Big Changes in Public Service Loan Forgiveness Announced
An overhaul of the broken federal Public Service Loan Forgiveness Program (PSLF) announced on Wednesday is meant to restore the promise made to educators and other public service employees who have suffered under the program’s 98% rejection rate.
Changes include a limited one-year waiver that allows all payments by student borrowers to count toward PSLF, regardless of loan program or payment plan, a move to address complaints by NEA and other groups that the program has been overly complicated with labyrinthine rules.
The program is meant to forgive remaining student debt for educators and others who complete 10 years of public service and 10 years of payments on student loans, but many who believed they were making qualifying payments for years discovered their type of loan did not qualify.
“Borrowers who devote a decade of their lives to public service should be able to rely on the promise of Public Service Loan Forgiveness,” U.S. Education Secretary Miguel Cardona said in a press release Wednesday. “The system has not delivered on that promise to date, but that is about to change for many borrowers who have served their communities and their country.”
The actions by the U.S. Education Department come on the heels of a first-of-its-kind report by NEA, “Student Loan Debt Among Educators: A National Crisis,” along with work by a coalition of public sector labor unions calling on the Biden administration to address problems in the program.
Under the limited-time waiver, borrowers who currently have FFEL, Perkins, or other non-Direct Loans, will get the benefit of this limited waiver if they apply to consolidate into the Direct Loan program and submit a PSLF form by October 31, 2022.
The Department estimates that over 550,000 borrowers who have previously consolidated will see an increase in qualifying payments with the average borrower receiving another two years of progress toward forgiveness.
“Teachers, nurses, first responders, servicemembers, and so many public service workers have had our back especially amid the challenges of the pandemic,” Cardona said. “Today, the Biden Administration is showing that we have their backs, too.”
In addition to the waiver, borrowers who have had PSLF applications rejected for errors can have determinations reconsidered. “These actions will help identify and address servicing errors or other issues that have prevented borrowers from getting the PSLF credit they deserve,” the department said.
How do I get on the list? I have applied for forgiveness 2 times. Still waiting for someone to look at payments made to count.
What about those of us who do not qualify because of this rule?
You must not have had an outstanding balance on Direct Loans or Federal Family Education Loan (FFEL) Program loans as of Oct. 1, 1998, or on the date that you obtained a Direct Loan or FFEL Program loan after Oct. 1, 1998.
They say my loans were consolidated and fail to meet this rule. Will they change this?
About time, how can we include behavioral health services providers to the list? In addition to Social Workers, Counselors and Psychologist, what about professionals who work with children who have special needs and require related services. Does the waiver include those seeking to join the following professions I mentioned above?
I completed my MA in 2000. Since that time I have paying on my student loans and at several points prior to 2010, because of desperate financial issues, I got behind. It has been a confusing mess. The last several years after loan service-er switches, I was moved to Navient. I have been trying all week to get into my account so that I could set up my October payment. (I hate paying their late fees.). I am unable to access the account. I am still teaching in the Lansing School District where I have been employed since August of 2001 and I will turn 70 on 10/11. For most of that time I have taught either in the ‘alternative middle school’ program or reading intervention. I was told I missed the date window for qualifying for loan forgiveness by about 1 year. I have two questions. (1) Are the issues discussed in this news letter connected with my inability to access my loan through Navient so that I can make my October payment – due on 10/19? (2) Is there a chance that the changes being discussed in this news letter mean that I will now qualify for some kind student debt relief? If so, what my next step?
This doesn’t seem like that big of a deal to be honest – not much of a change. How about we forgive the loans WAY earlier than 10 years? What about those who have been in default? Just forgive them instead of making everyone jump through hoops!