In October 2021, the U.S. Department of Education announced changes to the Public Service Loan Forgiveness Program (PSLF), adding a temporary period in which borrowers are able to receive credit for payments that did not qualify for this program in the past. With the new changes to the program, over 100,000 borrowers now qualify for loan forgiveness and the Biden administration could potentially forgive up to $6.2 billion in student debt.
You might be wondering what this program even is or who qualifies for loan forgiveness under Public Service Loan Forgiveness. In this article, we’ll dive further into what the PSLF program is, what loans the program covers, what jobs might make you eligible for this program, and how you could potentially apply for this program.
What is Public Service Loan Forgiveness?
The Public Service Loan Forgiveness Program is a government program created under the College Cost Reduction and Access Act of 2007. The goal of the program is to ease the burden of student loan debt on qualified public service workers. It is also a way to encourage graduating students to enter careers that serve the public interest.
How Does Public Service Loan Forgiveness Work?
After making 120 on-time, qualifying, monthly payments on their Direct loans, or 10 years-worth of payments, while working for a qualifying employee, the remainder of a person’s federal student debt balance will be forgiven.
Unfortunately, private loans do not qualify for the program.
What Jobs are Eligible for Public Service Loan Forgiveness?
To qualify for the Public Service Loan Forgiveness Program, you’d have to be employed by a qualifying U.S. federal, state, local, or non-profit organization. Essentially, your job role wouldn’t be what makes you eligible for the program; whoever your employer is determines your qualifications.
Regardless, there are a plethora of full-time public service roles that will make you eligible. Here are a few examples:
- Teacher, staff member, or administrator at a public school
- Employee at a federal, state, or local agency
- Law enforcement officer at the federal, state, or local level
- Military serviceman
- Social worker in a public service agency
- Public health professional such as a doctor, nurse, or administrator
- Employee at a 501(c)(3) tax exempt organization
Volunteering in a full-time role at AmeriCorps or the PeaceCorp also counts as qualifying employment for the program.
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If you want to skip pre-qualification and apply directly with a lender, you can do so by clicking Apply below.
How Do I Apply for the Public Service Loan Forgiveness?
If you believe that you meet all the requirements for eligibility, you should fill out the Public Service Loan Forgiveness (PSLF) & Temporary Expanded PSLF (TEPSLF) Certification and Application annually or when you change employers to ensure that you’re on the right track. The PSLF Help Tool makes it easier to know if you qualify as well as what steps you can take to qualify for the program.
It’s important to keep in mind that the kind of loans that you have matters when applying for the PSLF program. As such, keep in mind that only Direct loans, including Parent PLUS loans and Grad PLUS loans qualify for the program. If you have any Perkins loans, loans issued by your college/university or Federal Family Education Loans (FFEL), you can consolidate them in order to make them eligible for the PSLF program thanks to the new waiver issued on Oct, 6, 2021. Consolidating allows you to combine multiple federal loans into one loan.
However, if you qualify for the Perkins loan forgiveness program, we suggest you move forward with that program and refrain from consolidating that loan, since it requires you to work in any full-time public service role for five years.
Again, private loans do not qualify for the program.
Also, keep in mind that in order to be eligible for the PSLF program, you must make 120 “qualifying” payments. Qualifying means:
- A payment made after Oct. 1, 2007
- Using specific income-based repayment plans
- While employed full-time by a qualifying employer
As such, keep all of this information with you to ensure that you are indeed eligible for the program before applying.
How Much Can Be Forgiven With the Public Service Loan Forgiveness Program?
There’s no set amount that the program forgives. The PSLF program forgives the remaining balance of your Direct loans after making 120 qualifying payments.
How Does COVID Impact the PSLF Program?
The U.S. Department of Education has issued many COVID-19 relief efforts that address the economic impact of the pandemic on students and paying for student loans. Here are a few ways that COVID is impacting the PSLF program.
