It’s been 10 years since the launch of Public Service Loan Forgiveness (PSLF), which means some borrowers can finally have their loans forgiven through the program. For the first time since PSLF’s beginning, the application to have their loans eliminated is now available.
Who qualifies for Public Service Loan Forgiveness?
In 2007, President George W. Bush signed into law a bill that made sweeping changes to the student loan system. One of the most notable changes was the launch of Public Service Loan Forgiveness. Under this new program, the government would forgive the loans of individuals who worked for government agencies or nonprofit organizations after 10 years of service.
There are several criteria you must meet to qualify for PSLF:
- Work for a government agency, a tax-exempt non-profit organization, or a non-exempt non-profit that provides public services.
- Be a full-time worker, meaning your employer classifies you as full-time or you work at least 30 hours a week
- Have federal Direct Loan Program loans; other student loans, including private ones, are not eligible.
- Make 120 qualifying payments while working for a PSLF-eligible employer. Qualifying payments include those made under income-driven repayment (IDR) plans.
Only payments made after October 1, 2007, qualify for PSLF. If you worked for a nonprofit organization or government agency and made payments before that date, they do not count toward loan forgiveness.
Currently, there is no cap on how much can be forgiven by the government if you meet the requirements. Your loans will be eliminated after 10 years of qualifying payments.
There are over 600,000 people enrolled in the PSLF program. Although there may be changes to the PSLF program in the future, any changes would only affect new borrowers. Current borrowers are still eligible for PSLF.
How do I know if I meet Public Service Loan Forgiveness’ eligibility requirements?
If you have worked and made payments since 2007 but just heard of the program, you can still apply and qualify for PSLF.
However, if you want to find out if you are eligible, complete and submit the Employment Certification for PSLF form. You can submit the form annually, or whenever you switch employers. Federal student aid representatives will review your forms and tell you if your employer, payments, and loans qualify for PSLF.
That way, you know where you stand and don’t have any nasty surprises after making 10 years of payments.
If your loan servicer is FedLoan Servicing, you can upload the employer verification form on its website. If you have a different loan servicer, complete the form and mail it to:
U.S. Department of Education
P.O. Box 69184
Harrisburg, PA 17106-9184
How do I apply for PSLF?
If you are one of the borrowers eligible for PSLF this month, here is how the process works.
- If you have not submitted an employer certification form, you must fill one out for each year or for every qualifying employer you had over the past 10 years.
- Next, complete the application and send it to: U.S. Department of Education, FedLoan Servicing, P.O. Box 69184, Harrisburg, PA 17106-9184.
- After you submit your application, the Department of Education will enter your loans into forbearance while they review your application unless you note otherwise on the form.
- The Department of Education might contact your employer to ensure you are still working for them.
- If you are eligible for forgiveness, the amount eliminated under PSLF will be the principal balance and interest that accrued as of your last qualifying payment. Made any extra payments? That money will be sent back to you.
- Finally, you will receive notification of your approval in writing. You do not have to make any more payments. It might take a few weeks to process, but after that, your loan balance is zeroed out.
The very first borrowers will be able to submit their applications for PSLF this month, marking the significant impact this program has on both public service and the loan system.
However, if you do not qualify for PSLF, we have a database of over 120 repayment assistance programs you can use to search for initiatives that apply to you.
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