Thursday, May 11, 2023

The US has approved $42 billion in loan forgiveness for public service workers.

By ADRIANA MORGA and CORA LEWIS
yesterday

 In this June 27, 2020, file photo, Saltillo High School seniors make their way to the football field as the sun begins to set for their graduation ceremony in Saltillo, Miss. Federal parent PLUS loans have become a last resort for many lower-income families paying for a kid’s college education. Today, parent PLUS loan debt totals $108.5 billion among 3.7 million borrowers, and the average borrower owes more than $29,000. (Thomas Wells/The Northeast Mississippi Daily Journal via AP, File)

The U.S. has approved more than $42 billion in federal student loan debt forgiveness for more than 615,000 borrowers in the past 18 months as part of a program aimed at getting more people to work in public service jobs, the U.S. Department of Education said this week.

The Public Service Loan Forgiveness program is open to teachers, librarians, nurses, public interest lawyers, military members and other public workers. It cancels a borrower’s remaining student debt after 10 years of public interest work, or 120 monthly payments.

The program is separate from President Joe Biden’s student debt relief plan, which would wipe away or reduce loans for millions of borrowers regardless of what field they work in. The U.S. Supreme Court is currently considering whether that plan can go ahead.


The Public Service Loan Forgiveness program, known as PSLF, was launched in 2007, but stringent rules meant that more than 90% of applicants were rejected, the Department of Education said in 2019.

In October 2021, the government temporarily relaxed the requirements, making it easier for people to apply and be approved. Those relaxed requirements ended in October 2022. However, borrowers who want to increase their payment count have another opportunity to do so. They can apply for the one-time account adjustment until the end of the year.


Through the one-time account adjustment, borrowers with direct loans through the William D. Ford program will have similar benefits to those that were available under the limited PSLF waiver. Borrowers who do not have direct loans can consolidate and receive PSLF credit for prior payments as part of this adjustment, as long as they submit a consolidation application by the end of 2023.

One of the people who benefited from the PSLF waiver was Beth Bourdon, an assistant public defender in Orlando, Florida.

Bourdon had about $57,000 of student loans forgiven in February 2022. Previously, because her loans had been acquired through the Family Federal Education Loan Program, Bourdon didn’t qualify for relief. But when the waiver took effect in October 2021, she successfully applied.

“I kept checking and re-checking the site, and one day I went and the balance was zero,” Bourdon said. “Two days later I got the official letter.”

With the exception of one two-year period, Bourdon has worked in public interest law since 2005. She said she made payments of about $417 every month from June 2008 to October 2021, when she consolidated her loans and applied for PSLF.

“Public defenders, we don’t get paid a lot,” she said. “When people’s student loans hit, they’re faced with a really hard decision. Can I remain doing this job I love or will I have to go to a civil firm to try to make money? The PSLF helps try to retain talented people who would otherwise go somewhere else.”

Bourdon said the cancellation gives her “breathing room.”

She added that she personally talked about 10 people she knows through the process of applying for forgiveness via the waiver, and that several have already received cancellation.

“It’s so great — knowing how relieved I was, for my friends to have that kind of relief too,” she said.

Starting July 1 of this year, the Education Department will implement changes designed to make the PSLF application process easier. Some of the changes were previously included in the waiver.

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