6 Things to Know About Public Service Loan Forgiveness During COVID-19
The COVID-19 payment pause and 0% interest rate for federal student loans will end May 1, 2022. Check StudentAid.gov/coronavirus for the latest updates.
Read on to find a brief roundup of what you need to know about how the payment pause affects Public Service Loan Forgiveness (PSLF) and Temporary Expanded Public Service Loan Forgiveness (TEPSLF).
Monthly Payments Are Paused
- have Direct Loans that are not in default, and
- work full-time for a qualifying employer during the payment suspension,
you can earn credit toward PSLF and TEPSLF as if you continued to make regular monthly payments. You can think of them as $0 payments. The only thing you need to do is submit the PSLF and TEPSLF Certification and Application (PSLF form) to get qualifying payment credit.
You can get a refund for any payments you make during the payment pause (March 13, 2020, through May 1, 2022). Even if you get a refund, that month still counts toward PSLF, as long as all other qualifications are met. Just call your servicer to ask for a refund.
Applying for PSLF and TEPSLF
You can still apply for and get forgiveness if you reach your 120 qualifying payments during the payment pause. If you’re eligible for forgiveness, the amount forgiven will be the principal and interest that was due after you made your 120th qualifying payment. Learn about eligibility requirements for PSLF and TEPSLF.
Reduced Work Hours Could Impact Your Eligibility
You must continue to work full-time for a qualifying employer to have the suspended payments count toward PSLF. Full-time means either 30 hours a week or what your employer considers to be full-time, whichever is greater. You can meet the full-time requirement by being employed part-time for multiple employers, but they must all be qualifying employers.
If you no longer work full-time for a qualifying employer or lost your job, your suspended payments will not count toward PSLF. But you don’t lose your eligibility for PSLF entirely. If you later meet the qualifying employer and full-time status requirements, payments you make at that point will count toward PSLF. Those new qualifying payments can be added to the count of qualifying payments you had before you lost your job or full-time status.
Additional Payments Will Reduce Your Amount Forgiven
In most cases, it’s a good financial strategy to make additional payments while interest is set at 0%. If you are seeking PSLF, however, additional payments may not be in your best interest.
If you make payments during the payment pause, they won’t make you eligible for PSLF sooner. The suspended $0 payments already qualify toward your required 120 PSLF payments. So not making additional payments maximizes the amount you can get forgiven.
Getting Credit During the Payment Pause
On Oct. 6, 2021, ED announced a change to PSLF program rules through Oct. 31, 2022. During this period, you can get PSLF credit for payments you’ve made on loans that normally wouldn’t qualify for PSLF. Find more info about this limited PSLF waiver.
The best way to confirm you’re meeting PSLF requirements is to submit your PSLF form annually. Use the PSLF Help Tool to complete your PSLF form. Print it, sign it, have your employer sign it, and submit it to FedLoan Servicing. Keep the signature requirements in mind before submitting your form.
Read our article about how to use the PSLF Help Tool for more tips.
Are you a borrower with a Direct Loan and FedLoan Servicing is already your servicer? You can submit your PSLF Form to FedLoan Servicing online! Submitting online is faster than submitting by mail.
Keep an Eye on Your IDR Plan Recertification Deadline
It’s important to recertify on time so that you stay on your IDR plan. If you aren’t on an IDR plan, payments you make after the payment pause ends won’t count toward PSLF.
But you don’t have to recertify your income before the end of the payment pause. As part of the payment pause, your recertification date has been delayed. Your servicer will reach out to let you know when you’ll need to recertify. Be on the lookout for an email or letter to make sure you don’t miss your deadline to recertify.
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Consider what your situation will be when repayment restarts. You might want to recertify early. If you recertify, your new payment amount will begin after the payment pause ends. If you would like to recertify during the payment pause, contact your loan servicer.
Remember to Avoid PSLF Scams!
There is no fee for the payment pause and other federal student loan benefits—not from the federal government and not from your loan servicer. If someone asks for money to suspend payments on your loans or help you apply for PSLF (for example), it’s a scam. Learn to avoid student aid scams.
This article was written by Miranda H., a Digital Engagement Strategist at the U.S. Department of Education’s office of Federal Student Aid. As a public servant with federal student loans, she is passionate about increasing awareness around the PSLF program to improve the overall experience for people like her.