of Education has been offering stand-out education students grants of up to $4,000. The idea behind the TEACH grant is to get more good teachers into schools that desperately need them.

The catch? Teachers who receive the grants have to agree to teach an in-demand subject for at least four years at a school that services low-income students. If teachers don't meet the requirements, the grant is converted to a loan, which the teacher has to repay with interest.

According to a new study of the program published by the Department of Education, thousands of teachers had their grants converted to loans despite the fact that they are meeting the grant program requirements.

"If you are somebody looking at the TEACH grant now, I would say don't just walk but run screaming from taking advantage of what should be a good opportunity for people trying to do the right thing," said David West, a visual arts teacher in Lexington, South Carolina.

In order to prove they are meeting the program requirements, teachers have to submit forms each year showing they are certified to teach and that they are or intend to complete the requirements.

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West said his grant was converted to a loan after he missed one signature on his paperwork.

West says the Department sent him a notice that his forms were not complete, and if he did not complete them within 30 days his grant would be converted to a loan. The problem, West said, was that the Department sent him the notice two weeks into the 30-day period. By the time he got the forms resubmitted, he had missed the deadline by two days.

"I thought, surely this isn't going to be a problem," West said. "I'm doing the job, I'm doing the work."

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Now, West says he owes the government over $7,000, which he refuses to pay.

"Gosh, if I made a payment to my credit card company or something like that late, I'd get a minor slap on the wrist. I'd get a $40 charge. I wouldn't be told, 'You now owe us, regardless of four years of work, $4,000 plus accrued interest,'" West said.

He's not the only one. According to the federal review of the program, as many as 1 in 3 participants who had their grants converted to loans reported that they already had or expected to complete the requirements for the program. The report estimates that's about 12,000 grant participants.

"The inconsistency of these responses with their administrative status may have been a result of respondents misunderstanding the question in the way the item was worded and structured, misunderstanding the current status of their grant, and/or misunderstanding the grant process and requirements," the report said.

It's not the first time the feds have flagged failures in the system. Back in 2015, the Government Accountability Office released a review of the TEACH grant program and found that more than 2,000 teachers had their grants converted to loans erroneously.

Since then, The Department of Education has been using a new loan service provider, FedLoan.

Masssachussetts Attorney General Maura Healey is already suing FedLoan after hearing complaints from many teachers in the state about the loan service provider, according to NRP.

A senior official from the Education Department's Office of Federal Student Aid told Circa the results of the study are concerning and that the department needs to better understand why so many grant recipients aren't making it through the program.

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The official also urged teachers with disputes about their conversions to go through an official appeals process and said the department had directed FedLoan to thoroughly examine disputed loan conversions.

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West says he has tried to appeal his grant conversion, but the response he got from a woman he spoke to at the department was less than helpful.

"She finally said, 'There is an appeals process, but no one ever wins,'" West said.

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