Published in: Student Loans | July 9, 2019
Denied Public Service Loan Forgiveness? There's Hope for You Yet
By: Kailey Hagen
PSLF can be a lifesaver if you have a lot of student debt. But what do you do if you've been denied loan forgiveness?
Image credit: Getty Images
The Public Service Loan Forgiveness (PSLF) program forgives outstanding student loan debt for graduates working for the government, a nonprofit, or another qualifying organization for at least 10 years. The program launched in 2007, but it got off to a rocky start.
Some borrowers didn't know there were strict rules on which repayment plans counted toward the program. As a result, they accidentally disqualified themselves. Many didn't even realize it until their PSLF Application for Forgiveness was denied.
This problem was so rampant that in 2018, Congress passed the Consolidated Appropriations Act. The Act allotted $350 million for borrowers whose PSLF applications were denied because they selected the wrong repayment plan. The new program is called Temporary Expanded Public Service Loan Forgiveness (TEPSLF). It's a limited-time, first-come-first-served offer. Here's what you need to know about it.
To qualify for TEPSLF, you must fulfill the following requirements:
- Your PSLF Application for Forgiveness and was denied only because some or all your payments weren't made under a qualifying repayment plan.
- You worked for a qualifying employer for at least 10 years and submitted the Employment Certification form every year to prove it.
- You made 120 qualifying payments on a TEPSLF-approved repayment plan.
- The payment you made 12 months before applying for TEPSLF and your most recent payment must be at least as much as you would have paid on a qualifying income-driven repayment plan.
The TEPSLF program expands the eligible repayment plans to include the graduated repayment plan, extended repayment plan, Direct Consolidation Loan standard repayment plan, and the Direct Consolidation Loan graduated repayment plan. But just because you had one of these plans doesn't mean you'll automatically be approved for TEPSLF.
You also have to meet the fourth requirement listed above. The Department of Education will look at the payment you made 12 months before applying for TEPSLF and your most recent payment. It will compare them against how much you would have paid on an income-driven repayment plan.
If you never had an income-driven repayment plan, the government may ask you to provide information on your income and family size to determine what your payment would have been on one of these plans. To qualify for TEPSLF, both of the payments must be at least as much as you would have paid on an income-driven repayment plan.
Who TEPSLF isn't for
The TEPSLF program, like the PSLF program, is only for Direct Loans issued after Oct. 1, 2007. Direct PLUS Loans made to parents, Perkins Loans, Federal Family Education Loans (FFELs), and private student loans are not eligible for TEPSLF. Nor are Direct student loans that you've defaulted on.
You also won't qualify if your PSLF Application for Forgiveness was denied for a reason other than the wrong repayment plan. If your payments were too late or if you forgot to submit your Employment Certification form one year, you can't apply for TEPSLF. But you may still be eligible for PSLF if you keep working for an approved organization until you've made 120 qualifying payments.
How to apply for TEPSLF
If you believe you may qualify for TEPSLF, send an email to TEPSLF@myfedloan.org requesting that the Department of Education reconsider your PSLF eligibility. Include your name and date of birth.
Once you send the email, the Department of Education will verify that you submitted a PSLF Application for Forgiveness and that it was denied because of the wrong repayment plan. If it needs more information from you, the Department will reach out and ask. You should receive an email shortly indicating whether you meet the basic qualifications and are being considered for TEPSLF. Then the Department of Education will investigate your case further and make a ruling on your eligibility within 120 days of the date you sent your email.
If you qualify for TEPSLF, the government will forgive all outstanding Direct student loan debt. Plus, if you've made additional payments after your 120th qualifying payment, the government will consider these overpayments and refund this money to you.
If your TEPSLF application is denied, you should receive an email explaining why and listing suggested next steps. You can also reach out to FedLoan Servicing by phone if you have questions.
TEPSLF is a second chance for those who chose the wrong PSLF repayment plan. If you think you qualify, don't wait to send in your TEPSLF application. Remember, this is first come, first served. When its $350 million is used up, the program is finished. Don't miss out on your chance to have your student loans forgiven.
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