Student Loans – About Public Service Loan Forgiveness
If you’re a student loan borrower, you probably dream of the day you’re debt-free. For those who qualify for federal student loan forgiveness, this day could come sooner than they even imagine. To be qualified for any student loan forgiveness program, it’s crucial that your loans aren’t in default, which means they haven’t gone unpaid for more than 9 months. In general, there are 4 basic programs that can reduce or cancel federal loan balance and the qualification depends on the repayment plan you pick and your job. This time, I’ll introduce you to the public service loan forgiveness.
How does it work? If you work for the government or a nonprofit organization for at least ten years, remaining federal loan balance could be forgiven. Nurses, firefighters, military personnel and teachers qualify for public service loan forgiveness, among others. The best way to save money on this forgiveness program is to repay loans on an income-driven plan for these ten years. Although only federal student loans are eligible for public service loan forgiveness, there’s a possibility to consolidate other student loan types and to repay them all on this program. If, however, you qualify for Perkins Loan Cancellation, I would suggest you to keep your Perkins loan separate.
Public Service Loan Forgiveness is best for people who already plan working in public services for this period of time (ten years at least) and who are already on an income-driven repayment plan. Simply put, it’s worthwhile only for people who actually plan to pursue a career in public service, because it is really a big commitment.
To apply for Public Service Loan Forgiveness, call the student loan servicer that manages your federal loan. Let them know that you are interested in this program and ask for their confirmation you qualify for it. You’ll get information on consolidating your federal loans and about the required paperwork. Together with your employer, you need to fill out the employment certification form every year and/or when you change your job, just to be sure that you are on track for student loan forgiveness.
