In comparison, the latest student loan debt statistics show that there are approximately 45 million student loan borrowers. How do you get student loan cancellation? The two best ways to get student loan cancellation are through an income-driven repayment plan and the Public Service Loan Forgiveness program.
Both apply only to federal student loans, involve requirements, and can take 10 years public service loan forgiveness or 20 to 25 years income-driven repayment plans. Most importantly, student loan relief has been extended until January 31, However, make sure you focus now on your strategy to student loan repayment.
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More From Forbes. Nov 12, , am EST. Nov 11, , pm EST. Eliminate barriers for military service members to receive PSLF. This change addresses one major challenge service members face in accessing PSLF. Service members on active duty can qualify for student loan deferments and forbearances that help them through periods in which service inhibits their ability to make payments. But too often, members of the military find out that those same deferments or forbearances granted while they served our country did not count toward PSLF.
This change ensures that members of the military will not need to focus on their student loans while serving our country. Federal Student Aid will develop and implement a process to address periods of student loan deferments and forbearance for active-duty service members and will update affected borrowers to let them know what they need to do to take advantage of this change.
Automatically help service members and other federal employees access PSLF. Military service members and other federal employees devote themselves to serving the United States, and we should make it as easy as possible for them to get PSLF. Next year, the Department will begin automatically giving federal employees credit for PSLF by matching Department of Education data with information held by other federal agencies about service members and the federal workforce.
To date, approximately , federal employees and 17, service members have certified some employment toward PSLF. These matches will help the Department identify others who may also be eligible but cannot benefit automatically, like those with FFEL loans. Borrowers who believe there have been errors in processing their PSLF application after the Department first conducts the internal and external reviews described above will be able to use an interim reconsideration process to receive a second individual review next year.
A permanent reconsideration process is under consideration in the negotiated rulemaking process. To further strengthen oversight of PSLF, the Department will improve its reporting on PSLF, including information on timelines for processing applications and results of servicer audits.
The Department wants borrowers to know about PSLF and help those who may be close to forgiveness take the steps they need to get relief.
Starting this fall, we will begin an extensive outreach campaign to make sure borrowers are better informed about this key benefit.
This will include emailing borrowers who have hit PSLF-eligible payments during the pause but need to verify their employment to receive forgiveness. ED will also notify borrowers about any additional payments we are able to automatically count and the option for reconsideration of denied applications, as applicable. We will also work to ensure that all potentially eligible borrowers are aware of the improvements to PSLF and tools available to them.
We can and should make it easier for borrowers to apply for PSLF. The agency will first loosen some of the rules that had prevented eligible borrowers from discharging their loans, via a limited waiver. The government, for example, will allow payments on any of a person's loans to count toward the total number required for forgiveness. Parent PLUS loans are not eligible under the limited waiver. The department said it would automatically credit borrowers who already have direct loans and have proved they work in an eligible field.
Others who haven't enrolled in the program or have ineligible federal loans will have to apply for forgiveness, which may require them to consolidate their loans. Borrowers will have until October to apply. To find out more about loan consolidation, visit StudentAid.
The Education Department also plans to review all Public Service Loan Forgiveness applications that had been denied and to give federal employees automatic credit toward forgiveness. Other changes will come about more slowly via regulations made by "rule-making," a lengthy and complicated bureaucratic back-and-forth between the government and other stakeholders. For more information, visit StudentAid. For a limited time, borrowers may get credit for past payments made on loans that would otherwise not qualify for the Public Service Loan Forgiveness program.
There are two requirements to receive additional qualifying payments: Full-time employment and loan consolidation. For instance, you must have worked full-time for a qualifying employer when prior payments were made, according to Federal Student Aid.
The administration will be relaxing key requirements that had restricted eligibility for PSLF to only certain types of federal student loans and certain repayment programs. The result will be a significant expansion of the program that could ultimately benefit nearly , student loan borrowers, according to the Department of Education.
The Department of Education has indicated that under the new changes, payments made under any repayment plan can now count as a qualifying payment towards PSLF. Previously, only payments made under an income-driven repayment plan or the year Standard repayment plan could count as a qualifying payment. Payments made under Extended repayment plans, Graduated repayment plans, and other fixed or level plans with terms greater than 10 years were excluded.
Now, payments made under these plans will count, as long as the borrower was working in qualifying PSLF employment at the time that the payment was made. Importantly, the changes are retroactive to the creation of the PSLF program in October of , but not before that date.
Most periods of non-payment including in-school deferments, hardship forbearances, and periods of default will still not count towards PSLF. The Department is also relaxing PSLF criteria that restricted eligibility to payments made on Direct federal student loans only.
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