Do I Qualify for Public Service Loan Forgiveness?
To participate in Public Service Loan Forgiveness, make sure that you meet all the requirements. You must have the right type of loans, the correct occupation, a full-time job, and the correct repayment plan. Plus, you need to make eligible payments for ten years. After ten years, if you meet all of these conditions, you are eligible to have the remaining balance on your student loans forgiven.
Let’s dive into each aspect of Public Service Loan Forgiveness qualifications.
Check if You Have Qualifying Loans
Only Direct Loans qualify for Public Service Loan Forgiveness. You can check your loan type with your student loan servicer. If you do not have direct loans, you can consolidate your student loans into a direct consolidation loan to qualify.
Does Your Employment Qualify?
Any full-time job in a government organization at any level or with any non-profit organization that is a tax-exempt 501(c)(3) will allow you to qualify for public service. Government positions include jobs at the federal, state, local, and tribal level. Time spent working full-time for the Peace Corps or Americorps as a volunteer can also count as qualified employment.
You must work a qualifying job for ten years. But you should note that you don’t have to work the same qualifying job for the entire time. Nor do you have to work your ten years consecutively. But you do need ten years of qualifying payments while working for a qualifying employer to complete the program.
Qualifying Repayment Plans and Payments
To qualify for Public Service Loan Forgiveness, you have to be on the right repayment plan. All income-driven repayment plans currently offered by federal student loan servicers qualify for Public Service Loan Forgiveness. Payments made under the standard repayment plan also qualify. But this plan allows for full repayment of your balance in ten years, so there would be nothing left to forgive. For your payments to count, make all of your payments no later than fifteen days after your due date and always pay the full amount indicated on your bill.
Submit the Public Service Loan Forgiveness Employment Certification Form annually to be sure that your employer qualifies for the program. I recommend filling this form out every year even if your employer has not changed. This will help you be sure you are still meeting all the requirements of the program.
Note that there’s only one student loan servicer that is a part of the Public Service Loan Forgiveness Program, FedLoan. If you have a different servicer, when you fill out the Employment Certification Form, send it to FedLoan, and your student loan servicer will be changed to FedLoan.
After completing your 120 payments, fill out and submit the Public Service Loan Forgiveness Application for Forgiveness to be sure your payments are counted and your loans are forgiven.
Kimbree Redburn is an Accredited Financial Counselor® with a background in economic development. She works with her clients to help them understand their financial options and make money decisions with confidence. She believes that financial education gives people a chance to build a better life.