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What you need to know about public service loan forgiveness

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NEW YORK (AP) – More than 145,000 American borrowers have canceled their student loan balances through…

NEW YORK (AP) — More than 145,000 U.S. borrowers have had their remaining student loan debt canceled through the Public Service Loan Forgiveness Program, and officials say many are more likely to qualify.

The Public Service Loan Forgiveness Program, launched in 2007 to send more graduates into public service, cancels the remainder of a borrower’s federal student loan debt after they make monthly payments for 10 years of community service, or 120 monthly payments for any length of time. when performing social activities.

The program, launched in 2007 to send more graduates into public service, cancels student debt after 10 years of community service or 120 repayments. Teachers, librarians, nurses, public interest lawyers, military personnel, and other government workers can apply.

The US Department of Education has eased the complicated rules for applying for the program, but only until October 31. Here’s what you need to know if you want to apply:

WHO QUALIFIES?

If you work or have worked for at least 30 hours a week in the following types of organisations, you are entitled to:

— Government organizations of any level (federal, state, local or tribal). This includes the US Army, all public education jobs, and full-time volunteer work with AmeriCorps and the Peace Corps.

— Any nonprofit organization that is tax-exempt under Section 501(c)(3) of the Internal Revenue Code.

— If you work for a non-profit organization that is not tax-exempt, you can still qualify for PSLF if the organization provides certain types of public services, such as emergency management, legal aid and legal services, early childhood education, disability services or the elderly, public health, including nursing and nursing, public and school library services, and public safety, such as crime prevention and law enforcement.

To demonstrate that your public service work qualifies you for a waiver, you must fill out an employer certification form to your service provider that lists the jobs you’ve held.

You must have Direct Loans or consolidate other federal student loans into a Direct Loan. You must also make 120 qualifying payments or 10 years of payments.

You can apply before you make 120 payments, and the Department for Education recommends that anyone eligible for the program applies before the grace period ends on October 31, regardless of how many payments have been made.

WHAT STUDENT LOANS ARE ACCEPTED?

Any federal student loan obtained through the William D. Ford Federal Direct Loan Program is eligible.

If you have a Federal Family Education Loan (FFEL) or a Federal Perkins Loan, you will need to consolidate them into Direct Loans with your servicer.

Private student loans are not accepted.

HOW TO SUBMIT AN APPLICATION?

You must apply by October 31st. You can still apply after that, but the canceled rules only apply until then.

HOW CAN I CONSOLIDATE MY DIG INTO A DIRECT LOAN?

First, visit studentaid.gov to see if you have loans under the Federal Family Education Loan or Perkins Loan program. These are the loans you consolidate.

Then submit your application online, by mail or fax to FedLoan Servicing. The process is free and takes about six weeks, but you can submit a loan forgiveness form to Public Services before or after the consolidation is complete.

WHAT IS CONSIDERED A QUALIFICATION FEE?

The relevant monthly payment is the payment you made after 1 October 2007 when you were employed by the relevant employer.

Any months of suspension of payments during the pandemic count towards the total payment amount.

Forbearance periods of 12 consecutive months or more, or 36 months cumulatively or more, count toward waiver.

Months spent in deferment before 2013 count towards the exemption.

In addition, the Department of Education will include an economic hardship deferment on or after January 1, 2013.

The 120 qualifying monthly payments do not have to be consecutive. For example, if you have a period of work with a non-qualifying employer, you will not lose credit for previous qualifying payments.

HOW CAN I APPLY FOR THE LIMITED WAIVER PROGRAM?

There is no separate application process for participation in the waiver program. Exceptions to the waiver will be in effect for applicants who have completed this process through the end of October.

HOW MANY PEOPLE ARE IN THE PROGRAM NOW?

As of May of this year, 715,675 people have processed completed forms to participate in the program. According to the data of the Department of Education, 61.9% of borrowers work in state institutions, the rest – in non-profit organizations. The average amount of debt forgiven under the program is $64,968.

WHO CAN I CONTACT IF I HAVE QUESTIONS?

If you have a specific question about your application, it is best to call or email a representative.

For general student loan questions, the Federal Student Aid Information Center (FSAIC) hosts a contact center that allows borrowers to chat, call, or email.

For specific questions about the program, applicants may contact FedLoan Customer Service at 1-855-265-4038.

The Student Borrower Advocacy Center has compiled a list of resources available in every state in the country.

WHERE CAN I FIND MORE INFORMATION?

Government agencies and private organizations are currently holding several online and in-person events to help applicants succeed in the program.

Every first week of each month, the Public Service Loan Forgiveness Coalition hosts a webinar on frequently asked questions about the program. Candidates can also access past webinars on the coalition’s website.

The AccessLex Institute hosts a Webinar “How to Benefit from Limited Public Service Loan Forgiveness” several times a month. The 30-minute sessions walk applicants through the process and answer frequently asked questions. This event is free.

The National Education Association has several PSLF webinars on YouTube that cover how to apply for the program and frequently asked questions.

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The Associated Press receives support from the Charles Schwab Foundation for educational and explanatory reporting to promote financial literacy. The independent fund operates separately from Charles Schwab and Co. Inc. AP is fully responsible for its journalism.

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This story was first published on July 6, 2022. It was updated on July 8, 2022 to correct that borrowers can get the rest of their loans after they have made monthly payments for 10 years, doing community service, or completing 120 monthly payments during any period of time during the performance of community service.

Copyright © 2022 The Associated Press. All rights reserved. This material may not be published, broadcast, written or distributed.

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