Does PSLF forgive Direct Loans? (2024)

Does PSLF forgive Direct Loans?

Generally, no. The Standard Repayment Plan for Direct Consolidation Loans is not the same repayment plan as the 10-year Standard Repayment Plan, and payments made under the Standard Repayment Plan for Direct Consolidation Loans do not usually qualify for PSLF purposes.

Do Direct Loans qualify for PSLF?

Only loans you received under the Direct Loan Program are eligible for PSLF. Loans you received under the Federal Family Education Loan (FFEL) Program, the Federal Perkins Loan (Perkins Loan) Program, or any other student loan program are not eligible for PSLF.

Can Direct Loans be forgiven?

If you work full time for a government or nonprofit organization, you may qualify for forgiveness of the entire remaining balance of your Direct Loans after you've made 120 qualifying payments—i.e., 10 years of payments. To benefit from PSLF, you need to repay your federal student loans under an IDR plan.

Does PSLF forgive the entire balance of payments?

The number of qualifying payments you have made will be updated only when you submit another PSLF form that documents a new period of qualifying employment. Once your cumulative total of qualifying payments reaches 120, the PSLF servicer will confirm your eligibility and forgive your remaining balance.

Has anyone been forgiven for PSLF?

As of mid-July 2023, approximately 662,000 borrowers have qualified for forgiveness under the limited PSLF waiver. Although the limited PSLF waiver period has ended, some borrowers who submitted their applications prior to the end date may continue to have their applications processed from the waiver period.

What loans are ineligible for PSLF?

What loans can be forgiven? Only Direct Loan Program loans that are not in default are eligible for PSLF and TEPSLF. Loans you received under the Federal Family Education Loan (FFEL) Program, the Federal Perkins Loan (Perkins Loan) Program, or any other student loan program are not eligible for PSLF.

Do Direct Loans have to be consolidated for PSLF?

Only Direct Loans are eligible for PSLF. If your loan type isn't eligible, you can consolidate your non-eligible federal student loans into a Direct Consolidation Loan to make them eligible for PSLF.

Can direct unsubsidized loans be forgiven?

You'll also be eligible for student loan forgiveness on any remaining balance after the repayment period ends. This is usually after 20–25 years. Both direct subsidized and unsubsidized loans are eligible for any of the four IDR plans.

What type of repayment plans qualify for PSLF?

To maximize your PSLF benefit, you should repay your loans on the Income-Based Repayment (IBR) Plan or the Income- Contingent Repayment (ICR) Plan, which are two of the repayment plans that qualify for PSLF.

Do I have to pay back a direct loan?

Once you graduate, drop below half-time enrollment, or leave school, your federal student loan goes into repayment. However, if you have a Direct Subsidized, Direct Unsubsidized, or Federal Family Education Loan, you have a six-month grace period before you are required to start making regular payments.

Do $0 payments count for PSLF?

Yes. Any month when your scheduled payment under an income-driven repayment plan is $0 will count toward PSLF if you also are employed full-time by a qualifying employer during that month.

What if Mohela says I have 120 qualifying payments?

After you make your 120^th qualifying monthly payment, submit the PSLF form to receive loan forgiveness. You must be working for a qualifying employer at the time you submit the form. Use the PSLF Help Tool to complete your form. You can also fax your PSLF form to 866-222-7060.

What happens after you make 120 qualifying payments for PSLF?

PSLF Form After Making 120 Qualifying Payments

If your PSLF form is approved for forgiveness, then you'll be notified that the entire remaining balance of your eligible Direct Loans will be forgiven, including all outstanding interest and principal.

Why were so many people denied PSLF?

“Errors, even as minor as spelling mistakes, can cause rejections. For PSLF for example, borrowers must thoroughly fill out an Employer Certification Form (ECF) with all of their previous employers, their Federal Employer Identification Numbers, tax status, and other details.

What is the success rate of PSLF?

Applications are approved at roughly the same rate. 2.3% of processed applications for PSLF had been approved since the program's inception. In the program's first year, 0.32% of applications were approved. Prior to 2021, 3.3 million student loan borrowers were eligible to apply for PSLF (though only 6.9% applied).

How much student loan does PSLF forgive?

There is no limit to how much can be forgiven by PSLF. The program forgives the remaining balance of your federal student debt after 10 years of service and 120 payments to your federal student loans. We have seen NEA members receive on loans with balances of $20,000, $100,000, and even more.

Does COVID count towards PSLF?

Do the months on the COVID-19 payment pause count toward my PSLF payment count? Paused payments count toward PSLF and TEPSLF as long as you meet all other qualifications. You will get credit as though you made monthly payments.

Does forbearance count towards forgiveness?

You can also choose to enter forbearance until your forgiveness is processed. But if you enter forbearance and do not yet reach 20 or 25 years' worth of payments, you won't get credit for the period of forbearance and will need to make additional eligible payments to reach forgiveness.

Can you do both PSLF and loan forgiveness?

Loan Forgiveness Under TLF and PSLF

You can potentially receive forgiveness under both TLF and the Public Service Loan Forgiveness Program, but not for the same period of teaching service.

How do I know if my MOHELA loan will be forgiven?

If you work in certain public service jobs and have made 120 payments on your Direct Loans, you may be eligible to have your loans forgiven. If some or all of your payments were not made on a qualifying repayment plan for PSLF, you may be able to receive loan forgiveness under a temporary opportunity.

Why is my MOHELA payment zero?

MOHELA, the loan servicer for the PSLF program, has stated that payment counts for PSLF may temporarily show zero qualifying payments. This can be really confusing for borrowers who were told they needed to consolidate their loans in order to be eligible for PSLF or to maximize their eligibility for PSLF.

What is PSLF buyback?

The buyback opportunity is only available to you if you already have 120 months of qualifying employment and buying back months in forbearance or deferment would result in forgiveness under PSLF or Temporary Expanded PSLF (TEPSLF).

Does PSLF forgive subsidized and unsubsidized loans?

Which loans are eligible for loan forgiveness? Only Federal Direct Loan Program loans that are not in default are eligible for PSLF (ie - Direct Subsidized Loans, Direct Unsubsidized Loans, Direct PLUS Loans, Direct Consolidation Loans).

How do I get my direct subsidized loan forgiven?

The PSLF Program forgives the remaining balance on your Direct Loans after you've made the equivalent of 120 qualifying monthly payments while working full time for a qualifying employer.

Does student loan forgiveness apply to Direct Loans?

Only federal Direct Loans can be forgiven through PSLF. If you have other federal student loans such as Federal Family Education Loans (FFEL) or Perkins Loans you may be able to qualify for PSLF by consolidating into a new federal Direct Consolidation Loan.