Public Service Loan Forgiveness (PSLF) is a federal initiative to reduce the financial burden of student loan debt from individuals who are committed to a career in public service. Forgiveness of the balance of Direct Loans after 120 consecutive monthly payments on an approved repayment plan while working full-time at an approved employer, PSLF will incentivize professionals to embark and continue careers in public service.
Eligibility criteria for PSLF
Borrowers need the following to be qualified for PSLF:
- Qualifying employment: Federal, state, local, or tribal government work; 501(c)(3) tax-exempt organizations; or other non-profit organizations that perform qualifying public services.
- Loan type: Only Direct Loans are eligible for PSLF. Other federal borrowers, such as Federal Family Education Loan (FFEL) Program loans or Perkins Loans, must consolidate them into a Direct Consolidation Loan.
- Repayment plan: Required participation in an income-driven repayment (IDR) plan. IDR plans lower monthly payments according to income and family size, so payments are manageable.
- Payment requirements: 120 qualifying payments must be made.
Those payments must be:
- Full amount due: Payments only in the full amount.
- On time: Payments must arrive within 15 days of the due date.
After October 1, 2007: Only payments made after this date are qualifying.
These payments aren’t always paid consecutively. Forbearance, deferment, or temporary employment by a non-qualifying employer are not permitted but do not reinstate qualifying payment counting.
Read this later: Good news for thousands of students – If you live in Connecticut, you may be eligible for a refund of up to $20,000 with…
What is the monthly payment on a $140,000 Student Loan?
Americans who have until September 15 to receive $5,000 in debt relief – Nearly all applicants may qualify
Who do you contact if you’ve already accepted more loan money than you need?
What will happen to student loans if Trump closes the Department of Education
Can student loans be forgiven for teachers, nurses, or military personnel?
How to apply for PSLF
- Confirm qualifying employment: Check the PSLF Help Tool to confirm whether your employer qualifies. Periodic certification of employment is recommended to stay on track.
- Verify eligible loan types: Double-check your loans are Direct Loans. If not, consolidate them into a Direct Consolidation Loan.
- Enroll in an income-driven repayment plan: Choose an IDR plan from your budget. This is crucial since payments from qualifying plans qualify for PSLF.
- Make 120 qualifying payments: Continue to be employed full-time with a qualifying employer throughout payments.
- Submit PSLF form: Upon reaching 120 qualifying payments, submit the PSLF application. This application must be certified by your employer(s) to ensure employment.
Recent developments and issues
Up to March 2025, things have changed significantly with student loan repayment plans:
- Cancellation of some repayment plans: The Trump administration, following a court order, canceled some income-driven repayment plans requests, with borrowers kept in the dark. The Education Department canceled the plan requests, for individuals who were applying for smaller payments because they had lost employment.
- Legal hurdles for forgiveness programs: President Biden’s SAVE plan, aiming to lower loan burdens, was stopped in its tracks by a federal appeals court, leaving borrowers wondering about the fate of their loan forgiveness.
Advice for borrowers
With the environment changing:
- Stay up to date: Periodically review official websites such as the Federal Student Aid site and converse with your loan servicer to stay updated.
- Document communications: Document all discussions with your loan servicer and any forms filed.
- Seek help: When having difficulties, consider contacting state agencies or legal assistance organizations that work on student loans.
PSLF application requires immense attention and awareness about current developments. Remaining current with the eligibility criteria, strictly adhering to the application process, and remaining current with policy updates places the borrowers in a favorable position so that their loans can be forgiven under PSLF.
