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ED Announces Plans for PSLF Overhaul

By Hugh T. Ferguson, NASFAA Staff Reporter 

The Department of Education (ED) formally unveiled details as to how the agency plans to rework the much-maligned Public Service Loan Forgiveness (PSLF) program. In referring to the program as an important but unmet promise of offering student loan debt forgiveness to public servants, ED aims to take a number of actions in the coming months to remedy the program’s high denial rate.

Specifically ED will offer, as a temporary opportunity, “a limited PSLF waiver” to give borrowers credit for prior payments they made that would not otherwise count toward PSLF. Any prior payments made while working for a qualifying employer will count as a qualifying payment, regardless of loan type or repayment plan.

Among the other departmental changes being developed in the coming months, ED will be seeking to simplify payment qualifications, reduce barriers for military service members enrolled in the program, review denied PSLF applications and correct processing errors, simplify and better communicate the application process, as well as continue work to overhaul the program through the ongoing negotiated rulemaking process.

“These changes are important steps toward a better and stronger PSLF program,” ED wrote in announcing the program’s impending reworking. “One that will move away from the current situation in which too few borrowers receive forgiveness, and too many do not receive credit for years of payments they made because of complicated eligibility rules, servicing errors or other technicalities.”

Stay tuned to Today’s News for more coverage of the PSLF program.

 

Publication Date: 10/6/2021


David S | 10/6/2021 9:58:10 AM

This is great news, but the level of complexity surrounding virtually all aspects of student loan repayment is still absurd. Let's strip this way down.

Joseph W | 10/6/2021 9:25:03 AM

Jose E - If I understand this situation correctly, assuming he worked for a qualified employer for the PSLF program, he had 2 separate loans that were disbursed on different dates. Each loan has an individual "counter" and since his GRAD PLUS loan did not exist when his when he was making payments on his Stafford loan, he will not get "credit" for that payment. The really difficult issue they will need to address is students that did a Direct Loan Consolidation...That's where it gets complicated. I'm interested to see what they plan to do with those situations.

Jose E | 10/6/2021 8:53:17 AM

This is good to hear. Had a former student come in to see me on Monday where he reached 120th payment on his Federal Stafford Unsub Loans, but the payment count on his Grad PLUS Loan was 43. The count should have been the same for both the Federal Stafford Loan and the Grad PLUS Loan, yet the servicer was stating that is the way it is. He tried on multiple occasions to get it corrected, but ran against reasons why it could not be fixed. How does that happen where one is counted and the other is not? I suggested he submit his PSLF Form for forgiveness and deal with it as an appeal.

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