Public Service Loan ForgivenessThe Public Service Loan Forgiveness Program begins July 1, 2009, and is intended to encourage individuals to enter and maintain their careers in the Public Service arena. The program offers forgiveness of the outstanding Federal Student Loan balance to borrowers who have made 10 years (120 monthly payments) of qualifying payments. Eligible payments are payments made beginning October 1, 2007.
The following loan types are eligible for the Loan Forgiveness:
- Federal Direct Subsidized/Unsubsidized Stafford Loans
- Federal Direct Grad Plus Loans
- Federal Direct Consolidation Loans
- Federal Direct Special Consolidation Loans
Borrowers with loans via the Federal Family Education Loan (FFEL) Program must consolidate* their loans with the Federal Direct Loan Program to qualify for the Public Service Loan Forgiveness Program.
*Note that payments made prior to the consolidation do not count toward the 120 required payments. For more information on the impact of consolidating our loans, visit the Consolidation page.
- Must not be in default on the loans for which forgiveness is requested.
- Must be employed full-time by a public service organization-
- While making 120 (10 years) on time payments;
- Must be employed at a Public Service Organization at the time of application for forgiveness;
- Must be employed at a Public Service Organization at the time of forgiveness.
Public Service is defined as full-time work in any position, in one of the following areas:
- Full-time service in AmeriCorps or Peace Corps.
- Full time employment by a “Public Service Organization” defined as:
- A federal, state, local, or Tribal government organization, agency, or entity (includes most public schools, colleges and universities);
- A public child or family service agency;
- A non-profit organization under section 501(c)(3) of the Internal Revenue Code that is exempt from taxation under section 501(a) of the Internal Revenue Code (includes most not-for-profit private schools, colleges, and universities);
- A Tribal college or university;
- A private organization that is not a for-profit business, a labor union, a partisan political organization, or an organization engaged in religious activities (unless the qualifying activities are unrelated to religious instruction, worship services, or any form of proselytizing) and that provides the following public services –
- Emergency management;
- Military service;
- Public safety;
- Law enforcement;
- Public interest law services;
- Early childhood education (including licensed or regulated health care, Head Start, and state-funded pre-kindergarten);
- Public service for individuals with disabilities and the elderly;
- Public health (including nurses, nurse practitioners, nurses in a clinical setting, and full-time professionals engaged in health care practitioner occupations and health care support occupations);
- Public education;
- Public library services; and
- School library or other school-based services.
Beginning January 31, 2012 the U.S. Department of Education began the Employment Certification program. This program is meant to assist the borrower in tracking their PSLF employment and payment eligibility. Borrowers interested in participating in this program should read and submit the following forms:
Related PSLF Information:
Borrowers do not have to be employed for 10 consecutive years within Public Service, however; payments made during the non-qualifying employment period will not count toward the 120 required payments for loan forgiveness.
Typically the use of the standard payment plan will allow the borrower to repay the loan in-full before forgiveness would be available. Borrowers wishing to optimize the amount of forgiveness they would be eligible to receive, should consider utilizing a reduced monthly payment plan such as Income Contingent or Income Based repayment. Using a reduced payment amount will ensure that the amount forgiven is optimized.
For additional information you can view the final regulations for the Public Service Loan Forgiveness Program that were published on October 23, 2008 by the Department of Education at: http://www.ed.gov/legislation/FedRegister/finrule/2008-4/102308a.html.