Public Service Loan Forgiveness

In 2007, Congress created the Public Service Loan Forgiveness Program to encourage individuals to enter and continue to work full time in public service jobs. Under this program, you may qualify for forgiveness of the remaining balance due on your eligible federal student loans after you have made 120 payments on those loans under certain repayment plans while employed full time by certain public service employers. Since you must make 120 monthly payments on your eligible federal student loans after October 1, 2007 before you qualify for the loan forgiveness, the first cancellations of loan balances will not be granted until October 2017.

What federal student loans are eligible for forgiveness under the PSLF Program?
Any non-defaulted loan made under the William D. Ford Federal Direct Loan Program (Direct Loan Program) is eligible for loan forgiveness. (See below for information on how non-Direct Loans may be eligible.) The Direct Loan Program includes the following loans:

  • Federal Direct Stafford/Ford Loans (Direct Subsidized Loans)
  • Federal Direct Unsubsidized Stafford/Ford Loans (Direct Unsubsidized Loans)
  • Federal Direct PLUS Loans (Direct PLUS Loans)—for parents and graduate or professional students
  • Federal Direct Consolidation Loans (Direct Consolidation Loans)

NOTE: To qualify for forgiveness of a parent PLUS Loan you, the parent borrower, not the student on whose behalf you obtained the loan, must be employed by a public service organization.

How can other federal student loans become eligible for loan forgiveness under the PSLF Program?
Although loan forgiveness under this program is available only for loans made and repaid under the Direct Loan Program, loans made under other federal student loan programs may become eligible for forgiveness if they are consolidated into a Direct Consolidation Loan. However, only payments made on the Direct Consolidation Loan will count toward the required 120 monthly payments.

The following loans may be consolidated into the Direct Loan Program:

  • Federal Family Education Loan (FFEL) Program loans, which include:
    • Subsidized Stafford Loans
    • Unsubsidized Stafford Loans
    • Federal PLUS Loans—for parents and graduate or professional students
    • Federal Consolidation Loans (excluding joint spousal consolidation loans)
  • Federal Perkins Loans
  • Certain Health Professions and Nursing Loans

NOTE: To consolidate a Federal Perkins Loan or Health Professions or Nursing Loan into the Direct Loan Program, you must also consolidate at least one FFEL Program loan or Direct Loan. If you are unsure about what kind of loans you have, you can find information about your federal student loans in the U.S. Department of Education’s National Student Loan Data System at www.nslds.ed.gov.

What are the borrower eligibility requirements for loan forgiveness under the PSLF Program?

  • You must not be in default on the loans for which forgiveness is requested.
  • You must be employed full time by a public service organization
    • when making each of the required 120 monthly loan payments (certain repayment conditions apply—see below);
    • at the time you apply for loan forgiveness; and
    • at the time the remaining balance on your eligible loans is forgiven.

What are the specific loan repayment requirements for loan forgiveness under the PSLF Program?

  • You must have made 120 separate monthly payments after October 1, 2007, on the Direct Loan Program loans for which forgiveness is requested. Earlier payments do not count toward meeting this requirement. Each of the 120 monthly payments must be made for the full scheduled installment amount within 15 days of the due date.
  • The 120 required payments must be made under one or more of the following Direct Loan Program repayment plans:
    • Income Based Repayment (IBR) Plan (not available to parent Direct PLUS Loan borrowers)
    • Income Contingent Repayment Plan (not available to parent Direct PLUS Loan borrowers)
    • NEW - Pay As You Earn Repayment Plan (not available to parent Direct PLUS Loan borrowers)
    • Standard Repayment Plan with a 10-year repayment period
    • Any other Direct Loan Program repayment plan; but only payments that are at least equal to the monthly payment amount that would have been required under the Standard Repayment Plan with a 10-year repayment period may be counted toward the required 120 payments

For more information about the repayment plans available in the Direct Loan program, please visit www.studentaid.ed.gov/repaying.

IMPORTANT NOTE: The PSLF Program provides for forgiveness of the remaining balance of a borrower’s eligible loans after the borrower has made 120 qualifying payments on those loans. In general, only borrowers who are making reduced monthly payments through the Direct Loan Income Contingent or Income Based repayment plans will have a remaining balance after making 120 payments on a loan.

What types of public service jobs will qualify a borrower for loan forgiveness under the PSLF Program? You must be employed full time (in any position) by a public service organization, or must be serving in a full-time AmeriCorps or Peace Corps position. Organizations that meet the definition of “public service organization” for purposes of the PSLF Program are listed below.

  • A government organization (including a federal, state, local, or tribal organization, agency, or entity; a public child or family service agency; or a tribal college or university);
  • A non-profit, tax-exempt organization under section 501(c)(3) of the Internal Revenue Code (includes most not-forprofit private schools, colleges, and universities);
  • A private, non-profit organization (that is not a labor union or a partisan political organization) that provides one or more of 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 prekindergarten)
    • 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
    • School library or other school-based services

NOTE: Your employment at a non-profit organization does not qualify if your job duties are related to religious instruction, worship services, or any form of proselytizing.

How can I keep track of my eligibility?
The U.S. Department of Education has created the Employment Certification for Public Service Loan Forgiveness form and a process to help you monitor your progress toward making the 120 qualifying payments necessary to apply for PSLF. You should complete the form, including your employer’s certification of employment, and submit it to FedLoan Servicing, the PSLF servicer, at the address listed in Section 6 of the Employment Certification form.

The form allows you to get your employer’s certification of employment while you are still employed at that organization or shortly after leaving. The process allows you to receive confirmation of qualifying employment and Direct Loan payment eligibility. You may also submit the form less frequently than annually to cover more than one year’s employment or for more than one employer.

While use of the form and process is not required, it will help you keep track of your progress toward meeting the PSLF eligibility requirements. If you do not periodically submit the form, you will still be required to submit a form for each qualifying employer at the time you apply for forgiveness and when forgiveness is granted.