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Public Service Loan Forgiveness: Qualify, Learn More

Megan Bradford

So, what is Public Service Loan Forgiveness?

Good news! If you are employed by a non-profit organization or the government, you could be eligible to have your student loans forgiven through the Public Service Loan Forgiveness program. This includes educational institutions.

Your PSLF Checklist:

Having your loans forgiven sounds pretty nice, right? Ensure that you receive PSLF by checking off these 5 mandatory requirements:

1. Do you have qualifying employment?

It’s important to make sure your place of employment is actually eligible for PSLF. If you work full-time for the below organizations, you are good to go:

  • Government organizations at the local, state, tribal or federal level
  • Tax exempt not-for-profits under Section 501(c)(3) of the Internal Revenue Code
  • AmeriCorps or Peace Corps
  • Other not-for-profit organizations that are not tax-exempt under Section 502(c)(3) of the Internal Revenue Code, so long as the org provides at least one of the following services:
    • Emergency management
    • Military service
    • Public safety
    • Law enforcement
    • Public interest law services
    • Early childhood education
    • Public service for individuals with disabilities
    • Public service for the elderly
    • Public health
    • Public education
    • Public library services
    • Other school-based services

 

IMPORTANT: Employment under the below organizations are NOT eligible for PSLF:

  • Labor Unions
  • Partisan political organizations
  • For-profit organizations (even for-profit government contractors)

 

The only way to know for sure that your employer qualifies is by submitting an Employment Certification Form. This certification will be required for every employer for which you will claim qualifying payments when you apply for PSLF anyway; it’s simpler to send these in annually.  

2. Do you have the right student loan?

Any nondefaulted Direct loan accepted after 2010 (when the William D. Ford Federal Direct Loan Program was initiated) qualifies for PSLF. Examples of these loans are:

  • Direct Subsidized Loans
  • Unsubsidized Loans
  • Direct PLUS Loans (Parent Plus)
  • Direct Consolidation Loans

If you accepted loans before 2010 under the Federal Family Education Loan (FFEL) program, you can become eligible for PSLF if you consolidate these loans into a Direct Consolidation loan first. Don’t wait; only monthly payments made after consolidating count to the total 120 needed to receive PSLF. 

3. Are you on a qualifying repayment plan?

Any Income-Driven Repayment plan is a qualifying repayment plan. If you are seeking PSLF and are not already on an IDR, you must switch to one to qualify for PSLF.  

Federal loan holders are free to change their repayment plans at any time. See what your monthly payments would be in the Repayment Plan Calculator at the bottom of this article.  

4. Have you made 120 qualifying payments?

120 qualifying payments must be made to your Direct Loans in order for you to receive PSLF. Qualifying payments just mean that they:

  • Were made after October 1st, 2007
  • Under a qualifying repayment plan
  • For the entire amount that was due
  • On time or no later than 15 days after the due date
  • During full-time employment with (an) eligible employer(s)

IMPORTANT: Your payments do NOT qualify if they are made during the below times: 

  • Grace period
  • Deferment 
  • In-school status
  • Forbearance 

This is because payments are only eligible during times when payment is required.

5. Have you applied for PSLF?

Last, but certainly not least, you have to APPLY! You can apply for PSLF after you have completed 120 eligible payments. You will also be required to submit an ECF (Employment Certification Form) for every employer you worked at over the time span in which those 120 qualifying payments were made. Apply for PSLF online, or complete and mail the application for forgiveness and your ECFs to The U.S. Department of Education at:

U.S. Department of Education

FedLoan Servicing

P.O. Box 69184

Harrisburg, PA 17106-9184

Whew! That was a lot…

PSLF is a lengthy process (to say the least) and there is a lot of room for these details to slip through the cracks. If you’re interested in a free tool to check if your student loan(s), repayment plan(s), and employer qualifies for PSLF, you can use this online PSLF calculator.

Here are some pro tips to make sure you stay on track once you’ve gotten your loans and repayment plan in order:

  • Annually: submit an ECF to ensure you’re making qualifying PSLF payments under an eligible employer
  • Annually: log onto your FedLoan Servicing account to view qualifying payments (If you don’t already have an account, you will be assigned one once you’ve submitted an approved ECF form)

What if I don’t qualify for forgiveness?

If you were one of the more than 99% of applicants rejected for PSLF who made 120 payments that you thought were eligible for forgiveness, you can apply for reconsideration through the Temporary Expanded Public Service Loan Forgiveness (TEPSLF) opportunity. 

If PSLF or TEPSLF are not options for you, know that you can reduce your student loan payments and even receive forgiveness through income-driven repayment plans (IDRs) on your student loans. There are also many job-specific and region-specific forgiveness programs; few people know this– but now you do. Do your research, and see what’s right for you- it may prove worth your time.