August 2, 2023

Everything You Need to Know About Public Service Loan Forgiveness (PSLF)


While $14.9 billion worth of student loans have been forgiven through PSLF, that’s only 0.65% of the total federal student debt balance. An estimated 1.35 million people with an average debt owed of $99,063 are eligible for PSLF based on their employee history, and the average amount forgiven per borrower with PSLF is $63,826.

Since November 2020, only 2.5% of applications have been accepted, according to an April 2023 report from international research group Wordsrated. At the end of the previous Administration, only about 7,000 borrowers had been approved for the PSLF program.

So, why haven't more eligible borrower received forgiveness? PSLF changes made by the Biden-Harris Administration have made it possible for more borrowers to qualify for forgiveness, but borrowers are still confused about what to do next. Whether you are trying to determine if you qualify for Public Service Loan Forgiveness (PSLF), or if you are looking to apply, we have put together a comprehensive guide to help you get the forgiveness you deserve.

What is PSLF?

Public Service Loan Forgiveness (PSLF) is a federal program designed to provide relief to borrowers who work in qualifying public service jobs and help them manage their student loan debt. The program was established under the College Cost Reduction and Access Act of 2007 to encourage borrowers to pursue careers in public service.

The PSLF Program offers forgiveness of the remaining balance on your Direct Loans after you make 120 qualifying monthly payments under a qualifying repayment plan while working full-time for a qualifying employer. This usually takes around 10 years to achieve.

Once you have made 120 qualifying payments and submitted ECF forms, you can apply for loan forgiveness in the Chipper app. After successfully making 120 qualifying payments, your remaining loan balance will be forgiven. And good news, this forgiven amount is tax-free, which means you won't owe income tax on the discharged debt!

PSLF Eligibility Breakdown

If you have direct loans and work for a qualifying public organization or non-profit, you can apply for public student loan forgiveness after making 120 qualifying monthly payments. We have broken down the qualification details to help you better understand if PSLF is right for you, along with guidance for how to apply with confidence.

Qualifying Employment

To qualify for PSLF, borrowers must be employed full-time by a public service organization. The specific job title is not relevant, as long as the employer is qualified. For instance, if you work full-time for a public school system, your employment would meet PSLF requirements, regardless of your role (teacher, administrator, staff, etc.).

Qualifying organizations include government agencies (federal, state, and local), non-profit organizations (501(c)(3) tax-exempt organizations)

Here are some of the employer types that qualify:

  • Military Service
  • Public Safety
  • Law Enforcement
  • Emergency Management
  • AmeriCorps
  • Peace Corps
  • Public Elementary and Secondary Schools
  • Public Colleges and Universities
  • Public Early Childhood Education
  • Public Child and Family Service Agencies
  • Special Governmental Districts such as Public Transportation, Water, Bridge District, or Housing Authorities).
  • Public Interest Law Services
  • Public Service for Individuals with Disabilities and the Elderly
  • Public Health
  • Public Library Services

Qualifying Loan Types

To qualify for PSLF, only loans that are part of the federal direct loan program are eligible. Private student loans are not eligible.

Qualifying loan types include:

  • Direct Subsidized Loans
  • Direct Unsubsidized Loans
  • Direct PLUS Loans (for parents and graduate/professional students)
  • Direct Consolidation Loans

Federal Family Education Loan (FFEL) loans and Perkins loans are not eligible, however, you can consolidate them into Direct Loans to be eligible for PSLF.

Consolidation typically entails risks, such as losing credit previously earned towards Public Service Loan Forgiveness (PSLF) and forgiveness available through repayment plans. However, the federal government has waived this penalty through a one-time account adjustment.

Borrowers will receive credit towards loan forgiveness under income-driven repayment (IDR) for all months in repayment, regardless of whether payments were made in full, partially, or were late, or whether borrowers were on a repayment plan. Additionally, borrowers will receive credit for specific periods spent in deferment or forbearance.

Qualifying Payments

Payments while working full-time for a qualifying public service employer qualify towards the 120 required payments. Payments must be made while on a qualifying repayment plan. Qualifying plans include: 

  • Income-Based Repayment (IBR)
  • Pay As You Earn (PAYE)
  • Revised Pay As You Earn (REPAYE), Will Transition to SAVE Plan July 2024
  • Income-Contingent Repayment (ICR

Discover Eligibility

There are many eligibility requirements for PSLF, which can make it difficult to determine your standing. However, it doesn't have to be so complicated. Discover eligibility in minutes with the Chipper PSLF calculator.

