Public Service Loan Forgiveness

If you work full-time for the government (i.e. federal, state, local, or tribal) or a non-profit organization, you may qualify for the Public Service Loan Forgiveness Program. Additionally, you should still have Direct Federal Student Loans or Direct Consolidated Loans, and make at least 120 qualifying payments. These repayments may also be done under an Income-Driven Repayment plan if ever you would need to make lower monthly payments on your Federal student loans.

Those who have Direct loans–including Stafford, PLUS, and consolidation loans–are eligible to apply for the PSLF. If you have a Parent PLUS loan, you may qualify based on the parents’ employment or employer.

Your loans should not be on default and you should have paid 120 qualifying monthly payments on your loans. Payments could be done either through an IDR or a Standard Repayment Plan, or a Graduated Repayment Plan.

Lastly, you should be employed full-time for a qualified employer, that is, the government or a non-profit organization whose tax exempt under Section 501(c)(3) of the Internal Revenue Code.

To qualify for PSLF, the type of job itself is not important. What’s being checked is your employer—regardless of the type of job you actually do for that employer. If you work for the government–whether federal, state, local, or tribal–and if you see yourself working there for at least 10 years, then you have the option to apply for PSLF.

Working for non-profit organizations 501(c)(3), or for tribal colleges and universities, or the military and public schools, then these are also considered as working in public service. Full-time Americorp or Peace Corp jobs are also considered.

Other than those mentioned, if you work for an organization that provides the following services, you may also think about being qualified for PSLF. These services include but not limited to: emergency management, public safety, law enforcement, public services for individuals with disabilities or the elderly, public hospitals, public libraries, and public health, just to name a few.

“Full-time” is defined as working at least 30 hours per week or the number of hours that the employer considers as full-time. It isn’t required that you should be in the same public service job for consecutive years or during the entire 10-year period of your employment.

Employment Certification is needed by the Department of Education to determine whether the borrower meets the eligibility requirement for PSLF. This is also helpful in determining the number of qualifying payments to be considered for PSLF.

As per the requirement of the Department of Education, the borrower is required to submit an Employment Certification for each employer where they have worked with while making the 120 qualifying payments.

The importance of the Employment Certification are as follows:

• It is used to determine whether the borrower’s loans and employer are qualified for PSLF
• If the loan types or the employer or both are deemed not qualified for PSLF, the Department of Education will notify the borrower as soon as possible.
• If the employment qualifies, and some or not all the loans are being serviced by Fedloan Servicing, then some or all of those loans will be transferred to Fedloan as the loan servicer. The borrower will be notified of the transfer.
• If the employment and loans are qualified, the Department of Education will review the borrower’s payment history. The review will determine if the borrower has indeed made 120 qualifying payments under a qualified employment. If the borrower is under a qualified employment but falls short of the 120 qualifying payments, then the Department of Education will inform the borrower about how many payments are still needed before applying for PSLF.