Updated 11/28/22: Since this blog post was published, payments and interest on federally-held student loans are now set to resume 60 days after a court decision on President Biden’s forgiveness program. If no decision has been issued by June 30th, 2023, payments will resume 60 days later.
Since announcing the Public Service Loan Forgiveness (PSLF) Limited Waiver and its expanded eligibility rules last year, the Department of Education has granted $10 billion in debt relief to over 175,000 borrowers. But it’s estimated that only 15% of eligible borrowers have applied, despite the waiver’s fast-approaching deadline of October 31, 2022.
If you work in public service, now is the time to take advantage of the waiver. Public Service Loan Forgiveness — which forgives outstanding federal loans for public sector workers who make 10 years of monthly payments — isn’t going anywhere. But the opportunity to count payments on most loan types and repayment plans will end soon. Under the waiver’s temporarily expanded rules, many previously ineligible payments now count toward the 120 payments — or 10 years’ worth — required under PSLF. However, you may need to take action by the October 31st deadline in order to have your prior payments counted.
Here are three steps you may need to complete before the PSLF waiver expires, depending on your situation:
Submit employment certification form(s).
Working full-time for a public service employer is a requirement for PSLF, and you’ll need to submit an employment certification form for each such employer in order for your loan payments to count. You can go as far back in your employment history as October 2007, which is when the PSLF program launched.
If you’ve already submitted forms for former employers and they were accepted, then you’re all set - you don’t need to submit them again. But if there are employers you haven’t submitted forms for, or if you need to submit an updated form for your current employer, you’ll need to do so before October 31, 2022 to access the expanded rules.
By the way, if you’re working with Summer, we need to receive your completed consolidation and employment certification forms (including employer signatures) by October 15, 2022 so that we can review and submit them for you. After that date, you will have to submit forms through Federal Student Aid.
Consolidate your loans (if you need to).
This depends on the type of loans you have. If you have Direct loans, you do not need to consolidate them to qualify for the PSLF waiver. Past payments on FFEL loans will only count toward forgiveness if they are consolidated before the end of the waiver.
Meanwhile, Parent PLUS loans need to be consolidated to qualify for PSLF both during the waiver period and after. Under the waiver, past payments on Parent PLUS will not count unless they’re consolidated with other loans. If they’re consolidated on their own, only future payments will count toward forgiveness.
Notably, under the limited waiver, consolidating your loans will not reset the timeline for forgiveness the way it would have done in the past so your previous payments will actually count toward the 120 target.
If you have Perkins loans, you can consolidate them as well to access PSLF, but Perkins loans have their own forgiveness program that you may be eligible for.
Make sure you’re enrolled in income-driven repayment (IDR) when payments resume.
Unlike the other steps, this doesn’t need to be completed before October 31, 2022 (though we recommend doing this as soon as possible). The current pause on payments and interest is set to expire at the end of this year, so payments won’t resume until January 2023. When the freeze ends, you’ll want to make sure you’re enrolled in an IDR plan so that your payments will qualify for PSLF. Other repayment plans (like Graduated or Extended) will no longer qualify for PSLF once the waiver expires, so enrolling in IDR now will ensure you’re eligible.
We know this process may appear challenging to navigate, but we're here to help. For more detailed instructions on how to proceed based on your individual loan types, read our Help Center article on how to make sure your payments count. Additionally, you can always send us a note with your questions at hello@meetsummer.org if you have a Summer account.
If you’ve already done everything we’ve laid out here, then you’re in a great place! We know that it’s taking the loan servicers and the Department of Education up to three or four months to process forgiveness, so it may take a while to get a response.
Lastly, even though the process can be confusing and frustrating, it’s helpful to remember that getting loan forgiveness is actually achievable. Many borrowers have already experienced the joy and relief of getting to the finish line, and you can get there too. Remember: we’re on your side.
FAQs
We received unprecedented volumes of PSLF form submissions and consolidation applications. It will take time for the PSLF servicer, MOHELA, to process all the form submissions and make adjustments to your accounts. We expect that it may take at least 90 business days for MOHELA to process these forms.
Will PSLF waiver be extended? ›
No. In January 2023, we added certain eligible forbearances and deferments for PSLF waiver-eligible borrowers. Additionally, all PSLF borrowers with an approved PSLF form will begin to see the payment count adjustment applied to their PSLF counts in Fall 2023.
