Last month’s blog discussed why many people are unable to receive loan forgiveness through the Department of Education’s Public Service Loan Forgiveness program (PSLF). The Department of Education allows some federal student loan borrowers working at certain public service jobs to receive tax-free loan forgiveness. However, the PSLF program has numerous requirements. You should ensure that you stay qualified if you are enrolled in this program. Please note that information in this blog post is subject to change, and that any recommendations in this post are not to be construed as legal advice. Make your payments on time You will need to make 120 timely payments to qualify for PSLF forgiveness. Your student loan servicer offers an automatic payment option. By enrolling in this option, your bank account will be automatically debited each month to pay down your balance. If you’re financially organized and aware of the timing of these…
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Our blog last week discussed one reason why student loan borrowers who enrolled in the Public Service Loan Forgiveness (PSLF) program had their eligibility revoked. Many of the borrowers carried federal loans that are not eligible for PSLF, such as FFEL or Perkins Loans. However, you could also be denied forgiveness because of where you work. Only certain types of jobs are eligible for PSLF. While Congress is poised to kill off PSLF, this does not necessarily mean you will lose eligibility if you are already enrolled. You should be careful if you are seeking forgiveness through the PSLF program and are planning a job change. According to the Department of Education’s website, only the following jobs can qualify for PSLF. Government organizations: Employees at federal, state, local or tribal organizations are eligible for PSLF forgiveness. Examples may include the Central Intelligence Agency or the Federal Bureau of Investigation. City…
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More student loan borrowers are coming forward with stories of how they were denied student loan forgiveness under the Public Service Loan Forgiveness (PSLF) program. An article on CNN discussed the story of a woman with $100,000 in student loans who only recently found out that some of her education debt is not eligible for forgiveness under the program. Signed into law in 2007, the PSLF program allows eligible borrowers in certain types of public service jobs to make timely payments over ten years to receive tax-free loan forgiveness. Some people are being denied because they have the wrong type of federal student loans. When PSLF was created in 2007, many borrowers were still receiving loans under the Federal Family Education Loan program (FFEL). FFEL loans are not eligible for forgiveness under PSLF. As of July 1, 2010, many new federal student loans were issued under the Direct Loan program….
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