(NEXSTAR) – While Borrowers Wait a decision by President Biden on federal student loan debt, many are seeing their debt erased under a temporary waiver for a rebate program already in place. That includes thousands of Californians, according to recently released data.
US education officials have been encourage borrowers to consider applying for loan relief under the civil service loan relief program before the end of the relief.
The program, commonly called PSLF, aims to help some borrowers working in the public sector by canceling their federal student loans after 120 payments over 10 years. The number of applicants whose loans have actually been forgiven has been low – only 1 in 5 of the 1.3 million borrowers applying for debt forgiveness through PSLF are on track to see relief by 2026, according to a September report. report by the Center for the Protection of Student Borrowers.
Last year, the Department of Education implemented a waiver of specific PSLF requirements to grant borrowers credit for loan forgiveness, regardless of their federal loan type or whether they had been enrolled in a specific payment plan, provided they consolidate their debt into a direct loan. before the end of the exemption.
Since the waiver went into effect, more than 14,000 borrowers in California have seen more than $819 million in student debt erased under the PSLF waiver, Richard Cordray, the head of Federal Student Aid, shared tuesday. On average, this equates to over $58,000 per borrower.
You have less than three months to determine if you qualify for the PSLF waiver, which is currently about to expire after October 31, 2022. Here’s how.
As explained above, the PSLF aims to grant eligible civil servants debt forgiveness after a certain number of payments.
Eligible borrowers to have to:
- Be employed by a U.S. federal, state, local, or tribal government or nonprofit organization (federal service includes U.S. military service)
- Work full-time for this agency or organization
- Have direct loans (or consolidate other federal student loans into one direct loan)
- Make 120 qualifying payments
Under the current PSLF exemption, eligible borrowers can receive credit for payments made on other types of loans, under any payment plan, before consolidation or after the due date. . Those who have received the Teacher Loan Forgiveness can apply for the period of service that led to their PSLF eligibility, if they can certify PSLF employment for that period.
First, you’ll want to visit the FSA website and login to your account. You will be able to search for your employer in the FSA database and add information about your employment. Once you have found your employer, you will be able to see if they are eligible for the PSLF.
Then, according to SBPC Walkthrough Guide, you will need to determine the type of federal student loan you have. Direct loans are eligible for the PSLF while other loans must be consolidated into a Direct Consolidation Loan. Until the end of October 2022, previous eligible payments you have made on a non-direct loan will count towards the 120 necessary payments that PSLF requires for forgiveness.
Once you have completed the steps above, you will need to confirm your employment. You should then be able to submit your PSLF form.
The FSA has created a help tool to guide borrowers in filling out the form.
Who is eligible for already approved student loan forgiveness?
About 1.3 million borrowers nationwide have seen $26 billion in student debt forgiveness since President Biden took office.
In addition to the thousands of borrowers who have benefited from debt cancellation under the revamped PSLF program, another 690,000 borrowers saw a total of $7.9 billion in student loans wiped out by discharges due to borrower defenses and school closures. More than 400,000 borrowers have received more than $8.5 billion in debt forgiveness through total and permanent disability release.
Biden is should announce plans regarding a more widespread student debt forgiveness and possibly an extension of the loan payment pause in the coming weeks.