In 2007, Congress passed the College Cost Reduction and Access Act. Included in this bipartisan act aimed to ease the burden of student loan debt was the Public Service Loan Forgiveness (PSLF) program.
Delays And Denials
A lack of clear guidance led to a slow implementation of PSLF. It would take five years for the Department of Education to create the Employer Certification Form, allowing applicants to determine if past or current employers made them eligible for the program. Fast forward another five years when the first wave of applicants became eligible, and a 99% denial rate pointed to major flaws in the oversight of the program. The Department of Education created the PSLF Help Tool to help streamline the process and make it more user friendly.
Who’s Eligible
If you are employed full-time by a government or not-for-profit organization could qualify you for the PSLF program. You must also have made 120 qualifying payments on your federal student loan under an accepted repayment plan.
How To Apply
- Verify that your employer is in the PSLF employer database.
- If your employer is not in the database, request that their eligibility be reviewed.
- Electronically complete your PSLF and request certification and signature from your employer.
- Manually sign and submit your completed PSLF form.
The Requirements
- Employment by a U.S. federal, state, local, or tribal government, or a qualifying not-for-profit organization
- You must work full-time (a weekly average of at least 30 hours)
- Have a Direct Loan or other federal student loans consolidated into a Direct Loan
- Repay loans under an income-driven or 10-year Standard Repayment Plan
- Complete 120 qualifying monthly payments (they don’t need to be consecutive)
Keep in mind that your employer determines your eligibility, not the job you perform for them. Also, the months during which student loan payments were suspended by the CARES Act during the COVID-19 pandemic still count toward your 120 qualifying monthly payments.
Current Success And Future Outlook
More than 1 million public service workers have seen their student loan debt forgiven under the PSLF. Recently, it was announced that an additional 4.5 billion had been cleared from the books, benefitting roughly 60 thousand local, state, federal, and tribal employees. While a change in administration may cast uncertainty on some loan forgiveness programs, any repeal of the PSLF would require an act of Congress.
For more information, visit: https://studentaid.gov/manage-loans/forgiveness-cancellation/public-service
