A Temporary Student Loan Forgiveness Waiver Is Ending Soon: Are You Eligible?
(NEXSTAR) – In the fall of 2021, the Public Service Loan Forgiveness Program was revised by the Biden administration. Since then, thousands of borrowers have received $8.1 billion in student debt relief.
But many others who are eligible for the program under a temporary waiver no longer have time to apply for loan forgiveness.
The Public Service Loan Dispensation Program or PSLF, was founded in 2007 with the intention of helping employees of non-profit organizations and government agencies by forgiving their student loans after 10 years of payments (120 payments in total). The approval rating among applicants was low overall — according to a September 2021 report, just 1 in 5 of the 1.3 million borrowers seeking debt relief through PSLF was on track to see relief by 2026 The Washington Post.
In 2021, the US Department of Education announced an amendment that temporarily waives certain PSLF requirements to provide foreclosure credit to borrowers, regardless of their federal loan type or if they have been placed on a specific payment schedule, as long as they previously consolidate their debt have the end of the waiver.
Before the waiver, borrowers had to have a specific federal loan — a direct loan — to qualify for PSLF. Borrowers were able to consolidate their debt into PSLF direct loans, but any payments made on the loans prior to consolidation did not count towards the required amount.
This waiver currently expires after October 31, 2022, meaning eligible borrowers only have about four months to apply. Richard Cordray, head of Federal Student Aid, said at a conference Earlier this week that President Biden, while pushing for an extension of the PSLF waiver, may lack executive authority to authorize such a move.
A recent report from the Student Borrower Protection Center Over nine million public sector workers are likely to qualify for debt relief through the PSLF program but have yet to submit the paperwork to start the process. California, Texas, Florida and New York have the most government employees with student loan debt. according to SBPC.
As explained above, PSLF is designed to grant debt relief to eligible government employees after a certain number of payments have been made.
Eligible Borrowers got to:
- Employed by a U.S. federal, state, local, or tribal government or non-profit organization (federal service includes U.S. military service)
- Working full-time for this agency or organization
- Do you have direct loans (or consolidate other federal student loans into one direct loan)
- Make 120 qualifying payments
Under the current PSLF waiver, eligible borrowers may receive credit for payments made on other types of loans under any payment schedule before consolidation or after the due date. Those who have received a teacher loan waiver may apply for the length of service that led to their eligibility for PSLF if they can certify PSLF employment for that period.
The first step in determining your eligibility is to visit the FSA website and log into your account. You can search for your employer in the FSA’s database and add information about your employment. Once you find your employer, you can see if they qualify under PSLF.
Further acc Walkthrough guide by SBPC, you should determine what type of federal student loan you have. Direct loans are eligible for PSLF while other loans in a. need to be consolidated Direct Consolidation Loan. Through the end of October 2022, previous qualifying payments you made on a nondirect loan will count towards the 120 payments required by PSLF for forgiveness.
After completing the steps above, you will need to confirm your employment. You should then be able to submit your PSLF form.
The FSA created one auxiliary tool to guide borrowers through completing the form.
Who Qualifies for the Already Approved Student Loan Writ?
While widespread student loan forgiveness has yet to materialize, some US borrowers have received some debt forgiveness. About 1.3 million borrowers have experienced $26 billion in student debt relief since the presidency biden taking office.
In addition to the thousands of borrowers who have received debt relief under the revised PSLF program, another 690,000 borrowers had a total of $7.9 billion in student loans wiped out by relief from borrower defenses and school closures. Over 400,000 borrowers have received more than $8.5 billion in debt relief through full and permanent disability relief.
Last month, the biden administration agreed to forgive $6 billion of federal student debt for approximately 200,000 borrowers as part of a proposed class action settlement. Borrowers claim their college cheated them and their applications for relief from the Department of Education have been delayed for years.
Biden is expected announce its plans for more widespread student debt relief in July or August.