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Federal overhaul equals easing of student debt for public servants

Encouraging news from the U.S. Department of Education earlier this month means many public servants, which includes nurses, teachers, nonprofit employees, government workers, and others, will find it easier to have their student debt forgiven after 10 years of payments.  

The Public Service Loan Forgiveness (PSLF) program was meant to encourage college graduates to spend a good portion of their careers in public service work, which often pays less than private employment, by promising them their student debt remaining after 10 years of payments would be forgiven. But a poorly run and difficult to navigate process meant hundreds of thousands of Americans applied and believed they had met the requirements, but only about 2% were getting their loans forgiven.  

The changes to PSLF are temporary, and systemic problems must still be addressed at the state and federal level. The NCGA should continue to move House Bill 707, which will offer protections to borrowers not covered by the overhaul. But public servants with student debt can assess their eligibility and begin the process of applying for forgiveness here:  

The Department of Education’s PSLF Help Tool.  

The changes are summarized here and include a waiver that will count payments toward credit for the program regardless of the type of loan the student borrower carries. This waiver is in effect until October 31, 2022, so borrowers must apply within the next year.  

Qualifying payments will also be broadened to include payments that were previously not counted because they were off by a small amount or late a few days. Active-duty military will see their months spent serving our country count toward PSLF certification even if their loans were in deferment or forbearance, and will be given automatic credit for PSLF by virtue of their enlistment. The Department of Education will also review denials, correct errors, and improve outreach.  

So many public servants took on careers that paid them less but filled our society’s vital needs. They made sacrifices and poured their talents and energies into work that benefits us all. Their difficulty getting credit after good faith efforts to fulfill the requirements of PSLF have been sad and unjust. We appreciate these temporary improvements and look forward to more progress toward a healthy higher education system through state and federal policy reforms. 


Rochelle Sparko is Director of North Carolina Policy at the Center for Responsible Lending.

For more on student loan debt in North Carolina and the Public Service Loan Forgiveness (PSLF) program, click below to listen to Policy Watch’s recent podcast with Sparko.

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