The Biden administration has reinitiated the processing of applications for the Public Service Loan Forgiveness (PSLF) program, which had been halted during a recent servicing transition. This program allows borrowers to qualify for loan forgiveness after making 120 qualifying payments over a period of 10 years while working for eligible nonprofit or public organizations. The transition of servicing from MOHELA to StudentAid.gov has now been completed, allowing more than 900,000 borrowers to view their qualifying payments and receive approvals for discharges.
Borrowers can now access detailed information about their PSLF qualifying payments through their StudentAid.gov accounts, following the completion of the transition in July. This information includes loan details, payment history, and progress towards eventual student loan forgiveness. Additionally, processing for student loan forgiveness for borrowers who have reached the 120-payment threshold is resuming after a three-month pause that began in May. Borrowers will receive notices from the Education Department and their servicer once the discharge process is complete, which can take up to 90 days.
While the completion of the servicing transition may have resulted in delays in processing student loan forgiveness applications, the Education Department is prioritizing approvals for borrowers who met the PSLF requirements before the pause began in May. It is expected that there may be a backlog of applications to manage, but officials are working to review approvals for forgiveness. Borrowers who qualify for forgiveness based on qualifying payments made during or after May 2024 may experience longer processing times. For those expecting to qualify for PSLF, requesting forbearance is an option to temporarily suspend payments, though this may lead to interest accrual and a rejection of the application if it does not meet the program requirements.
If borrowers believe they have reached 120 qualifying payments but the updates are not yet reflected in their accounts, they can contact their federal student loan servicer to request forbearance. It is advised to continue making payments while waiting for PSLF applications to be processed and student loan forgiveness to be approved, as overpayments will either be applied to other outstanding federal student loans or refunded. Although payment refunds have been issued in the past, the refund process can sometimes be lengthy. While the Education Department has not indicated a specific timeline for processing delays, borrowers are encouraged to stay informed and be patient as the backlog of PSLF applications is addressed.
