Q: Can my student loans be forgiven after 10 years?

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Stanley tate

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Your federal student loans can be forgiven under the Public Service Loan Forgiveness Program after 10 years of monthly payments. You're eligible for the PSLF Program if, among other things, you work full-time for the government or a non-profit organization.

This program is different from the Teacher Loan Forgiveness Program. You don't have to work at a low-income school to qualify. It doesn't matter if you're a public or charter school teacher or if you work in education at all. All that matters is that you work as a public servant or at a non-profit organization.

What the Public Service Loan Forgiveness Program is

The Public Service Loan Forgiveness Program is the 10-year loan forgiveness program you've heard about.

This program offers to forgive your federal student loan balance in exchange for you working 10-years as a public servant.

It doesn't matter what your job title is. You can be a janitor. You can be the chief of police.

What matters is that you work for the government or non-profit and meet a few other requirements.

(Private student loans don't qualify for this program. Private student loan forgiveness doesn't exist.)

BTW. The loan amount forgiven under this program is tax-exempt. The amount forgiven won't be treated as income.

Eligibility requirements for the Public Service Loan Forgiveness Program

You're eligible for student loan forgiveness under the PSLF Program if you meet 5 requirements:

  1. You work for the government or a non-profit organization.
  2. You work full-time
  3. You have Direct Loans
  4. You apply for monthly payments under a qualifying repayment plan
  5. You make 120 qualifying payments under your chosen repayment plan.

Let's break each requirement down.

#1 Employers eligible for the PSLF Program

Your employer is eligible for student loan forgiveness if it is a government entity or a qualified non-profit.

Government entities include the federal government, state government, city government, and municipal government entities.

So if you work for the IRS, your employer qualifies because your employer is the federal government.

Likewise, if you're the mayor of your city or if you're a meter maid, you qualify, because you work for the city government.

As you can see, determining you're eligibility if you work for the government is straight-forward: you're eligible.

Non-profit employers, on the other hand, are a little harder to determine eligibility.

If you work for a 501(c)(3), you're good. Your employer qualifies.

But what if your non-profit isn't a 501(c)(3), then you have to check to make sure your employer offers a public service.

Here's a partial list of qualifying public service:

  • Americorps
  • ​Peace Corps
  • emergency management
  • law enforcement services
  • a public health service agency
  • public interest law

Click here to read List of qualifying employment for Public Service Loan Forgiveness

#2 What's considered full-time employment for 10-year student loan forgiveness?

Under the PSLF program, you're considered full-time if:

  • your employer considers you full-time or
  • you work at least 30 hours per week on average.

But what if you work part-time for two different qualifying employers?

In that case, you're considered full-time if you work a combined average of at least 30 hours per week with all of your public service jobs.

#3 Not all federal loans qualify

As I shared above, only loans made under the Direct Loan Program qualify for PSLF student loan forgiveness.

This requirement is one that I've seen cause a lot of student loan borrowers to have their student loan forgiveness applications denied. They had the wrong type of loans.

If you went to school before 2010, you might have federal student loans that were made under a different repayment program. You may have Federal Family Education Loans (FFEL Stafford Loans) or Federal Perkins Loans. Neither of those loans qualifies for 10-year forgiveness.

Click here to learn How to Get Loan Forgiveness for FFEL Consolidation Loans

To get that student loan debt forgiven, you can consolidate them into a Direct Consolidation Loan.

When you consolidate, choose FedLoan as your loan servicer. FedLoan is the only servicer authorized by the Department of Education to process applications for PSLF.

You can consolidate your loans for free at the U.S. Department of Education's website, studentaid.gov.

Here's a list of Federal Direct Loans that qualify for PSLF:

  • Direct Subsidized Loans
  • Direct Unsubsidized Loans
  • Direct Plus Loans (Graduate Plus and Parent Plus Loans)
  • Direct Consolidation Loans

#4 Choose the right loan repayment plan

Not all repayment plans qualify for PSLF. Only income-driven repayment plans qualify.

Those plans calculate your student loan payments using your discretionary income rather than the amount necessary to pay your student loan debt off over time (e.g., a 10-year Standard Repayment Plan).

Discretionary income is based on your family size and adjusted gross income. Your AGI is typically less than your total taxable income. To find your AGI, check your most recent tax return.

Here are the loan repayment plans that qualify for PSLF:

  • Revised Pay As You Earn (REPAYE)
  • Pay As You Earn (PAYE)
  • Income-Based Repayment (IBR)
  • Income-Contingent Repayment (ICR)

If you're unsure of what repayment plan you're in, call your loan servicer.

#5 Make 120 on-time payments

When we talk about the 10-year student loan forgiveness option, what we're really saying is you can get your student debt forgiven after making 120 monthly payments.

You can't make these payments early.

The rules require you make on-time payments.

And that means you have to make each student loan payment within 15 days of your payment due date.

The easiest way to make sure your payments are made on time is to set your account up on auto-draft.

How to Apply for 10-Year Student Loan Forgiveness

You apply for loan forgiveness after you've made your 120th monthly payment.

But before you get there, you should complete the PSLF Employment Certification Form each year you submit your IDR Certification Form.

You don't have to do this, but completing the form each year gives you a record that you worked full-time in a public service job. Basically, it's evidence that you've met the requirements year after year.

Okay, back to applying to have your remaining balance forgiven after 120 payments.

Here's how to apply:

  1. Download the Public Service Loan Forgiveness Application for Forgiveness
  2. Complete page 1 and sign and date the form
  3. Give the application to your HR Department to complete page 2
  4. Submit the application to your loan servicer (FedLoan)
  5. Keep making your monthly payments until your application is approved.
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I'm a student loan lawyer that helps people like you with their federal and private student loans wherever they live.

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