Student Loan Repayment Pause
In December 2021, the Department of Education extended the student loan repayment pause through May 1, 2022. This means that loan repayments are suspended until that date. At the same time, anybody making payments on their qualifying student loans through May 1 will face a 0% interest rate, allowing them to save money and pay back their loans faster. This wouldn’t be a good idea for those applying for the PSLF as not paying during this period will maximize the amount of debt that you can get forgiven.
Also, if an individual’s federal loans are in default, the Department of Education will stop collections on those loans through May 1.
For those qualifying for Public Service Loan Forgiveness, if you have non-defaulted Direct loans and work full-time for a qualifying employer, you can continue to earn credit toward the program as if you paid regularly, essentially making $0 payments during this period of time. At the same time, if you made any payments during the payment pause period (March 13, 2020 through May 1, 2022), you can get a refund and still earn credit toward the program.
Keep in mind that the Biden administration is considering extending the student loan repayment pause again.
Limited-Time PSLF Waiver
Earlier, we discussed the Department of Education announcing changes in October that allowed borrowers to receive credit for previously ineligible payments as well as the potential impact it may have on borrowers. Let’s talk about what that means.
This change mainly affects anybody with any type of federal loans that didn’t originally qualify for the PSLF, such as FFEL program loans, Perkins loans, or older loans such as the Federally Insured Student Loans or National Defense Student Loans. Anybody who now qualifies for this waiver must consolidate their federal student loans by Oct. 31, 2022 in order to be eligible.
Qualifying payment plans are waived as well, meaning that until Oct. 31, 2022, periods of repayment under any plan count. At the same time, past periods of repayment before consolidation count toward the PSLF program, as well as other periods of repayment that were made late or for less than the amount due.
Individuals that received Teacher Loan Forgiveness are also affected by this waiver. Any period of service that led to eligibility will also count for the PSLF. In the past, those initial five years of full-time teaching couldn’t count for the PSLF, but they will now for a temporary period.
What if I Don’t Qualify for Public Service Loan Forgiveness?
If you meet the requirements but somehow get a notice that you don’t qualify for the PSLF program, don’t give up. The new waiver makes it easier for more borrowers to qualify. Sometimes, because of your employer, you may not be able to apply.
You could potentially find other loan forgiveness programs that you may qualify for. For example, if your school closes while you’re enrolled or soon after you withdraw, you may be eligible for discharge of your student loans.
More resources and programs can be found on the federal student aid website.
Is Public Service Loan Forgiveness Worth It?
If you owe a large amount of student loan debt, this might be something to consider, as it will forgive a large amount of money after making 120 consecutive payments toward your student loan debt. However, 120 payments (or 10 years-worth of payments) is a long time and, over time, your loans will accumulate interest. At the same time, the program has received many complaints, since not many people have been able to receive student loan forgiveness under this program.
On the flip side, because of COVID-19’s impact on the student loan repayment process, it might be beneficial to at least consider this program, especially if you are passionate about public service. The PSLF program is worth it if you are truly invested in public service roles and intend to work in this sector in the long-run. However, deciding to work in public service simply to get debt forgiven under PSLF isn’t the most informed decision, since you won’t be passionate about this role and because, as is, 98% of PSLF applicants have found themselves rejected for forgiveness in the past.
Student loan rates from our partners
Ascent
Ascent’s undergraduate and graduate student loans are funded by Bank of Lake Mills, or DR Bank, each Member FDIC. Loan products may not be available in certain jurisdictions. Certain restrictions, limitations; and terms and conditions may apply. For Ascent Terms and Conditions please visit: www.AscentFunding.com/Ts&Cs. Rates are effective as of 4/1/2024 and reflect an automatic payment discount of either 0.25% (for credit-based loans) OR 1.00% (for undergraduate outcomes-based loans). Automatic Payment Discount is available if the borrower is enrolled in automatic payments from their personal checking account and the amount is successfully withdrawn from the authorized bank account each month. For Ascent rates and repayment examples please visit: AscentFunding.com/Rates. 1% Cash Back Graduation Reward subject to terms and conditions. Cosigned Credit-Based Loan student must meet certain minimum credit criteria. The minimum score required is subject to change and may depend on the credit score of your cosigner. Lowest rates require interest-only payments, the shortest loan term, a cosigner, and are only available for our most creditworthy applicants and cosigners with the highest average credit scores. Actual APR offered may be higher or lower than the repayment examples above, based on the amount of time you spend in school and any grace period you have before repayment begins.
