The United States Department of Education announced on Wednesday a review of the Public Service Loan Forgiveness Program (PSLF) that it will implement over the next year, with which 22,000 borrowers who have consolidated loans, including previously ineligible loans, will be eligible for receive a $ 1,074 million forgiveness without the need for additional action on your part.
The Department noted that another 27,000 borrowers could qualify for an additional $ 2,082 million forgiveness if they certify additional periods of employment. In total, the institution estimates that more than 550,000 borrowers who have previously consolidated will see an increase in qualified payments and the average borrower will receive another two years of progress toward forgiveness.
“Borrowers who dedicate a decade of their lives to public service should be able to trust the promise of public service loan forgiveness. The system has not kept that promise to date, but that is about to change for many borrowers who have served their communities and country”Said the Secretary of Education of the United States, Miguel Cardona.
The changes include:
A limited exemption from the PSLF which allows all student borrower payments to count towards the PSLF, regardless of the loan program or repayment plan.
This exemption will allow student borrowers to count all payments made on loans from the Federal Family Education Loan Program (FFEL) or the Perkins Loan Program.
It will remove restrictions on the type of repayment plan and the requirement that payments be made in full and on time for all borrowers. To receive these benefits, borrowers must submit a PSLF form before October 31, 2022, which is a one-time application used to certify employment and evaluate a borrower for discharge.
Borrowers who currently have FFEL, Perkins, or other Non-Direct Loans will benefit from this limited exemption by applying for consolidation in the Direct Loan Program and submitting a PSLF form by 31 December. October 2022.
The Department of Education indicated that by including borrowers eligible for immediate discharge under these actions, the Biden-Harris Administration has approved more than $ 11.5 billion in loan repayments for more than 580,000 borrowers.
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Eddie is an Australian news reporter with over 9 years in the industry and has published on Forbes and tech crunch.