Federal Student Loan Forgiveness Programs
- PSLF discharges student loans after 10 years of full-time employment in public service.
- Government student loans qualify for Public Service Loan Forgiveness.
- Teachers, law enforcement officers, nurses and workers at non-profits qualify.
Government Student Loan Forgiveness Programs at a Glance
If your student loans are federally backed and you work in public service, you may qualify for loan forgiveness.
Student Loan Forgiveness for Public Service
The College Cost Reduction and Access Act of 2007 established the Public Service Loan Forgiveness (PSLF) program. The PSLF discharges any remaining student loan debt after 10 years of full-time employment in public service. Income is not a factor in eligibility.
To apply for the student loan forgiveness program you need to contact the Federal Student Aid Information Center by calling (800) 433-3243, or visit the Dept. of Education Student Aid Web page. To see a detailed outline of the program for public service employees read the document Loan Forgiveness for Public Service Employees. (PDF)
Eligibility Requirements for Public Service Loan Forgiveness
The Dept. of Education lists the following three qualifications for forgiveness:
- Borrower must not be in default on the loans for which forgiveness is requested.
- The borrower must be employed full-time by a public service organization.
- 120 required payments made under one or more of the following Direct Loan Program repayment plans:
- Income Based Repayment (IBR) Plan
- Income Contingent Repayment (ICR) Plan
- Standard repayment of at least $50 per month
- Any other approved Direct Loan repayment plan
Qualifying borrowers will have the the remaining balance on the borrower’s eligible loans forgiven.
Eligible Student Loans
The following William D. Ford Direct Loan Program loans are eligible for forgiveness:
- Federal Direct Stafford Loans (Direct Subsidized Loans)
- Federal Direct Unsubsidized Stafford Loans (Direct Unsubsidized Loans)
- Federal Direct Plus Loans (Direct Plus Loans): For parents and graduate or professional students
- Federal Direct Consolidation Loans (Direct Consolidation Loans)
Other Federal Family Education Loan (FFEL) Program loans qualify if the borrower consolidates these federal loans into a federal Direct Consolidation. These include Federal Perkins Loans for certain health professions and nursing loans. The interest rate on a Direct Consolidation Loan is a fixed rate based on a weighted average of the interest rates of the loans that you consolidate, rounded up to the next higher one-eighth of one percent.
Ineligible Student Loans
Loans in default are not eligible. However, a defaulted loan may become eligible if the borrower rehabilitates the defaulted loan. Parent Plus loans are not eligible to be repaid under IBR or ICR. However, a Parent Plus borrower could consolidate the Plus loans and then choose ICR for the new Direct Consolidation Loan. Note that the parent who signed the Parent Plus loan contract must be employed in public service to qualify, and not necessarily the student. (See the Bills.com resource Parent Plus Loan Consolidation to learn more.
What Qualifies as a Public Service Job?
The specific job that you perform does not matter, as long as you are employed by a public service organization and work 30 or more hours per week. According to the Dept. of Education, any federal, state, or local government organization or agency and most 501(c)(3) non-profit organizations qualify for the PSLF program. However, the organization may not be a labor union, a partisan political organization, or an organization that is engaged in religious activities unless the qualifying public services it provides are unrelated to religious instruction, worship services, or proselytizing.
Visit the Dept. of Education Public Service Loan Forgiveness Web page to learn more about how student loan forgiveness works.
10 Comments
Union membership does not exclude you from the Public Service Loan Forgiveness (PSLF) Program. However, if you were employed by the International Association of Fire Fighters or another union, then you may not be eligible for PSLF.
I am a Licensed Clinical Social Worker in New York State. I have been in practice for 20 years. I am currently a volunteer mental health therapist through Governor Cuomo's office during the COVID-19 pandemic, particularly for frontline nurses, as I am a licensed RN, in NY, as well. I am 72 years old and continue to practice and continue to repay my student loan for my MSW/LSCW. My office is in rural Hudson Valley where I do see pro-bono client, as well. Am I eligible for some debt relief?
Pamela, I apologize that your question fell into the cracks and didn't receive a timely reply.
I don't know the exact requirements for Public Service Student Loan Forgivness but I think it requires more than the pro-bono component to which you referred (which is separate from it being a generous and find thing to have done).
I would take two routes to exploring what is available:
I would contact my loan servicer(s) and ask them.
See what the government says. Start at this page about managing your loan. You should also be able to get info about leniencies due to COVID-19. Good luck.