Ascent’s undergraduate and graduate student loans are funded by Bank of Lake Mills, or DR Bank, each Member FDIC. Loan products may not be available in certain jurisdictions. Certain restrictions, limitations; and terms and conditions may apply. For Ascent Terms and Conditions please visit: www.AscentFunding.com/Ts&Cs. Rates are effective as of 4/1/2024 and reflect an automatic payment discount of either 0.25% (for credit-based loans) OR 1.00% (for undergraduate outcomes-based loans). Automatic Payment Discount is available if the borrower is enrolled in automatic payments from their personal checking account and the amount is successfully withdrawn from the authorized bank account each month. For Ascent rates and repayment examples please visit: AscentFunding.com/Rates. 1% Cash Back Graduation Reward subject to terms and conditions. Cosigned Credit-Based Loan student must meet certain minimum credit criteria. The minimum score required is subject to change and may depend on the credit score of your cosigner. Lowest rates require interest-only payments, the shortest loan term, a cosigner, and are only available for our most creditworthy applicants and cosigners with the highest average credit scores. Actual APR offered may be higher or lower than the repayment examples above, based on the amount of time you spend in school and any grace period you have before repayment begins.
LendKey
1 – Terms and Conditions Apply
Loan products, terms, and benefits may be modified or discontinued by participating lenders at any time without notice. Rates displayed are reserved for the most creditworthy consumers who enroll to make automatic monthly payments. Your initial rate will be determined after a review of your application and credit profile. Variable rates may increase after consummation. You must be either a U.S. citizen or Permanent Resident in an eligible state and from an eligible school, and meet the lender’s credit and income requirements to qualify for a loan. Certain membership requirements (including the opening of a share account, a minimum share account deposit, and the payment of any applicable association fees in connection with membership) may apply in the event that an applicant wishes to apply with, and accept a loan offered from, a credit union lender. If you are not a member of the credit union lender, you may apply and become a member during the loan application process if you meet the lender’s eligibility criteria. Applying with a creditworthy cosigner may result in a better chance of loan approval and/or lower interest rate. Loans for exam preparation classes, including, but not limited to, loans for LSAT, MCAT, GMAT, and GRE preparation, are not available via LendKey.com.
2 – Cosigner Release
Some lenders participating on LendKey.com may offer the benefit of cosigner release. Cosigner release is subject to lender approval. In order to qualify, the borrower, alone, must meet the following requirements: (1) Make the required number of consecutive, on-time full principal and interest payments as indicated in the borrower’s credit agreement during the repayment period (excluding interest-only payments) immediately prior to the request. Any period of forbearance will reset the repayment clock; (2) The account cannot be in delinquent status; (3) The borrower must provide proof of income indicating that he/she meets the income requirements and pass a credit review demonstrating that he/she has a satisfactory credit history and the ability to assume full responsibility of loan repayment; (4) No bankruptcies or foreclosures in the last sixty months; and (5) No loan defaults.
3 – Autopay Rate Reduction
Subject to floor rate and may require the automatic payments be made from a checking or savings account with the lender. The rate reduction will be removed and the rate will be increased by 0.25% upon any cancellation or failed collection attempt of the automatic payment and will be suspended during any period of deferment or forbearance. As a result, during the forbearance or suspension period, and/or if the automatic payment is canceled, any increase will take the form of higher payments.
4 – AutoPay Discount & Lowest Interest Rate
Subject to floor rate and may require the automatic payments be made from a checking or savings account with the lender. The rate reduction will be removed and the rate will be increased by 0.25% upon any cancellation or failed collection attempt of the automatic payment and will be suspended during any period of deferment or forbearance. As a result, during the forbearance or suspension period, and/or if the automatic payment is canceled, any increase will take the form of higher payments. The lowest advertised APR is only available for loan terms of 10 years and is reserved for the highest qualified applicants, taking into consideration the applicant’s credit and other factors.
