In 2007, former President George W. Bush signed into law the Public Service Loan Forgiveness program, which grants loan forgiveness to people who work at non-profits or in the public sector once they’ve made payments for10 years—or at least that’s what it’s supposed to do. Unfortunately, many borrowers have found the program to be a janky, disorganized whirlwind of confusion and disappointment ever since 2017, the first year that loan recipients would have been eligible for forgiveness.
On Wednesday, the US Department of Education announced changes amounting to a full overhaul of the program that will hopefully have it running more smoothly, particularly for those who have been denied loan forgiveness for various nonsensical reasons.
According to CNN, borrowers have, for years, criticized the program as being difficult to navigate, and many of them were informed they were not eligible after making what they thought were qualifying monthly payments for a decade. Why were they denied? Well, most of them couldn’t tell you because the system has been just that incomprehensible and lacking in transparency.
But while borrowers have lost confidence in the program, the Education Department is pledging to “restore the promise” of the debt relief program through a series of adjustments that will be implemented “over the coming months,” according to an agency memo.
Through October 31, 2022, the department will offer a waiver authorizing “all prior payments” from student loan recipients to be counted towards the loan forgiveness program even if the loan types and payment plans didn’t previously qualify as long as the borrowers are non-profit or government workers.
“This Limited PSLF Waiver will apply to borrowers with Direct Loans, those who have already consolidated into the Direct Loan Program, and those with other types of federal student loans who submit a consolidation application into the Direct Loan Program while the waiver is in effect,” the memo states.
The department will also be conducting internal reviews to investigate why borrowers were previously denied forgiveness as well as external reviews of how the loans are processed within the program. According to CNN, the department said this “will help identify and address servicing errors or other issues that have prevented borrowers from getting the PSLF credit they deserve.”
There’s also some good news in there for federal employees and military service members as the program overhaul reportedly includes provisions to give them better access to loan forgiveness eligibility.
“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,” the agency said in its memo which also stated that “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.”
Other than all that, the department is simply promising to make the program more user-friendly and easier to understand.
Because the last thing people need is a student loan forgiveness program that one would need to take out a student loan in order to get the education needed to understand it.