What is the Public Service Loan Forgiveness Program?

PSLF, or Public Service Loan Forgiveness Program, is a program that forgives outstanding student loan debt for certain borrowers after 10 years of regular payments.

After these 120 regular payments are made, all remaining interest and principal are waived and the student loan is considered paid in full. If you have a deferment or forbearance during that 10-year period, those missed payments are not counted, so it would take longer than 10 years to get to the 120 payment total.

Only direct federal loans qualify for the Public Service Loan Forgiveness Program, and you must be employed full-time (more than 30 hours per week) at a public service organization. This includes government jobs or a 501(c)(3) nonprofit organization. Teachers also qualify, even if they are contracted only 8 out of 12 months per year, as long as they work full-time during the school year.

Anyone who wishes to benefit from PLSF should also apply for the income-based repayment (IBR) plan, which adjusts your monthly payments based on your income and family size.

You can find the relevant forms to apply for PLSF at the Federal Student Aid site.

Since you must make all of your payments on time and in full on the Public Service Loan Forgiveness Program, we urge all student loan borrowers to be careful about accruing other debts. Default or delinquency on your student loans will disqualify you for PLSF and other kinds of student loan aid.

We can help by lowering and consolidating your credit card debt payments, accelerating your credit debt payoff, and freeing up income to apply to student loan debt.

Call us today for a free, confidential counseling session. Our certified nonprofit debt counselor will help you create a budget you can live with and a plan to pay off debts within five years. With those debts out of the way, paying off student loans will be much easier.

Photo: cybrarian77 via Flickr CC

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