Borrowers Can Refinance Federal Student Loans to Benefit from PSLF
Apply by Oct. 31
One of the barriers to a diverse and well-prepared educator workforce is the high cost of college and student loan debt. Research has found that higher debt burdens are associated with students avoiding public service jobs, particularly in the education field.
To encourage highly qualified individuals to become teachers or serve in other public sector jobs, the federal government created the Public Service Loan Forgiveness program in 2007, which eliminates any remaining federal student loan debt for those individuals that make 120 qualified payments while working for a qualified non-profit employer.
Unfortunately, the program has not worked as well as intended. Coupled with the uncertainly caused by the pandemic, the federal government paused the repayment requirements for most federal student loans. In addition, the government announced that borrowers would receive credit for past periods of repayment that would otherwise not qualify for PSLF. But to qualify, borrowers have to refinance their loans into a Direct Consolidation Loan by October 31, 2022. AACTE recently participated in a webinar sponsored by the Department of Education, which explains the temporary changes to the PSLF program that will allow more federal borrowers to have their loans eliminated.
The deadline to refinance loans is rapidly approaching. AACTE encourages those who have not filed for the revised PSLF program to do so before October 31 and those that have unsuccessfully applied to try again. As AACTE, and others, suggest, “When in doubt, fill it out.”