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PSLF: Ten Years or 120 Payments?

Public Service Loan Forgiveness takes ten years, but the 120 certified payment requirement is much more accurate.

Written By: Michael P. Lux, Esq.

Last Updated:

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PSLF: Ten Years or 120 Payments?

Public Service Loan Forgiveness takes ten years, but the 120 certified payment requirement is much more accurate.

Written By: Michael P. Lux, Esq.

Last Updated:

Affiliate Disclosure and Integrity Pledge

When discussing Public Service Loan Forgiveness (PSLF), many borrowers get confused about the difference between ten years at an eligible employer and 120 certified payments.

Even though 120 payments add up to ten years, there some significant differences. The big fear for most borrowers is if they have to start over if they make a mistake.

This article will break down the time requirement for PLSF, including how changing employers, switching repayment plans and breaks in payments impact the clock.

Why 120 Certified Payments is More Accurate than Ten Years for PSLF

It isn’t wrong to say that it takes ten years to qualify for Public Service Loan Forgiveness.

However, it is more clear to say that qualifying for PSLF requires 120 certified payments.

This critical distinction goes back to the payment certification process. When a borrower submits an employer certification form, the loan servicer does a comprehensive review of the borrower’s account before certifying the payment. The PSLF loan servicer, MyFedLoan, will check to see that the borrower has eligible loans and is on an eligible repayment plan. If a requirement is missing, the payment does not get certified.

If you only focus on the ten years of public service requirement, you risk disappointment with the results of your PSLF application.

Changing Employers, Breaks in Payments, and Switching Repayment Plans

Many borrowers fear that if they start a new job, pause payments, or take a break from public service that they will have to start PLSF from scratch.

Fortunately, there is no consecutive payment requirement. As a result, borrowers can pause repayment, leave the public sector for a private company, and later pick up where they left off.

As long as the total certified payments add up to 120, borrowers can qualify for PSLF.

The Starting Over Risk

Even though payments don’t have to be consecutive, there is still a risk that borrowers might have to start from scratch on PSLF.

Consolidating Federal Student Loans – While there are many benefits to federal direct consolidation, one of the downsides is that it creates new loans and restarts the forgiveness clock.

Ineligible Loans or Repayment Plans – If a borrower isn’t on an eligible repayment plan or doesn’t have eligible loans, they won’t make any progress towards PSLF. Many borrowers think they are making progress but have to start over when they discover a major flaw.

Note for Borrowers on the Wrong Repayment Plan: If you discover that you were on the wrong repayment plan, there is a temporary federal program that can help.

Getting Payments Certified

The payment certification process is relatively straightforward. Borrowers need to complete this form and have it signed by their employer.

If you are looking for a guided application, the PSLF Help Tool is an excellent resource. The Department of Education created the PSLF help tool to aid borrowers in verifying employment eligibility. The PSLF Help Tool also assists borrowers in completing the necessary forms for certification.

How Often Should I Certify Payments?

There isn’t a requirement for payment certifications. Theoretically, a borrower could complete one employer certification after ten years.

However, waiting until ten years have been completed is a huge mistake. If there is an eligibility problem with the borrower’s loans or repayment plan, it would be devastating. Loan eligibility issues are often easy to fix, but it requires restarting the PSLF clock. Thus, waiting ten years may mean wasting ten years.

The best practice for borrowers is to certify payments when:

  • starting a new job,
  • leaving an old job, and;
  • getting married.

Additionally, borrowers should plan on submitting a certification form once a year at the minimum. Frequent certification is the best way to maximize PSLF forgiveness and avoid mistakes.

About the Author

Student loan expert Michael Lux is a licensed attorney and the founder of The Student Loan Sherpa. He has helped borrowers navigate life with student debt since 2013.

Insight from Michael has been featured in US News & World Report, Forbes, The Wall Street Journal, and numerous other online and print publications.

Michael is available for speaking engagements and to respond to press inquiries.

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