Q: What is Public Service Loan Forgiveness?

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Stanley tate

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Looking for a straightforward, simple answer on how to get student loan forgiveness for public service? Well, you’re in luck.

Simply put, as a public servant, you can get your loans forgiven under the Public Service Loan Forgiveness program if you meet the program requirements, which are:

  1. You must do eligible work, for the government or most any nonprofit.
  2. You must work full-time.
  3. You must have an eligible loan, specifically a Direct Loan
  4. You must make 120 monthly payments on time, in full. (Never pay more. That will trip you up.)
  5. You must be using an eligible repayment plan, usually an income-based repayment plan (REPAYE, PAYE, IBR, or ICR).

Simple, right?

The pool of Americans who qualify for the PSLF program is huge. Almost a quarter of all jobs qualify. And about two-thirds of college graduates borrowed student loans to complete their degrees.

Still, even to this day, over a decade after the birth of this student loan forgiveness program, many student loan borrowers are unsure of how the program works and how to sign up.

That stops here — at least for you.

In this post, you’ll get a step-by-step breakdown of the Public Service Loan Forgiveness program requirements.

This way, you can keep working in the public sector and not worry about your massive student loan debt.

1. What is Public Service Loan Forgiveness

The Public Service Loan Forgiveness program was introduced in 2007 while President George W. Bush was in office.

The program’s purpose is to encourage student borrowers to work full-time as public servants in high-need jobs (teachers, social workers, police officers, etc.) and areas by offering to forgive some of their federal student loans.

The PSLF program has five requirements:

  1. You must have the right loans
  2. You must have the right employer
  3. You must work the right number of hours
  4. You must make 120 monthly payments
  5. You must make those payments under the right repayment plan.

1.1 What loans qualify for forgiveness

The PSLF program only forgives loans made under the Direct Loan Program.

Private loans don't qualify.

And other U.S. Department of Education loans (FFEL, Perkins, etc.) don't qualify.

There is a workaround, however.

If you consolidate your non‑Direct Loan Program loans into a Direct Consolidation Loan, the resulting consolidated loan will qualify for forgiveness. That forgiveness is contingent, however, on you making the 120 qualifying payments.

You can find out what types of loans you have by checking the National Student Loan Data System.

To find out more about consolidating your loans, you can visit studentloans.gov.

2. Guidelines for Student Loan Forgiveness for Public Service

You must make 120 payments to have your loans forgiven under the program.

Those payments must be made:

While you were working full-time for a qualifying public service organization

  • On-time
  • In full
  • As scheduled
  • On a monthly basis
  • Under a qualifying repayment plan

2.1 What counts as full‑time employment?

Generally, full‑time employment must (a) be at least an average of 30 hours per week and (b) meet your employer’s definition of full‑time.

There are two exceptions, however.

First, if you’re a teacher and you’re under contract for at least eight months a year, you’re full time so long as:

  • you worked an average of at least 30 hours per week during the contractual period; and
  • your employer credited you for a full year’s worth of employment.

Second, if you’re employed in more than one qualifying part‑time at the same time, you may meet the full‑time employment requirement. You just need to work a combined average of at least 30 hours per week with your employers.

2.2 What organizations qualify as a public service organization?

The Education Department defines a qualifying public service organization as one that’s either:

  • A government organization (federal or state);
  • A not‑for‑profit, tax-exempt organization under § 501(c)(3) of the IRS code; or
  • A private, nonprofit organization (but not a labor union or partisan political organization) that provides one or more of these services:
  • Emergency management
  • Military service
  • Public safety
  • Law enforcement
  • Public interest law services
  • Early childhood education
  • Public service for the elderly and people with disabilities
  • Public health
  • Public library services
  • School library

Click here to learn What jobs qualify for Public Service Loan Forgiveness?

2.3 What are timely payments?

Timely payments are those that your federal loan servicer receives no later than 15 days after the payment becomes due.

2.4 What are full payments?

Full payments are loan payments you make that equal or exceeds the amount you’re required to pay each month under your Direct Loan repayment schedule.

2.5 What are scheduled payments?

Scheduled payments are payments you make after your student loan servicers have billed you for the month’s payment.

Any payment that you make while your loans are in a grace period or in‑school status or in a deferment or forbearance period doesn’t count.

2.6 What payments count as monthly payments?

You must make monthly payments.

Generally, lump-sum payments don’t count.

An exception exists, however, if you work for AmeriCorps or the Peace Corps.

