Over 9 million qualify for the Student Loan Forgiveness Program. Report Finds: Are You Eligible?
(NEXSTAR) – More than nine million Americans may qualify for federal student loan forgiveness under an existing program, according to a new estimate.
The Student Borrower Protection Center has a new report on Thursday, which reviewed government data and found that millions of public sector workers are likely to qualify for debt relief from the Government loan forgiveness program but have yet to submit the paperwork to start the process.
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 forgive their student loans after ten years of payments (120 payments 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 U.S. Department of Education announced an amendment that temporarily waives certain PSLF requirements to provide credit for foreclosure to borrowers, regardless of their federal loan type or whether they were enrolled on a specific payment plan. This waiver currently expires after October 31, 2022.
As of early May 2022, the Federal Student Assistance Office reports that only about 127,000 borrowers have qualified for forgiveness under the limited PSLF waiver.
Of the nine million public sector workers whom the SBPC believes are eligible for forgiveness under the PSLF, fewer than 15% have even submitted paperwork to track their progress toward debt relief. California, Texas, Florida and New York have the most government employees with student loan debt. according to SBPC.
The Department of Education has not yet responded to Nexstar’s request for comment on the SBPC report.
What you should know about qualifying for PSLF
As discussed above, PSLF is intended 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 can credit payments on other loan types, 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.
How to determine if you qualify
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. Some 1.3 million borrowers have experienced $25 billion in student debt relief since President Biden took office.
To date, thousands of borrowers have received $6.8 billion in debt relief “through improvements to PSLF,” according to the Department of Education. Another approximately 690,000 borrowers had their student loans foreclosed due to foreclosures due to borrower defenses and school closures, totaling $7.9 billion. Over 400,000 borrowers have received more than $8.5 billion in debt relief through full and permanent disability relief.
Biden is expected to announce his plans for broader student debt relief in July or August. The Wall Street Journal reported Monday.
WXIN’s Matt Adams contributed to this report.