What if I missed the PSLF waiver deadline? ›
If you missed the deadline for the limited-time PSLF waiver, you could still take advantage of other payment reduction and forgiveness opportunities, including the Income-Driven Repayment Account Adjustment, a one-time payment count adjustment for eligible borrowers enrolled in an IDR program.
Can PSLF forgiveness be reversed? ›
Borrowers who are under the PSLF are the ones who need to keep an eye out for their discharges getting reversed. The folks at Business Insider were the ones who confirmed this was happening to several borrowers.
What is the MOHELA controversy? ›
Aside from its struggles with the PSLF program, MOHELA was dragged into the Supreme Court case last summer that ultimately killed universal student debt relief. After President Biden announced his plan in August 2022 to give at least $10,000 in loan forgiveness to every borrower, numerous groups filed lawsuits.
Is there a class action lawsuit against MOHELA? ›
Some witnesses on Wednesday called for statutory fixes, saying that complaints against MOHELA stem from problems at a federal level. There are two class-action lawsuits alleging MOHELA mismanaged loans. One additionally names the federal government as a plaintiff.
Can I still apply for PSLF in 2024? ›
As the PSLF and TEACH programs are transitioned, we will pause processing any forms for PSLF or TEACH Grants beginning on May 1, 2024. Borrowers can continue to submit PSLF and TEACH forms during this processing pause, but they will not be processed until the pause ends.
Why does my MOHELA balance say zero? ›
MOHELA, the loan servicer for the PSLF program, has stated that payment counts for PSLF may temporarily show zero qualifying payments. This can be really confusing for borrowers who were told they needed to consolidate their loans in order to be eligible for PSLF or to maximize their eligibility for PSLF.
Does COVID count towards PSLF? ›
Do the months on the COVID-19 payment pause count toward my PSLF payment count? Paused payments count toward PSLF and TEPSLF as long as you meet all other qualifications. You will get credit as though you made monthly payments.
What is the denial rate for PSLF? ›
However, for many, the program, which is generally open to student-loan recipients after they've worked in qualifying nonprofit or public-sector jobs for a decade, didn't work as intended: The Department of Education denied 98% of PSLF applications between November 2020 and October 2021.
Direct loan payments in excess of 120 are eligible for refund, but if you consolidated (or reconsolidated an existing direct consolidation) the payments must have been AFTER the consolidation to be refunded.
Do you have to make 120 payments for PSLF waiver? ›
PSLF Process
Because you have to make 120 qualifying monthly payments, it will take at least 10 years before you can qualify for PSLF. Important: You must still be working for a qualifying employer at the time you submit your form for forgiveness.
Is PSLF in danger? ›
PSLF is under threat of elimination.
Both the President's FY 2018 budget and H.R. 4508, legislation known as the PROSPER Act (Foxx, R- NC), would eliminate PSLF as part of a plan to reform federal student lending.
What was the mistake on the MOHELA loan forgiveness? ›
According to the letter from MOHELA, reviewed by BI, the company applied the incorrect end date to the periods during which David was working for a qualifying employer for relief through the Public Service Loan Forgiveness program, which forgives student debt for government and nonprofit workers after 10 years of ...
Did MOHELA rescind forgiveness? ›
Loan Servicer Revoking Forgiveness Puts New York's Student Loan Borrowers at Risk: Servicers Must Be Held Accountable for Their Mistakes. In a shocking turn of events, MOHELA, a prominent student loan servicer, has announced the rescindment of forgiveness previously granted to student loan borrowers.
How long does it take to hear back about PSLF waiver? ›
The PSLF application process can take a few months. It may take longer if you haven't been submitting regular PSLF Forms, or shorter. During the wait, you have the option of continuing to make payments or putting your loans into forbearance.
How long does it take to process PSLF waiver? ›
A final review of your account will be done to process forgiveness, which will take at least 90 business days. You are required to continue making payments while your form is being processed, unless your account is in a forbearance status.
How long is a PSLF waiver taking? ›
We know that it's taking the loan servicers and the Department of Education up to three or four months to process forgiveness, so it may take a while to get a response. Lastly, even though the process can be confusing and frustrating, it's helpful to remember that getting loan forgiveness is actually achievable.
How long is MOHELA taking to process PSLF? ›
Loans serviced by MOHELA? If you faxed or mailed your PSLF form to MOHELA it may take up to 14 days for your mohela.com account to note that the form was received. Please allow at least 90 business days for your form to be processed.
