What is Public Service Loan Forgiveness (PSLF)?
Public Service Loan Forgiveness started in 2007 to help talented workers in public service reduce the burden of their federal student loans by forgiving their balance after ten years. While this act was well-intentioned, ten years later, more than 99% of applicants have been rejected - but this doesn’t have to happen to you!
What do you need to do to get forgiveness under PSLF?
The Public Service Loan Forgiveness application requires that you certify you have these five things in place: the correct kind of loans, full-time work at a qualifying employer, are enrolled in an income-driven repayment plan and have made 120 on-time payments, plus submit your PSLF application. Let’s walk through these requirements in a bit more detail:
1. Make sure you have the correct kind of loans
Only federal direct loans are eligible for forgiveness. FFEL loans and private loans are not eligible. However, you can consolidate other federal loans into direct loans.
2. You must work full-time for an eligible employer
This includes government organizations, non-profit organizations, 503(3)(c)s, and a few non-profits that are not 503(3)(c)s, but which provide service in fields like early childhood education. The best way to know for sure if your employer qualifies is by searching for your employer in our employer search located in the Profile section of your Chipper dashboard. If you work at two part-time jobs, don’t fret; if your weekly hours worked at eligible employers add up for 30 hours or more, you can still qualify.
3. Enrollment in an income-driven repayment plan
Most people are automatically enrolled in the standard 10-year repayment plan after they graduate. PSLF, however, requires that your payments be made under an income-driven repayment (IDR) plan. IDR plans include IBR 2009 (Income-Based Repayment for loans taken out between 2009 and July 1, 2014), IBR 2014 (for loans taken out after July 1, 2014), REPAYE (Revised Pay As You Earn), PAYE (Pay As You Earn), and ICR (Income-Contingent Repayment). Learn more about which IDR plan is best for you here.
4. 120 on-time payments
You must make 120 on-time payments (no later than 15 days past the due date) in order to meet this requirement. These payments do not need to be sequential - you can make some of these payments, then move to a non-qualifying employer where your payments don’t count toward PSLF, then go back to working for a qualifying employer, to make more qualifying payments. Note, payments for PSLF can not be made while under deferment, grace period, or any other period when payments aren’t required.
5. Submitting the PSLF application
You'll need to submit the application for PSLF along with the Employment Certification Forms for each employer you've worked for during the last 10 years of your public service. When you are confident that you have made the 120 qualifying payments, submit your request online or with a mailed form. If you haven’t yet submitted any PSLF Employment Certification Forms, you will need to back track to each employer you worked for while you were making qualifying payments. Don't worry though, we can help you submit your application correctly AND help you get your ECFs signed by contacting past employers for you.
What if you don’t qualify for Public Service Loan Forgiveness?
If you applied for PSLF and were one of the 99% that were not accepted, we can help you appeal through the Temporary Expanded Public Service Loan Forgiveness (TEPSLF) program!
There are other options for you beyond PSLF and TEPSLF. There are other federal and state forgiveness programs that may forgive some or all of your loans- for example, the Perkins Loan Cancellation program or the Teacher Loan Forgiveness program. There are also paths toward forgiveness available for borrowers under Income-Driven Repayment (IDR) plans. Be sure to take the time to see which plans and programs are best for you!