#3: If you do everything right, the federal government will forgive your balances after 120 qualified payments
Note: The Department of Education does not require annual certification for you to qualify for forgiveness. If you are confident that your employment qualifies, you can skip certification; it’s just not recommended.
If you do everything right and start immediately, the earliest you will qualify for PSLF will be in 10 years. You must make 120 qualified payments to the federal repayment plan you chose. You can even switch to a different hardship-based repayment plan, if you stay in one of the programs listed above.
For example, if you enroll in an IBR and then decide to switch to PayE because your payments are still too high, you still qualify for PSLF and the clock doesn’t reset. Continue making payments, and after the 120 th payment, you can officially apply for PSLF.
Public professionals including nurses have been holding their breath to see if their colleagues qualify for student loan forgiveness
During that time, you can also switch jobs, but you must maintain employment in the public sector. Again, your safest bet is to re-certify your new position through the Employment Certification form.
It’s also important to note that qualified payment can mean a few things. It primarily refers to a scheduled payment that you make on time. However, in some cases depending on your repayment plan, you may also qualify to not make a payment.
For example, let’s say you enroll in PayE. If your income is 75% or less than the FPL in your state, your payments may be reduced or eliminated. You pay $0, but the federal government credits you for quick business loans Texas a qualified payment. Your balances don’t change, but you avoid penalties and maintain eligibility for PSLF. This usually only happens on PayE. Payments that you miss during forbearance or deferment do not count as qualified payments.
#4: All the rules listed above could change if the DOE end or cancel PSLF entirely
The final secret to qualifying for PSLF is also the most startling and troubling. PSLF is a government relief program some would call it an entitlement program. That means that the program is subject to change by the federal government. The current administration under Betsy DeVos, is already adjusting the program.
Under the Obama administration, PSLF expanded so more people were eligible. That’s why PSLF is often called Obama Student Loan Forgiveness even though the program originated under Bush in 2007. However, since you must make 10 years of qualified payments, the first graduates to qualify only became eligible for student loan forgiveness for nurses in .
So far, the Trump administration has limited the employment positions that qualify PSLF. Even if you previously certified your employment, you may no longer be eligible. There are reports of people that maintained ongoing employment certification, who now say they’ve been rejected.
A report by the Department of Education reveals that 99% of the 29,000 PSLF applications processed since have been rejected. Only 289 were approved. One third were rejected for incomplete paperwork, but the other two-thirds were denied for not meeting program requirements, from not having the right loans to not being enrolled in the right repayment plan.
This shows how critical it is to follow the requirements for PSLF qualification exactly. This is also where working with a professional student debt resolution specialist can help. Loan servicers are notoriously bad about providing the information that borrowers need to qualify for PSLF, so you often need a third party that can help you navigate the paperwork and processes.