The Public Service Loan Forgiveness (PSLF) program is a federal initiative designed to help public sector employees by forgiving the remaining balance on their Direct Loans after they have made 120 qualifying monthly payments under a qualifying repayment plan while working full-time for a government or not-for-profit organization.
Key Aspects of the PSLF Program:
- Purpose: To encourage individuals to pursue careers in public service by reducing the burden of student loan debt.
- Eligibility: Borrowers must have federal Direct Loans (not other types like FFEL Program loans, unless consolidated into a Direct Loan). They must also be employed full-time by a U.S. federal, state, local, or tribal government or a not-for-profit organization that is tax-exempt under Section 501(c)(3) of the Internal Revenue Code.
- Qualifying Payments: Payments must be made each year after October 1, 2007, under a qualifying repayment plan (e.g., Income-Driven Repayment plans) while working full-time for an eligible employer. Payments made while a student are not qualifying payments.
- Application Process: Borrowers must submit an annual PSLF Certification Form, which is also used to track progress toward forgiveness. Once 120 qualifying payments are made, the borrower can submit the final PSLF application.
- Changes and Waivers: The program has undergone significant changes and waivers over time, notably the PSLF Waiver (limited-time), which allowed more past payments and loan types to count toward forgiveness. It’s crucial to stay updated on any program adjustments.
How to Apply:
- Confirm Eligibility: Ensure you have Direct Loans and are working for an eligible public service employer.
- Submit the PSLF Certification Form: This form, available on the Federal Student Aid website, is used to certify your employment and track your payments. You can submit it annually or whenever you change employers.
- Make Qualifying Payments: Continue making payments under an income-driven repayment plan or other qualifying plans.
- Apply for PSLF: Once you have made 120 qualifying payments, submit the final PSLF application, which includes employer certification for all periods of qualifying employment.
Sources:
- U.S. Department of Education, Federal Student Aid: https://studentaid.gov/manage-loans/forgiveness-cancellation/public-service