Student loan forgiveness requires a decade of carefully recorded payments, hours of waiting at your servicer, and endless patience. However, success comes without much fanfare.
Public defender Shelly Tomtschik was in court when she received the email informing her the search was over:
“Congratulations! Upon final review of your Public Service Loan Forgiveness (PSLF) application and payment history, we have determined that you have successfully made the required 120 monthly payments to forgive the loans listed below.”
“It didn’t hit me,” says Tomtschik, 40, of Baldwin, Wisconsin. “I thought it was more official or something.”
Tomtschik is one of the first federal borrowers to have their loans terminated tax-free by the federal government Government loan forgiveness Program. Launched in 2007, the program forgives any outstanding balance after 120 qualifying payments to borrowers who traditionally take lower-paying government jobs.
But the process is tricky. Only 864 of the 88,006 applications submitted were approved as of March 2019, based on the latest available Department of Education data. Average amount awarded: $59,244.
What it takes to get a public student loan forgiveness
To qualify for PSLF, borrowers must make 120 monthly payments on time while working full-time in the public sector for a qualifying employer. You must also:
Make sure you only have federal direct loans. Some borrowers have to consolidate into a direct loan. Personal loans are not eligible.
Sign up for an income-based repayment plan. Your payments will be part of your discretionary income.
Make sure your loans are serviced by FedLoan Servicing, the only company that processes PSLF applications. You can do this by submitting an employer attestation form.
Apply while still working for a suitable employer.
Tomtschik and another successful applicant, Bonnie Svitavsky, a Washington State librarian, might add another requirement: document everything.
Svitavsky, a 38-year-old senior librarian at Pierce County Library, made payments for two years before realizing they would not count against the PSLF. That’s because their loans weren’t included in an eligible repayment plan.
“It was disappointing to say the least,” she says.
To avoid future surprises, Svitavsky set alerts to submit certification forms and logged the details of calls to FedLoan.
“It felt crazy, but it was useful to go back and see that I had those conversations,” she says.
Tomchik did not submit any employment certificates for five years, although most of the payments were credited to her. But once she started, she saw the benefit: making sure every payment counts.
“Make sure you do the annual certification so if there’s a discrepancy in the number of eligible payments, you take care of it immediately, rather than trying to go back,” says Tomtschik.
More than half of PSLF applications were denied because they did not meet the number of qualifying payments, according to the Department of Education. Some of the other reasons are missing information (25%), ineligible credit (16%), invalid employment data (2%), or an ineligible employer (2%).
Read the rules – all of them
For another requirement, Tomtschik and Svitavsky could make a good argument: pay attention to the details.
Before filing her first certificate of employment form, Tomchik made additional payments of up to $800 to pay off $70,000 in debt. “I was willing to do anything just to get over it,” she says.
But making more payments won’t help you reach 120 qualifying payments faster. When Tomchik started working for PSLF, she stopped sending additional payments.
When Svitavsky learned about a new program — Temporary Expanded Public Service Loan Forgiveness — she realized forgiveness could come sooner than she thought. It is a $350 million allocation for borrowers who met all of the criteria for PSLF but made payments under the wrong plan.
This meant that the two years of payments that had not counted toward Svitavsky’s forgiveness were now possible. She applied last fall, was rejected, and had to contact FedLoan to say she thought she qualified (this is a required exercise when applying for the temporarily expanded program). In the spring, after months of wrestling, she finally won forgiveness.
The headache is worth the payoff
When Tomchik’s loans were forgiven last spring, her balance was $86,200 — $16,000 more than she originally borrowed.
“I’m glad to know it’s gone. My husband still has some student loan debts that we will pay off at some point,” says Tomtschik.
Svitavsky, meanwhile, says she has been forgiven $80,971 of her original $97,115 debt. Between submitting her first certification form in 2013 and being forgiven in April 2019, she paid nearly $20,000 in interest and less than $7,000 to the principal.
“It was this weird long blur,” says Svitavsky.