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Public Service Loan Forgiveness

Some options for student loan assistance include:

  • Public Service Loan Forgiveness (PSLF)
  • State-based Loan Repayment Assistance Programs (LRAPs)
  • Perkins Loan Cancellation
  • Other special benefits for service members and teachers

 

Public Service Loan Forgiveness (PSLF) is the most inclusive benefit for public service workers with student debt.  AmeriCorps Service counts! In addition, a public service organization is:

  • Any federal, state or local government agency or public school district
  • Any 501(c)3 not-for-profit organization
  • Any other private, non-profit organization that provides “public services” including public health, early childhood organization, public interest law, among others.

 
The jist of it is…

On federal student loans, after 10 years (or 120 on-time monthly payments), any remaining balance is forgiven.

  • Doesn’t have to be continuous (ie 2 years of AC, then 5 years of for profit, then 8 years of non-profit qualifies).
  • AmeriCorps service qualifies but members must have income-based repayment plan (or otherwise making monthly payments) during service.
  • For very low-wage workers, a monthly “payment” can be as low as $0.

 

FAQs

Which loans qualify for PSLF?
All federal Direct Loans qualify (all federal loans since 2010 are Direct loans)

  • FFEL loans, and sometimes Perkins loans, that have been consolidated into federal Direct loans would qualify, but lose eligibility for Perkins Loan Cancellation – consult web site for more info at askcfpb
  • Must be on an income-based repayment plan (including pay as you earn)
     

How do I get on an income-based repayment plan (IBR)?
Enroll in IBR at www.studentloans.gov . The earlier you can enroll in IBR, the better! Also check with your loan servicer initially, then annually to make certain you are on track.

Are there any other steps I need to take?
You and your employer must sign a certification form each year.

I’m not sure I’ll spend 10 years in the public service sector. Is this something I should worry about?
It is recommended that those who are not likely to continue in public service sector should still enroll in IBR plan to maintain possibility of PSLF.

 Does past service count?
Any service after October 1st, 2007 can count retroactively.

How do I get more information?

How does this compare to other repayment plans?
Click on picture for a larger view.

Compare Repayment Options
PAYE = Pay As You Earn, IBR = Income-Based Repayment