OAKLAND – California Attorney General Rob Bonta today issued a consumer alert highlighting important information regarding recent changes to the Public Service Loan Forgiveness (PSLF) and Public Service Loan Forgiveness Programs. extended public service loans (TEPSLF). On October 6, 2021, the U.S. Department of Education (ED) announced that it will be implementing key enhancements to the PSLF program that should provide more eligible government employees with the student loan forgiveness they deserve. As part of these improvements, ED has launched a limited time offer Limited Public Service Loan Forgiveness Opportunity which will continue until October 31, 2022, allowing eligible borrowers to receive credit for past payments made on loans that would otherwise not be eligible for the PSLF program. This move by ED to improve the PSLF program follows a years-long trial and advocacy by state attorneys general and others urging ED to take strong action to fix the flawed PSLF program.
“California officials work day in and day out on behalf of the people of this state. Many have taken out student loans to become our firefighters, teachers, doctors, and more, with the promise of debt relief eventually,” said Attorney General Bonta. “These civil servants have been disappointed by a broken system, but thanks to recent changes, they will finally be able to receive the loan forgiveness to which they are entitled. If you are a public servant who holds federal student loan debt, I urge you to take advantage of the new PSLF limited waiver opportunity.
How to check if your payments are eligible under the PSLF Limited Waiver
Under the rules of the temporary program, any previous payment made will count as an eligible payment, regardless of loan type, repayment plan, or whether the payment was made in full or on time. All you need is qualifying employment. This temporary change applies to student borrowers with direct loans, those who have already consolidated into the direct loans program, and those who have consolidated into the direct loans program by October 31, 2022.
There are two conditions for receiving additional qualifying payments:
- Full time employment: You must have worked full-time for an eligible employer when the previous payments were made. If you were employed in more than one qualifying part-time job at the same time, you will be considered full-time if you worked a combined average of at least 30 hours per week. You can only receive credit for payments made after October 1, 2007, as that is when the PSLF program began. If you have not already done so, you must submit a PSLF & TEPSLF certification and application for any period for which you may receive additional qualifying payments.
- Loan consolidation: If you have Federal Family Education Loans (FFEL) loans, Federal Perkins loans, or other types of federal student loans that are not direct loans, you must consolidate those loans into the loans program. direct by October 31, 2022.
How to Use the Limited PSLF Waiver
- You have Direct Loans and you have already had PSLF jobs certified: If you have already applied for the PSLF and have at least one certified job, ED will grant any additional payment without further action on your part. If necessary, Federal Student Aid may contact you to ask you to certify additional months of employment. You should look for an email from Federal Student Aid in the coming weeks to let you know how many additional payments they have previously determined to be eligible. There is nothing you need to do until you receive a payment count update or other communication from ED.
- If you know you have an eligible job that you have not yet certified with ED, you must certify that job now using the PSLF Help Tool at www.StudentAid.gov/pslf.
- You currently have Direct Loans and have not yet applied for PSLF: You will need to submit a PSLF form so that ED can review your loans under the new rules and determine if your current or past employers are eligible for the PSLF. You can submit this form through the PSLF help tool at www.StudentAid.gov/PSLF. Please be aware that the ED is expecting an influx of applicants due to the recent announcement, so you may experience delays in processing your application. You must submit your application by October 31, 2022.
- You have at least one federal student loan that is not a direct loan, such as an FFEL loan: You will need to submit a consolidation request and PSLF form by October 31, 2022 to ensure that payments made on loans that are not direct loans can be accounted for in the PSLF. Currently, ED recommends that you consolidate before using the PSLF Helper Tool to certify employment. If you wish to verify your employer’s eligibility for the PSLF before consolidating, you can do so by logging into the PSLF Help Tool, available at www.StudentAid.gov/PSLF. If you have a combination of FFEL and direct loans, please refer to the sections above to understand how your direct loans will be affected.
- You have already tried to certify employment for PSLF but you have been refused: If ED has previously declared that your employer is not eligible for the PSLF, you must submit a new form through the PSLF Help Tool to see if you can receive credit for the pardon. You can also see which employers ED has already deemed eligible through the PSLF help tool. Please note that this exemption does not affect the eligible employer rules. Your employer must still be a government organization, 501(c)(3) organization, or non-profit organization that provides a designated public service to obtain the PSLF under the normal rules and the limited PSLF waiver.
- You don’t know what type of federal loans you have: It is very common for borrowers not to know what type of federal loans they have. You can see what loans you have by logging into your account at www.StudentAid.govgo to the My Aids page (www.StudentAid.gov/aid-summary/) and scroll down to the Loan Detail section. There, you’ll see a list of every loan you’ve borrowed, even if you’ve paid off the loan or consolidated it into a new loan. Direct loans begin with the word “direct”. Federal Home Education Loans begin with “FFEL” and Perkins Loans include the word “Perkins” in the name.
You can find additional information and useful tools regarding the PSLF program at www.studentaid.gov/manage-loans/forgiveness-cancellation/public-service. Additionally, you can find an updated PSLF program fact sheet from ED here.