The Public Service Loan Forgiveness (PSLF) Program, established by law in 2007 and administered by the Department of Education, is intended to encourage individuals to enter and continue careers in public service by forgiving borrowers’ remaining federal student loan balances after they have made at least ten years of loan payments while working in public service and meeting other requirements. Only loans provided through the William D. Ford Federal Direct Loan (Direct Loan) program qualify for forgiveness. To date, there are over 890,000 individuals enrolled in the program. The first borrowers became eligible in September 2017. Out of the 19,000 applications submitted for loan forgiveness, just 55 had been approved at the time of this new General Accountability Office (GAO) study.
GAO found that the PSLF servicer, contracted to run the program for the Education Department, received little guidance on determining whether an employer qualifies, failed to receive notice of important policy changes made by the Education Department, and did not receive reliable and consistent information from the Department about borrowers’ loan payments from the other eight federal loan servicers. Borrowers, too, lack sufficient information to identify errors in their payments that could affect loan forgiveness. GAO also found that there was a profound need for clear and sufficient information about how to qualify for loan forgiveness. In its reply to GAO, the Department has decided to develop a manual for the servicer and the borrower to use for the program, although they could not provide a timeline.
Over 150 members of Congress have now written to Secretary DeVos at the Education Department urging her to turn over more information on PSLF and to swiftly act to solve the problems uncovered by the GAO. They were particularly disturbed to find that 99.6 percent of borrowers applying for loan forgiveness had been denied.
I know that some NTEU members are enrolled in the PSLF Program, and that this is an important program for federal employees who find themselves struggling to afford needed higher education while working on a public servant’s salary. Please be sure to check with your loan servicer or the Education Department to make sure your payments are being counted correctly. I will share more information as it becomes available.