Applying for PSLF

You shouldn't wait until you have completed your payments to start the process. Instead, complete your Employer Certification Forms along the way. Verify employer eligibility, complete your forms, gather required employer signatures, track eligible payments and form status to stay on track.

Common Pitfalls for Borrowers Going Towards PSLF

  • Missing or incomplete information on the Employment Certification Form.
  • Not being on a qualifying repayment plan.
  • Making non-qualifying payments (e.g., while in deferment or forbearance).
  • Failing to maintain full-time employment.
  • Submitting the forgiveness application before making 120 qualifying payments.

The Chipper app is the easiest way to ensure a complete, accurate application that will ensure you get the forgiveness you deserve. Your PSLF Checklist makes it easy to complete forms, verify employment, gather employer signatures, track form status, and ensure a complete submission all in one place. Here' how we'll help you apply with confidence.

Step 1: Repayment Assistance

First, we will help you determine if you qualify for a repayment plan. Next, we will assist you in selecting the plan that best fits your needs. With a transparent, side-by-side comparison of Income-Driven Repayment plans that identifies your monthly payments, interest rates, and other details, you can confidently enroll in the plan that offers the lowest monthly payment, maximizing your forgiveness under PSLF.

Step 2: Easy ECF Form Completion and Tracking

For each qualifying employer, you must complete and submit an Employment Certification Form (ECF). We will securely collect your personal information, including your name and address, as well as your employment details for verification purposes. After that, you will need to authorize that you understand the program's workings, eligibility requirements, and that you are on an eligible repayment plan. You will have convenient access to all your forms throughout your repayment journey.

Step 3: Automatic Employer Verification and Signature

After including your information, we will assist you in gathering the necessary verification and signature from your employer. Each form must be submitted to an authorized official who will verify your employment status and sign the form. This authorized official may be someone in Operations or Human Resources, or it could be your manager.

After submitting the PSLF Employment Certification Form, your loans are transferred to MOHELA, the student loan servicer that manages the program. MOHELA reviews your PSLF Employment Certification Form and your employer information to determine how many qualifying payments you have made towards forgiveness.

Use Chipper for Lower Payments

Chipper can help you find a student loan repayment plan that actually fits into your budget. You simply fill out your information and link your student loan account for us to generate your options in seconds. We help the average student loan borrower save over $300 a month off their student loan monthly payment. Lowering your monthly payment plan can game changing for your personal finance and can be done in minutes! Sign up for Chipper today to get on track with your student loans.

Use Chipper for The Best Path to Forgiveness

Finding your path to student loan forgiveness is easier than ever before. Chipper helps members find better Income-Driven Repayment (IDR) plans every day. Once enrolled in an eligible repayment plan, we can help you explore your forgiveness options and understand your path towards forgiveness. Sign up with Chipper today and get on track with your student loans.

Use Chipper for Round-Ups

Paying off your student loans doesn’t have to be a long and painful journey. Round-Ups are a way to directly pay off your loans with your everyday spending! By tracking your linked spending account(s), we will calculate the rounded up amount from each transaction in a week (IE spending $4.28 would add $0.72 to the weekly amount). We then initiate a payment towards your student loan for the weekly amount. Get chipping away on your student loans with Chipper today.

Use Chipper for Public Service Loan Forgiveness (PSLF)

The Public Service Loan Forgiveness (PSLF) program was created to provide relief to borrowers aiding the public sector. Unfortunately, 30% of applicants are denied due to incorrect paperwork. We can help! Chipper was created to solve this issue by assisting borrowers in understanding their options as well as allowing forgiveness eligible users enroll into the best forgiveness program available. Sign up for Chipper today to see your student loan forgiveness options and get the forgiveness you deserve.

Use Chipper for Teacher Loan Forgiveness (TLF)

The Teacher Loan Forgiveness (TLF) program was created to enable teachers working in Title 1 schools to receive student loan forgiveness of up to $17,500 (depending on their teaching subject). Chipper has helped teachers from all over the country qualify for TLF program and can help you get the forgiveness you deserve today. Find out if you qualify for forgiveness in minutes with our employer search tool.

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