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What is Public Service Loan Forgiveness?

The Public Service Loan Forgiveness (PSLF) program forgives the remaining balance on your federal Direct Loans after you make 120 qualifying monthly payments under a qualifying repayment plan while working full-time for a qualifying public service employer.

This program helps you manage your student loan debt while pursuing a career in public service. Public Service Loan Forgiveness (PSLF) is available to many employees working in public service, including all levels of government, states and municipalities, school districts, public hospitals, qualifying non-profit organizations, and more.

Here’s what to do if you want to learn more:

Step 1: Understand your choices

Only federal Direct Loans are eligible for PSLF. However, if you have other federal loans originated under the Federal Family Educational Loan (FFEL) program or the Perkins loan program, you have to consolidate those loans into a new Direct Consolidation Loan to qualify. You can learn more about what type of loan you have through the U.S. Department of Education’s Federal Student Aid website.

However, if you have a Perkins loan, consolidating federal loans may cause you to give up other benefits. Borrowers with Perkins loans should talk to their servicers about the risks associated with consolidation.

Step 2: Enroll and certify

Once you know which programs are best for you, early enrollment is critical to achieve the biggest savings. In order to benefit from the PSLF program you must:

  • Enroll in a qualifying payment plan. To qualify for and take advantage of PSLF, you need to enroll in an income-driven repayment plan. Income-driven repayment plans set your payment based on your income. This may reduce your monthly payment and may maximize the amount forgiven. To get started on an income-driven repayment plan application, contact your servicer or enroll online . While payments made under a 10-year Standard Repayment Plan are qualifying payments for PSLF, you will have to enroll in an IDR plan to take advantage of the PSLF program. Under a 10-year Standard Repayment Plan, you are likely to pay off the loans before you can qualify for loan forgiveness. Therefore, an income-driven repayment plan is your best option.
  • Certify that you work for a qualified public service employer. Use the Employment Certification for Public Service Loan Forgiveness form to keep track of your eligible employment and qualifying loan payments.

You will need your employer’s help to complete the certification form. Complete sections one and two on your own, then ask your employer to complete and sign section three before you submit the form. Some employers may already have an established process for submitting this form. You should check with your employer for more information.

Step 3: Follow up with your servicer

After the form is complete, make a copy and keep for your records. Then submit the completed and signed form to the address on the form, or if no address is listed, then to your servicer. Be sure to follow up. It is likely that the organization servicing your loan will change. Each year, you should resubmit the Employment Certification Form for Public Service Loan Forgiveness form so that you can keep track of your qualifying payments and make sure you stay on the road toward loan forgiveness.

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