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Public Service Loan Forgiveness: What It Is and How It Can Help You

Public Service Loan Forgiveness (PSLF) is a program that offers student debt relief for people working in public service. The program can be beneficial for people who have high student debt. Continue reading to learn more about PSLF and how it can help you! 

Related: Scholarships360’s free scholarship search tool

About Public Service Loan Forgiveness

Public Service Loan Forgiveness is a federal program that was started in 2007. The program encourages graduates to pursue a career in public service. 

If a borrower with federal loans works for a qualifying employer and makes 10 years of student loan payments, they will have their remaining loan balance forgiven. The forgiveness is tax-free. The 120 payments must be made in full, and the payments must also be made while enrolled in a income-driven repayment plan. This is because the loan balance would be paid off by the time you’re eligible for forgiveness on the standard 10-year plan.

See also: All about income-driven repayment plans

PSLF eligibility

PSLF has specific eligibility requirements. Applicants must meet all of the requirements in order to receive forgiveness. 

The first main requirement is employment by the government, a 501(c)(3) non-profit, or an organization that does not have 501(c)(3) status but provides a public service. Examples of such services are:

• Emergency management
• Military service
• Public safety
• Law enforcement
• Public interest law services
• Early childhood education
• Service for individuals with disabilities and the elderly
• Public health
• Public library services
• School library or other school-based services

To check if your employer makes you eligible for PSLF, use the PSLF Help Tool. This tool will also allow you to track how many payments you have left. 

The second requirement is the type of loans that are forgivable. PSLF will only forgive federal Direct Loans. It is not applicable to private loans. If you have FFEL or Perkins loans, they can be consolidated into a Direct Consolidation Loan. Be sure to consolidate these loans as soon as possible if you want to have them forgiven so that your payments count toward the required amount.

Also see: Guide to student loan forgiveness programs

How can PSLF help you?

Public Service Loan Forgiveness can provide student debt relief for people working in public service. After 10 years of payments, you will have the remainder of your debt forgiven. 

PSLF is beneficial because payments are based on an income-driven repayment plan. Payments on these plans are based on your income, so you’ll be paying less per month than you would on the standard 10-year plan.

PLSF also encourages work in public service. This work can be rewarding and benefit other people. If you are hoping to work or already work in public service, be sure to check your eligibility for Public Service Loan Forgiveness!

Related: Grants to pay back student loans

Other options

If you are struggling to make your student loan payments but don’t qualify for Public Service Loan Forgiveness, there are other options out there. Falling behind on student loan payments can have severe consequences, so you should make sure to address the problem sooner rather than later.

One of the best options if you’re not earning as much as you expected after graduation is an income-driven repayment plan. These plans base your monthly payments on your monthly income to make them more feasible. You can also look into getting your student loans deferred. If you qualify for deferment, you can take a break from repaying your loans. Oftentimes, your interest will still accrue during this time, so the option is not without its drawbacks.

You can also look into refinancing and consolidating your loans. Our comparison of refinancing and consolidating can help you to pick which option is best for you.

Frequently asked questions about Public Service Loan Forgiveness

Can you rely on Public Service Loan Forgiveness?

Public Service Loan Forgiveness is a program that can save you a substantial amount on your student loan debt. The program only kicks in after 10 years, so you’ll have to plan for it well in advance.

You can rely on the program as long as you are able to secure eligible jobs for that entire timespan. But before taking out loans with the intent of utilizing Public Service Loan Forgiveness, make sure to read the terms very carefully. 10 years of planning could result in $0 in loan forgiveness if you aren’t able to satisfy the strict requirements.

Additionally, remember that it is hard to know where you will be in 10 years. If you are not absolutely sure that you will continue in the public sector for that entire time, don’t rely on the program. And be cautious when taking out additional loans with the intent of qualifying for forgiveness. Remember, too much student loan debt is never a good idea!

Do I qualify for Public Service Loan Forgiveness?

If the loans you want to have forgiven are direct loans from the government, and you have maintained eligible jobs since graduation, you might qualify. You can use the PSLF Tool to ensure that your job qualifies for the program. Your must also work for at least 30 hours per week at your qualifying job. If you go through a period of unemployment, or employment at a non-qualifying position, you may be disqualified. Before making any decision in a change in employment, use the PSLF Tool to double-check that it will not disqualify you.

Is student loan forgiveness a scam?

There are many real student loan forgiveness programs out there, but not everyone qualifies for them. Likewise, there are many student loan forgiveness scams. Strangers may contact you offering to get your loans forgiven and request your personal information and/or a payment. These are always scams and you should never pay to get your loans forgiven. For more information to scope out these scams, check out our guide on how to avoid student loan forgiveness scams.