Jason Edwards, a communications professor at Bridgewater State University in Massachusetts, learned seven years too late that he didn’t qualify for public service loan forgiveness. The Providence, Rhode Island, resident had been paying his debt for that long when the dreadful discovery arrived.
Yet Edwards’ story holds a rare, happy ending. Stay tuned.
The public service loan forgiveness program, signed into law by President George W. Bush in 2007, allows not-for-profit and government employees to have their federal student loans canceled after 10 years of on-time payments. In 2013, the Consumer Financial Protection Bureau estimated that up to one-quarter of American workers could be eligible for the relief.
These are the public service loan forgiveness requirements. Often, if you don’t meet one of them, you can make changes so that you do.
- Your loans must be federal direct loans.
- Your employer must be a government organization at any level, a 501(c)(3) not-for-profit organization or some other type of not-for-profit organization that provides public service.
- By the end, you need to have made 120 qualifying, on-time payments in an income-driven repayment plan or the standard repayment plan.
Yet, like tens of thousands of other people who work in public service and carry student debt, Edwards had unwittingly not met one of the technical requirements all those years.
The program’s problems are complex. Lenders have failed to provide consumers with full, accurate information about the option. And the student loan system is famously complicated. There are some 14 ways to repay your education debt, a web of forgiveness options and a soup of wonky terms such as “forbearance” and “deferment.”
To qualify for public service loan forgiveness, you need to be enrolled in one of a few income-driven repayment plans. Unfortunately, Edwards had been paying his loans back in an extended repayment plan, and, as a result, none of his payments had qualified.
“It’s painful,” Edwards, 45, said. His monthly bill at the time was $421.
After learning that his payment plan didn’t qualify in 2015, he moved into one that did, and restarted his 10-year-journey.