The Department of Education deserves a lot of credit for the PSLF Help Tool. It is an excellent resource for borrowers and extremely helpful for borrowers preparing PSLF applications.
However, the help tool is not without flaws.
One of the most significant issues with the PSLF Help Tool is the “Likely Ineligible” language that pops up for many borrowers once they input their employer’s information.
A Scary Message
Upon entering their employment information, many borrowers see the following warning about their employer:
This looks like bad news. Clicking for an explanation doesn’t help the situation. Borrowers looking for clarification see this notice:
Fortunately, the ominous signs don’t mean doom for the borrowers hoping for PSLF.
What “Likely Ineligible” for Public Service Loan Forgiveness Actually Means
If your employer is “likely ineligible” according to the PSLF Help Tool, it usually just means that they don’t have your employer in the database.
In other words, it isn’t good news or bad news. They just need to review your employer to verify eligibility.
If you work for a smaller non-profit or a small government agency, a likely ineligible warning should be expected, especially if you are the first person in the office to pursue PSLF.
Sherpa Tip: Don’t assume you are not eligible for PSLF just because the help tool says your employer is likely ineligible.
We’ve received emails from multiple borrowers ready to give up on PSLF because of this warning.
If you believe your employer is eligible, send in an application.
Eligible Employers in the PSLF Help Tool
If you see this green checkmark next to your employer, it is a good sign:
An “eligible” employer is one that has previously been verified. Once an employer falls into the eligible category, PSLF certifications are processed quicker.
A Note About “Not Eligible” Employers
The PSLF Help Tool may state that your employer is not eligible.
If you see this warning, it is bad news:
An employer is given “not eligible” status if they have been reviewed, and it was determined that the employer does not qualify for PSLF.
If you believe that the previous determination was an error, simply submit a new application with this employer. It will trigger a new review of employer eligibility and may lead to a new finding.
How to determine if your employer is a 501(c)(3) charitable organizations. I went to the website below and they are not listed. Is there any other way to know?
Veteran’s evaluation services (VES)
https://apps.irs.gov/app/eos/
The best thing you can do is to complete an employer certification form.
What if my employer doesn’t qualify but I complete the 120 payments, do I qualify for PSLF?
If your employer is not eligible for PSLF, then the payments will not count toward the required 120. For a payment to count, it must have happened while you were employed by an eligible employer.
If you can’t qualify for PSLF, you might also want to look into IDR forgiveness. It takes longer, but there isn’t an employer requirement.
What about “Undetermined” after previously being “Likely ineligible?” Dies that mean someone is actively reviewing to determine eligibility? How long does this usually take?
Processing times are all over the place with everything going on.
I’d remind you that the help tool is only to give you an idea of eligibility. It is not the final say. If you think you might be eligible for PSLF, submit an application and find out for certain.