2.7 What’s a qualifying repayment plan?

Here are the repayment plans that count for the Public Service program:

  • The Income-Based Repayment Plan;
  • The Pay As You Earn Repayment Plan;
  • The Income Contingent Repayment Plan;
  • The 10‑Year Standard Repayment Plan; and
  • Any other repayment plan where your monthly payment amount equals or exceeds what you would pay under the 10‑year plan.

Click here to learn How to Complete the Income-Driven Repayment Application

3. Complete the Employment Certification Form Annually

Although not required, you should submit the Employment Certification form each year. This way you have multiple receipts showing you’ve worked at a PSLF eligible employer during your 120 months.

Here’s how you do that:

First, download the application, complete it using blue or black ink, and get your employer’s certification.

Download: PSLF Employment Certification Form

Usually, your employer will have an authorized official that’s responsible for certifying your employment.

If your employer doesn’t have that official, check the box stating that and complete Sections 1, 2, and 3 of the form.

Second, submit the form to FedLoan Servicing.

Finally, wait for FedLoan Servicing to review your form, checking to see if it’s complete and if your employment qualifies for the Public Service Program.

Once FedLoan Servicing finishes its review and confirms your application is correct, it will notify you of:

The number of qualifying payments you’ve made while employed at a qualifying public service organization; an

The remaining number of payments you must make before you are eligible to apply for forgiveness.

Click here to learn How to Get Student Loan Forgiveness After 10 Years

3.1 What happens if there are issues with your application

If FedLoan Servicing determines your application is incomplete or your employer doesn’t qualify, you’ll have a chance to correct the application or provide more information.

Typically that information will include your W‑2, your pay stubs, or other documents from your employer showing that your employment qualifies for the Public Service Program.

4. How to Apply for Public Service Loan Forgiveness

So you’ve made your 10 years of payments and now you’re ready to have your loan balance forgiven.

All that’s left is for you to download the PSLF Application for Forgiveness and submit it to FedLoan Servicing.

From there, you’ll be waiting for the Higher Education Department to process your application.

While you wait, keep working full-time at your qualifying employer.

The PSLF guidelines require you to keep working until your loans are forgiven.

5. Temporary Expanded Public Service Loan Forgiveness

Looking for help because your Public Service Loan Forgiveness application was denied for being in the wrong repayment plan?

You may be in luck.

Last March, Congress, as part of the Consolidated Appropriations Act, 2018, set aside $350 million for student loan borrowers like you. The program is called the Temporary Expanded Public Service Loan Forgiveness Program.

The budget requires the U.S. Department of Education to reach out to student loan borrowers and develop a simple way for them to apply.

That way?

Email TEPSLF@myfedloan.org with your name, DOB, and a request that the Education Department reconsider your eligiblity for public service loan forgiveness.

If you haven’t done so already, you need to apply for TEPSLF right away.

Loan forgiveness will occur on a first-come, first-served basis.

And once the $350 million is gone, that’s it.

To apply for TEPSLF, you'll email TEPSLF@myfedloan.org with your name, date of birth, and a request that your PSLF application is reconsidered because you do meet the program requirements.

So far, according to a presentation made by an employee of the Education Department, over 33 thousand student loan borrowers have requested forgiveness under the temporary program.

And of those 33 thousand, how many have had their requests granted?

26.

There are still over 3 thousand applications under review as of mid-October 2018.

If you’re wondering how long does it take for TEPSLF consideration?

I can’t say for sure.

Anecdotal evidence suggests it takes about 6 months.

6. The Trump Administration and The End of Public Service Loan Forgiveness

Wondering is Public Service Loan Forgiveness going away?

It’s possible.

In the 2018 Budget Request, President Trump’s administration proposed to end the PSLF program.

President Trump announces budget to end PSLF program

The 2019 Budget Request echoed that desire.

The reasoning?

To, and I quote, “eliminat[e] inefficient subsidies to help put the Nation on a more sustainable fiscal path and prioritize expedited debt relief for undergraduate borrowers” and to “establish[ ] reforms to guarantee that all borrowers in IDR pay an equitable share of their income”.

Despite the talk, the PSLF program is safe.

For now.

The future will bring change.

What that change looks like, who knows.

You could be grandfathered in. Or you could be stuck with a much larger bill than you were expecting.

Final Thoughts

If you’re having issues with your servicer and the PSLF program, you have two options.

First, file a complaint with your representatives in the Senate and in the House.

Second, contact the ombudsman at the U.S. Department of Education.


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