Public Service Loan Forgiveness

 

Source: Goodwill Industries International

If you have a federal student loan and work in government or a non-profit, the scariest thing that can happen to you on Halloween is missing out on debt relief via the Public Service Loan Forgiveness (PSLF) limited PSLF waiver. If you haven't already applied for PSLF you must submit a PSLF form and/or consolidate your non-Direct federal student loans by October 31 to get the benefit. The waiver will allow borrowers to gain additional PSLF credit, even if they had been told previously that they had the wrong loan type or the wrong repayment plan. 

You can learn more about the waiver here. Although many of the benefits of the limited waiver will be available after October 31 via recent changes to the PSLF, borrowers are encouraged to apply quickly as possible, particularly if they have benefitted from Teacher Loan Forgiveness or are no longer working at a qualifying employer. 

Borrowers who have not yet taken advantage must take two steps: 

1. Check what loan(s) you have. Federal student loan borrowers who do not have a Direct Loan and want to apply for PSLF should apply for consolidation by October 31, 2022. Borrowers with both Direct Loans and other federal loans should carefully consider the benefits and drawbacks of consolidation. Borrowers seeking the Limited PSLF Waiver benefits should not wait to have their consolidation application approved to move on to the next step. 
2. Borrowers must take one of the following steps by October 31, 2022 to apply for PSLF in time to receive the benefits of the time-limited changes under the Limited PSLF Waiver. Borrowers need only complete one of the steps below for one employer. Additional employment can be certified later. 
   1. Complete an application (known as a "PSLF form") using the PSLF Help Tool by October 31, 2022. Borrowers must generate the form with the requested information and download the completed form (which will be time-stamped) from the PSLF Help Tool for the application to be considered complete. Once the PSLF form is complete, borrowers must sign it, have their employer sign it, and submit it as soon as they can even if it is after the October 31 deadline. PSLF forms completed online by October 31, but not signed by the employer and submitted until after October 31, will still receive the benefits under the Limited PSLF Waiver, if the PSLF form is later approved by the Department. 
   2. Borrowers who complete a PSLF form without using the PSLF Help Tool and submit it after October 31, 2022, will still receive the benefits of the Limited PSLF Waiver if the employer's signature date is no later than October 31, 2022. 

Borrowers who take the necessary steps by October 31, 2022, will see Limited PSLF Waiver benefits update in their accounts as forms are processed after the deadline. Given the volume of applications received, processing time may take months.  The monthly payments credited due to the Limited PSLF Waiver do not expire or disappear simply because the temporary changes end.

The PSLF program and limited waiver are available in addition to the one-time debt relief of up to $20,000 that the Biden-Harris Administration announced in August. Borrowers can apply for both PSLF and one-time debt relief, but they are separate applications. Learn more and apply for one-time relief here. The application is open, but debt discharge is paused because of a court order issued in response to a legal challenge to the program.  Those who apply for one-time debt relief will not need to reapply should the court rule in favor of the Administration.  

Just a few minutes of your time could save you tens of thousands of dollars on your student loans - and reward you for serving the public through your work on behalf of nonprofits.