Do Stafford Loans Qualify for PSLF? Yes, Here's How

Stafford Loans qualify for PSLF, but not automatically. They must be consolidated into a Direct Loan before being eligible for forgiveness.

During the pandemic, the federal government temporarily simplified the tricky eligibility criteria that blocked many public servants from getting their loans forgiven after a decade of working full-time for the government or a nonprofit organization. The changes have allowed tens of thousands of active duty military service members, teachers, police officers, and others to qualify for the Public Service Loan Forgiveness (PSLF) Program — even those who borrowed Stafford Loans.

Related: How the PSLF Temporary Waiver Works

Stafford Loans are a type of federal student loan that the Education Department used to offer undergraduate student loans. The loans were made under the now-defunct Federal Family Education Loan Program.

There are two types of Stafford Loans: Subsidized and Unsubsidized Loans. Both types of Stafford Loans qualify for PSLF, but you’ll need to consolidate them into a Direct Consolidation Loan before they can be forgiven.

When you consolidate, you’re usually not allowed to count the monthly payments you made before you consolidated as a qualifying payment for PSLF. But for a limited time, the Biden administration is doing away with that penalty.

If you submit a consolidation on studentaid.gov before midnight on Oct. 31, 2022, you’ll not only get retroactive PSLF credit for those payments, but you’ll also receive credit for some of the time your loans were in forbearance and deferment.

Learn More: What is an FFELP Stafford Subsidized Loan?

Before you apply for Public Service Loan Forgiveness and submit an Employment Certification Form, you must consolidate your FFEL Stafford Loans — and any Federal Perkins Loans you may have — into a Direct Consolidation Loan. You can do that on the Federal Student Aid website, studentaid.gov.

You’ll need to choose MOHELA as your new student loan servicer when you consolidate. MOHELA replaced FedLoan Servicing as the PSLF servicer this summer.

You’ll also be asked to choose one of the income-driven repayment plans to repay your loans. The Revised Pay As You Earn or the income-based repayment plan is typically the best choice unless you borrowed Parent PLUS Loans for a child. In that case, you’ll likely want to choose the income-contingent repayment plan.

You’ll need to do two things to qualify for the benefits the Limited PSLF Waiver offers borrowers:

• Consolidate your FFEL Loans into the Direct Loan Program by midnight on Oct. 31, 2022.

• Generate an Employment Certification Form using the PSLF Help Tool for each of your qualifying employers by that same date. If you print, sign, and have your employer(s) sign the form and then submit it to MOHELA for processing after the deadline passes, you’ll still qualify for the waiver, according to the Education Department.

Related: Do Navient Loans Qualify for PSLF?

The PSLF Program cancels the remaining balance owed on Direct Loans for all student loan borrowers with qualifying public service employment who’ve paid on their loans for at least a decade.

The program’s original rules are complex. Borrowers have to not only work full-time for a nonprofit or government organization, but they also must have Federal Direct Loans and have paid those loans on-time under a qualifying repayment plan. Other types of federal loans can qualify for the program if they’re consolidated, but any payments made towards them before that happens don’t count as qualifying payments. Private student loans can never be eligible for PSLF.

Related: How Do I Know if my Student Loan is Federal or Private?

Last October, the U.S. Department of Education announced that the rules would be relaxed for one year. The new rules would temporarily allow public servants to get retroactive credit towards PSLF for any payment made on their account on any kind of federal student loan and certain periods of deferment and forbearance. Under the Limited PSLF Waiver, the Education Department has granted $10 billion in debt relief.

Federal Stafford Subsidized and Unsubsidized Loans qualify for PSLF, but not until they’re consolidated. If you apply for consolidation by Oct. 31, 2022, the payments you’ve already made towards the loans will count towards PSLF.

Let’s talk if you want help figuring out the best plan for your student loan debt.