government is looking to help offer student debt relief to thousands of public workers, including teachers, police officers and firefighters, which has led to the Department of Education announced big changes to the Public Service Loan Forgiveness program.
There were thousands of borrowers who went through the process of applying for loan forgiveness, but these were almost all rejected by the federal government.
Many people discovered after making a decade of payments that they had the incorrect type of federal loan or repayment plan to qualify for the program, so under temporary changes until October 2022, they will be able get their loans cleared.
System correction
These changes have been brought in to allow borrowers to correct errors and count payments that they had been making towards the program, while it is also tipped to shorten the time required for 550,000 borrowers to make payments to become eligible for loan forgiveness.
The changes that have been brought in will get rid of the debt of 22,000 borrowers for a total worth of $1.7 billion, and the government predicts that another 27,000 borrowers may see roughly $2.8 billion in debts wiped off if they can prove they were employed in one of the qualifying jobs.
Eligibility for student loan forgiveness
The Public Service Loan Forgiveness program was previously only available to people with certain types of federal student loans and specific repayment plans.
Until 2022, however, borrowers who have made 10 years’ worth of payments will be eligible for loan forgiveness, regardless of the type of federal student loan and specific repayment plan they had.
The qualifying jobs include people in positions in federal, state or local governments, a non-profit organization or the US military, with military members able to count time whilst on active duty towards their 10 years.
