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How to Apply for Student Loan Forgiveness In 2021

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Oct. 7 2021, Published 11:14 a.m. ET

The Public Service Loan Forgiveness (PSLF) program is going through a pivot. President Biden has introduced changes to the PSLF program that he hopes will increase its efficacy and approval ratings.

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Here's a rundown of what's changed, and how the estimated 600,000 borrowers it could affect can apply.

Biden's changes to the PSLF program

Students can now become eligible for eventual loan forgiveness under any repayment plan. Previously, the limitations for eligible repayment plans were stricter.

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According to the Department of Education, "Any prior payments made while working for a qualifying employer will count as a qualifying payment, regardless of loan type or repayment plan."

This makes it easier for students to maintain eligibility throughout their early careers in public service. Before, only income-driven repayment plans or 10-year standard repayment plans counted.

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Additionally, alumni can now access loan forgiveness on direct or non-direct federal student loans. The program only catered to borrowers with direct federal student loans before, but now, non-direct federal loans (including Federal Family Education Loans and Perkins loans) count. Also, whereas loan consolidation formerly restarted the clock for forgiveness programs with a set repayment period, pre-consolidation payments now count.

Payments that were formerly rejected for technicalities will be reinstated to help increase the number of loans forgiven (the Department of Education will conduct a months-long audit for this).

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Finally, military members and veterans get some easing. The Department of Education says it "will allow months spent on active duty to count toward PSLF, even if the service member’s loans were on a deferment or forbearance rather than in active repayment."

How to apply for loan forgiveness in 2021

People can apply for PSLF loan forgiveness via the Federal Student Aid website. Use the resources on the page to determine eligibility or go directly to the application. According to Federal Student Aid, PSLF loan forgiveness occurs "after you have made 120 qualifying monthly payments under a qualifying repayment plan while working full-time for a qualifying employer."

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People can apply for teacher loan forgiveness via the Federal Student Aid website. Use the resources on the page to determine eligibility or go directly to the applications. According to Federal Student Aid, "You apply for teacher loan forgiveness by submitting a completed teacher loan forgiveness application to your loan servicer after you have completed the required five consecutive years of qualifying teaching."

There's a time limit on expanded student loan forgiveness

Because Biden pushed the loan forgiveness expansion measures through using emergency executive authority, there's a time limit for updated forgiveness applications: Oct. 31, 2022. That's a little more than one year out.

Some forgiveness adjustments will happen automatically, while others will need to be actively adjusted by the borrower. Debt-carrying alumni must certify their employment or apply for student loan forgiveness by the deadline. If you're not sure whether to take action, it's best to check with Federal Student Aid and your loan servicer. Under the right circumstances, these changes could wipe out your student debt for good.

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