If you are working towards Public Service Student Loan Forgiveness, there is only one real way to track your progress. In order to have your debt forgiven, you must make 120 certified eligible payments. Each payment that counts towards 120 gets you one step closer.
The key to tracking these payments is understanding what it means to be certified and what it means to be eligible. If you don’t meet both requirements, your payment will not count towards forgiveness.
What is necessary for a payment to be “eligible” for Public Service Student Loan Forgiveness?
There are two requirements for a payment to be eligible. First, the borrower must be on a qualifying repayment plan. Most commonly, borrowers elect to sign up for an income driven plan such as Income Based Repayment or Pay As You Earn. The government’s newest repayment plan Revised Pay As You Earn is also eligible. Examples of repayment plans that are not eligible would include graduated repayment and extended repayment. If you think you might be on the wrong repayment plan, contact your loan servicer immediately. There is no way to fix a repayment plan eligibility problem, even if you were paying more than necessary.
The second eligibility requirement is that the borrower be working for a public service employer. This term can be a little confusing for people who work less than full time for multiple employers, but for the most part, if you work for a government agency or for a not for profit 501(c)(3) organization, you are eligible. For full details on what employers qualify, be sure to check out the Department of Education’s Q and A on Public Service Forgiveness.
If you meet both the repayment plan and employer requirement, your payment will be deemed to be eligible.
What does it mean to be certified?
The certification process is very easy if you stay on top of it, but can be difficult if you procrastinate.
To have your payments certified, you simply need to fill out a form and have it signed by your employer. Typically, this is pretty easy to do.
Borrowers run into problems when they let years pass by without filling out the form. Getting an employer to certify your employment long after you left can be very tricky. For this reason, we suggest having your employer certify your public service employment on a yearly basis and whenever you change jobs. Trying to get in touch with old bosses can be difficult and awkward.
Another reason that yearly certification is a good idea is to verify that you are meeting all the eligibility requirements. You may think, or have even been told, that you are on the right repayment plan. However, if you later learn there was a mistake somewhere, your payments could all count for nothing. Sadly, this problem is all to common.
The Loan Discharge
Once you have made your 120 certified eligible payments, your student debt can be forgiven. Because the age of the program is not yet 10 years old, we have not seen anyone earn forgiveness, nor do we know what the final paperwork will look like.
At this time the best practice is to keep getting your payments certified so that you know you are on track.