Department of Education Announces Actions to Improve the Public Service Loan Forgiveness Program
October 18, 2021
October 7, 2021
On October 6, the Department of Education (ED) announced a set of actions to improve the Public Service Loan Forgiveness Program (PSLF). The program provides debt relief to public service workers by cancelling debt after 10 years of service but to date has been plagued with administrative errors and nearly impossible to navigate.
These changes are expected to bring more than 550,000 people closer to debt cancellation, including 22,000 who will be immediately eligible. Improvements to PSLF are significant as more than half of all educators have student debt averaging $55,800.
The ED announcement includes both short-and long-term solutions that will help restore the promise of the PSLF program.
In the short-term, ED has implemented a limited waiver that will count all prior payments on any federal loan towards PSLF. This waiver is in effect until October 31, 2022. Borrowers will need to consolidate, if necessary, and submit a PSLF form before the waiver ends to have previously ineligible payments counted.
The waiver will also automatically adjust PSLF payment counts for those made on or before October 31, 2021 but were rejected due to technical requirements like payment plan or amount. Borrowers who have not yet applied for PSLF forgiveness or certified employment but do so by October 31, 2022 will benefit from these temporary rules as well.
The longer-term actions include: reviewing all denied applications and providing a reconsideration process for borrowers who believe there was an error in their application process; improving communication to notify borrowers who are eligible for forgiveness and provide information on what actions are required; and simplifying the application process to make it more accessible to borrowers.
More information for borrowers can be found here.
