Education Department Urges Borrowers To Apply For Student Loan Forgiveness Before October Deadline

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Student Loan Forgiveness For Public Service Workers Through Temporary Waiver

The Biden administration is stepping up efforts to encourage borrowers to apply for a student loan forgiveness initiative before it expires in October.

The initiative — a temporary expansion of a student loan forgiveness program for borrowers working in public service jobs — has already resulted in over $8 billion in approved student loan cancellation for thousands of borrowers, according to the Department of Education. But advocates are worried that many more borrowers may not realize that they qualify for relief.

The Public Service Loan Forgiveness (PSLF) program was enacted by Congress in 2007 to provide student loan forgiveness to borrowers who commit to working in public service careers. Borrowers who work for 10 years or longer in nonprofit or government jobs while meeting other program requirements can get their entire federal student loan balance canceled under the program.

But since its enactment, PSLF has been mired in problems due to complex eligibility rules, administrative problems, and poor oversight. As a result, approval rates hovered in the one to two percent range for years.

The Biden administration announced a temporary fix to PSLF’s problems in October. Through the Limited PSLF Waiver, the Education Department temporarily relaxed some of the program’s strict rules to retroactively count prior loan periods that otherwise could not qualify towards PSLF, including payments made under the “wrong” repayment plan or on the “wrong” type of federal student loan. The administration went even further in April to permit certain past periods of deferment and forbearance to count towards PSLF, as well.

But the Limited PSLF Waiver program is only available for a relatively short period of time — and that time is sending soon, with an October 31 expiration date approaching. 

Read the full story @ www.forbes.com

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