1 – Terms and Conditions Apply
Loan products, terms, and benefits may be modified or discontinued by participating lenders at any time without notice. Rates displayed are reserved for the most creditworthy consumers who enroll to make automatic monthly payments. Your initial rate will be determined after a review of your application and credit profile. Variable rates may increase after consummation. You must be either a U.S. citizen or Permanent Resident in an eligible state and from an eligible school, and meet the lender’s credit and income requirements to qualify for a loan. Certain membership requirements (including the opening of a share account, a minimum share account deposit, and the payment of any applicable association fees in connection with membership) may apply in the event that an applicant wishes to apply with, and accept a loan offered from, a credit union lender. If you are not a member of the credit union lender, you may apply and become a member during the loan application process if you meet the lender’s eligibility criteria. Applying with a creditworthy cosigner may result in a better chance of loan approval and/or lower interest rate. Loans for exam preparation classes, including, but not limited to, loans for LSAT, MCAT, GMAT, and GRE preparation, are not available via LendKey.com.
2 – Cosigner Release
Some lenders participating on LendKey.com may offer the benefit of cosigner release. Cosigner release is subject to lender approval. In order to qualify, the borrower, alone, must meet the following requirements: (1) Make the required number of consecutive, on-time full principal and interest payments as indicated in the borrower’s credit agreement during the repayment period (excluding interest-only payments) immediately prior to the request. Any period of forbearance will reset the repayment clock; (2) The account cannot be in delinquent status; (3) The borrower must provide proof of income indicating that he/she meets the income requirements and pass a credit review demonstrating that he/she has a satisfactory credit history and the ability to assume full responsibility of loan repayment; (4) No bankruptcies or foreclosures in the last sixty months; and (5) No loan defaults.
3 – Autopay Rate Reduction
Subject to floor rate and may require the automatic payments be made from a checking or savings account with the lender. The rate reduction will be removed and the rate will be increased by 0.25% upon any cancellation or failed collection attempt of the automatic payment and will be suspended during any period of deferment or forbearance. As a result, during the forbearance or suspension period, and/or if the automatic payment is canceled, any increase will take the form of higher payments.
4 – AutoPay Discount & Lowest Interest Rate
Subject to floor rate and may require the automatic payments be made from a checking or savings account with the lender. The rate reduction will be removed and the rate will be increased by 0.25% upon any cancellation or failed collection attempt of the automatic payment and will be suspended during any period of deferment or forbearance. As a result, during the forbearance or suspension period, and/or if the automatic payment is canceled, any increase will take the form of higher payments. The lowest advertised APR is only available for loan terms of 10 years and is reserved for the highest qualified applicants, taking into consideration the applicant’s credit and other factors.
Earnest
Auto Pay Discount Disclosure
You can take advantage of the Auto Pay interest rate reduction by setting up and maintaining active and automatic ACH withdrawal of your loan payment. The interest rate reduction for Auto Pay will be available only while your loan is enrolled in Auto Pay. Interest rate incentives for utilizing Auto Pay may not be combined with certain private student loan repayment programs that also offer an interest rate reduction. For multi-party loans, only one party may enroll in Auto Pay.
Student Loan Origination (Private Student Loan) Interest Rate Disclosure
Actual rate and available repayment terms will vary based on your income. Fixed rates range from 4.36% APR to 16.15% APR (excludes 0.25% Auto Pay discount). Variable rates range from 5.87% APR to 16.45% APR (excludes 0.25% Auto Pay discount). Earnest variable interest rate student loan origination loans are based on a publicly available index, the 30-day Average Secured Overnight Financing Rate (SOFR) published by the Federal Reserve Bank of New York. The variable rate is based on the rate published on the 25th day, or the next business day, of the preceding calendar month, rounded to the nearest hundredth of a percent. The rate will not increase more than once per month. Although the rate will vary after you are approved, it will never exceed 36% (the maximum allowable for this loan). Please note, Earnest Private Student Loans are not available in Nevada. Our lowest rates are only available for our most credit qualified borrowers and contain our .25% auto pay discount from a checking or savings account. It is important to note that the 0.25% Auto Pay discount is not available while loan payments are deferred.
