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Public Service Loan Forgiveness Program
June 16, 2017
6:39 pm
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I had 3 Direct Stafford Loans, which I refinanced into a Consolidation Loan. Unbeknownst to me, an FFEL Consolidation Loan. As I have recently discovered, FFEL loans are not eligible for the PSLF program. I've now been paying on it ten years, and was just starting to get excited that my loan would be forgiven, as I've been in public service the last 10 years.

Do you see any recourse I could take? I don't understand how it even happened in the first place - how do Direct loans become non-Direct loans?!?! I'm just flabbergasted that it could have even happened. *insert frustration here* At this point, I only have about $4,500 left, so refinancing into a Direct Consolidation loan makes no sense. Just thought I'd see if anyone else has faced a similar situation. Thanks!

June 18, 2017
1:40 am
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Indiana
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A bunch of people are in the same boat as you... from the looks of the Department of Education's stats, about 1 out of 3 certification applications are being rejected.

A number of people have posted similar issues in this forum and I'm not personally aware of any recourse. The current administration has also proposed eliminating PSLF, so odds are pretty good that they won't be taking any steps to help out borrowers in your situation.

Having only $4,500 is definitely a positive. This issue often shows up for people who have over ten times more debt than you.

I wish I had better news, but I don't.

July 19, 2017
1:47 pm
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I would be thrilled to only owe $4500. I still owe over $92,000 because my loans were put in the FFEL. Between 1995 and 1998 I took out $80,567 in William D. Ford Federal Direct Loans to pay for law school, Sallie Mae was the servicer of my loans. On July 26, 2002, Sallie Mae transferred all of my Direct loans into the Federal Family Education Loan (FFEL) program for unknown reasons. On approximately October 2007 I became aware of the Public Service Loan Forgiveness Program (PSLF) I immediately contacted Sallie Mae to ask if my loans qualified and they assured me they did, I knew I had taken out Federal Direct Loans and I was in an income based plan. The PSLF info said if you took out William D Ford Direct Loans you are good! And that is exactly what I did so I thought I was good. I estimate I have paid back $84,000 on my original $80,567 loans and I still owe $92,634. I should be near forgiveness but instead I still have years to pay because Sallie Mae (Now Navient) deceived me. I didn't consolidate them BACK to Direct loans until 2011. I paid 10 years for nothing basically. Very frustrated.

August 8, 2017
9:56 am
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I've seen so much turmoil caused by PSLF that I wonder if the initial excitement I felt in finding this program is 100% unfounded.

In a nutshell, I'm seeking advice on if I should exit PSLF and try to pay off my debt in the more traditional way. Since this is such a big jump, I wanted to reach out to those who may have also considered taking this step. Here is my situation:

The pros: I've only been enrolled in PSLF for one year, and I am open to the idea of leaving my job at a 501c3 nonprofit. My living expenses are currently very low and I have almost no personal/credit card debt.

The cons: My public student loan debt totals $108k. Last year I had some family and employment issues which led to me entering temporary forbearance, so my accumulated interest is about $2300. My current job in the public sector only has an income of <$37k annually. My boyfriend also has around $100k (currently deferred) in debt and we've discussed putting off getting married because of issues with consolidated partner debt.

Should I leave PSLF behind and get a job in industry? Is it realistic to expect I can still pay this off in 10 years? I'm hoping for freedom in making life decisions without the anxiety that comes with these loans on my back.

Thanks in advance for any and all advice!

August 8, 2017
10:25 am
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Indiana
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I have a couple thoughts.

1) Have you certified your one year of PSLF yet? More than 1 in 3 applications are rejected, so you should first make sure that you have the right loans, repayment plan, and employer. The only way to do is this to submit the employer certification form.

2) The higher salary on the private sector can definitely be tempting. If possible I'd suggest calculating how much PSLF will save you over the next nine years. I used an online loan repayment calculator and found that to pay off your balance of 108k, assuming 6% interest, it would cost about $1,300 per month to pay it off in nine years. If the private sector will only pay an extra $500 per month, moving on might be a bad idea, but if you can make an extra $2,000 per month, it could pay to go to the private sector.

Obviously this isn't a purely financial decision, but I think it helps to consider the loan forgiveness value as a benefit to the PSLF eligible job so you can do more of an apples to apples comparison.

August 14, 2017
1:48 pm
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Same situation as many others - paid for 14 years assuming my loans were Direct Consolidation since that's the ONLY thing shown on my Navient profile. Just found out I have to start all over because I found out after all this time they were FFEL. Navient had many, many conversations and documentation showing I wanted to stay on IBR and apply for PSLF yet they never mentioned any of that to me. Let me fill out forms wrong and never stated anytng to the contrary. My $33K loans (I've been paying on since 2004) have grown to $76K and now starting all over. I assume Navient will be paid by FedLoan all that money and then FedLoan will keep me paying another ten years so that will balloon with interest to probably over $100K and THAT's what the American taxpayer will forgive? I'll be over retirement age when this is all done.

August 14, 2017
1:54 pm
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Indiana
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The issue with the FFEL loans is definitely a major problem. If you want to take some sort of action against Navient I'd encourage you to file a complaint about what happened with the Consumer Financial Protection Bureau. You can learn more about the complaint process here: http://studentloansherpa.com/f.....n-company/

I don't think it is very likely that filing a complaint will help with your situation, but it can help shed light on a major problem and allow the CFPB to do something about it. In fact, they already have a lawsuit going with Navient and the results have been promising so far: http://studentloansherpa.com/c.....se-update/

August 15, 2017
12:19 am
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Yes, I filed with CFPB. There is also an attorney in Chicago that is investigating this issue. Navient is very sneaky with where they eliminate pertinent information. It took me three Federal Student loan.gov sites (all looking alike) to find out that I actually did have FFEL loans. I've gotten to where in addition to taking detailed notes when I talk to them, I screenshot their webpages and even record phone calls. I don't think PSLF was ever meant to actually be paid. I'm just hoping FedLoan will get my loan transferred soon before October 1st as things seem to change with October 1st dates. I don't want to get eliminated again from a sudden law change.

August 15, 2017
12:21 am
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Indiana
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What is the significance of October 1st?

August 16, 2017
12:11 am
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The first applications come online on September 1, 2017 with first PSLF loans forgiven starting October 2, 2017.