Earnest Private Student Loans are made by One American Bank, Member FDIC, or FinWise Bank, Member FDIC. One American Bank, 515 S. Minnesota Ave, Sioux Falls, SD 57104. Finwise Bank, 756 East Winchester, Suite 100, Murray, UT 84107
Earnest loans are serviced by Earnest Operations LLC, 535 Mission St., Suite 1663 San Francisco, CA 94105, NMLS #1204917, with support From Navient Solutions, LLC (NMLS #212430). One American Bank, FinWise Bank, and Earnest LLC and its subsidiaries, including Earnest Operations LLC, are not sponsored by agencies of the United States of America.
© 2024 Earnest LLC. All rights reserved.
Auto Pay Discount Disclosure
You can take advantage of the Auto Pay interest rate reduction by setting up and maintaining active and automatic ACH withdrawal of your loan payment. The interest rate reduction for Auto Pay will be available only while your loan is enrolled in Auto Pay. Interest rate incentives for utilizing Auto Pay may not be combined with certain private student loan repayment programs that also offer an interest rate reduction. For multi-party loans, only one party may enroll in Auto Pay.
Student Loan Origination (Private Student Loan) Interest Rate Disclosure
Actual rate and available repayment terms will vary based on your income. Fixed rates range from 4.36% APR to 16.15% APR (excludes 0.25% Auto Pay discount). Variable rates range from 5.87% APR to 16.45% APR (excludes 0.25% Auto Pay discount). Earnest variable interest rate student loan origination loans are based on a publicly available index, the 30-day Average Secured Overnight Financing Rate (SOFR) published by the Federal Reserve Bank of New York. The variable rate is based on the rate published on the 25th day, or the next business day, of the preceding calendar month, rounded to the nearest hundredth of a percent. The rate will not increase more than once per month. Although the rate will vary after you are approved, it will never exceed 36% (the maximum allowable for this loan). Please note, Earnest Private Student Loans are not available in Nevada. Our lowest rates are only available for our most credit qualified borrowers and contain our .25% auto pay discount from a checking or savings account. It is important to note that the 0.25% Auto Pay discount is not available while loan payments are deferred.
Earnest Private Student Loans are made by One American Bank, Member FDIC, or FinWise Bank, Member FDIC. One American Bank, 515 S. Minnesota Ave, Sioux Falls, SD 57104. Finwise Bank, 756 East Winchester, Suite 100, Murray, UT 84107
Earnest loans are serviced by Earnest Operations LLC, 535 Mission St., Suite 1663 San Francisco, CA 94105, NMLS #1204917, with support From Navient Solutions, LLC (NMLS #212430). One American Bank, FinWise Bank, and Earnest LLC and its subsidiaries, including Earnest Operations LLC, are not sponsored by agencies of the United States of America.
© 2024 Earnest LLC. All rights reserved.
College Ave
College Ave Student Loans products are made available through Firstrust Bank, member FDIC, First Citizens Community Bank, member FDIC, or M.Y. Safra Bank, FSB, member FDIC. All loans are subject to individual approval and adherence to underwriting guidelines. Program restrictions, other terms, and conditions apply.
*The 0.25% auto-pay interest rate reduction applies as long as the borrower or cosigner, if applicable, enrolls in auto-pay and authorizes our loan servicer to automatically deduct your monthly payments from a valid bank account via Automated Clearing House (“ACH”). The rate reduction applies for as long as the monthly payment amount is successfully deducted from the designated bank account and is suspended during periods of forbearance and certain deferments. Variable rates may increase after consummation. $5,000 is the minimum requirement to refinance. The maximum loan amount is $300,000 for those with medical, dental, pharmacy or veterinary doctorate degrees, and $150,000 for all other undergraduate or graduate degrees. Information advertised valid as of 08/25/2022. Variable interest rates may increase after consummation.
This informational repayment example uses typical loan terms for a refi borrower with a Full Principal & Interest Repayment and a 10-year repayment term, has a $40,000 loan and a 5.5% Annual Percentage Rate (“APR”): 120 monthly payments of $434.11 while in the repayment period, for a total amount of payments of $52,092.61. Loans will never have a full principal and interest monthly payment of less than $50. Your actual rates and repayment terms may vary.
This informational repayment example uses typical loan terms for a freshman borrower who selects the Deferred Repayment Option with a 10-year repayment term, has a $10,000 loan that is disbursed in one disbursement and a 8.35% fixed Annual Percentage Rate (“APR”): 120 monthly payments of $179.18 while in the repayment period, for a total amount of payments of $21,501.54. Loans will never have a full principal and interest monthly payment of less than $50. Your actual rates and repayment terms may vary.
Information advertised valid as of 3/07/2024. Variable interest rates may increase after consummation. Approved interest rate will depend on creditworthiness of the applicant(s), lowest advertised rates only available to the most creditworthy applicants and require selection of full principal and interest payments with the shortest available loan term.
College Ave Student Loans products are made available through Firstrust Bank, member FDIC, First Citizens Community Bank, member FDIC, or M.Y. Safra Bank, FSB, member FDIC. All loans are subject to individual approval and adherence to underwriting guidelines. Program restrictions, other terms, and conditions apply.
*The 0.25% auto-pay interest rate reduction applies as long as the borrower or cosigner, if applicable, enrolls in auto-pay and authorizes our loan servicer to automatically deduct your monthly payments from a valid bank account via Automated Clearing House (“ACH”). The rate reduction applies for as long as the monthly payment amount is successfully deducted from the designated bank account and is suspended during periods of forbearance and certain deferments. Variable rates may increase after consummation. $5,000 is the minimum requirement to refinance. The maximum loan amount is $300,000 for those with medical, dental, pharmacy or veterinary doctorate degrees, and $150,000 for all other undergraduate or graduate degrees. Information advertised valid as of 08/25/2022. Variable interest rates may increase after consummation.
This informational repayment example uses typical loan terms for a refi borrower with a Full Principal & Interest Repayment and a 10-year repayment term, has a $40,000 loan and a 5.5% Annual Percentage Rate (“APR”): 120 monthly payments of $434.11 while in the repayment period, for a total amount of payments of $52,092.61. Loans will never have a full principal and interest monthly payment of less than $50. Your actual rates and repayment terms may vary.
This informational repayment example uses typical loan terms for a freshman borrower who selects the Deferred Repayment Option with a 10-year repayment term, has a $10,000 loan that is disbursed in one disbursement and a 8.35% fixed Annual Percentage Rate (“APR”): 120 monthly payments of $179.18 while in the repayment period, for a total amount of payments of $21,501.54. Loans will never have a full principal and interest monthly payment of less than $50. Your actual rates and repayment terms may vary.
Information advertised valid as of 3/07/2024. Variable interest rates may increase after consummation. Approved interest rate will depend on creditworthiness of the applicant(s), lowest advertised rates only available to the most creditworthy applicants and require selection of full principal and interest payments with the shortest available loan term.
Final Thoughts
The Public Service Loan Forgiveness program is a great option for borrowers that are currently working in public service roles or for students that intend to after graduation. However, it’s important to weigh out the pros and cons of the program, whether or not you’re eligible, and the current climate around student loans, before deciding whether or not to go through the 10-year process of qualifying for the program.
As the student loan crisis continues in the middle of the COVID-19 pandemic, there are multiple efforts by the federal government to alleviate the economic burden of student loans. This is definitely a program to consider if you need help paying off your student loans and if you are passionate about public service and making an impact at the federal, state, or local level.