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March 24, 2022

Public Student Loan Pause – Do You Know Your Forgiveness Options?

Payments, interest, and collections efforts on most federal student loans have been suspended since March 2020 as part of the CARES Act. This relief, originally intended to last six months, has been extended several times. In early April 2022, this relief was extended through Aug. 31, 2022. 

For the duration of this relief package,

  • No payments are due on government-held federal student loans
  • No interest is accrued on government-held federal student loans.
  • The months where payments were “paused” during this relief extension continue to count towards student loan forgiveness programs, including Public Service Loan Forgiveness (PSLF).

What’s the Public Service Loan Forgiveness Program?

The PSLF is a program that predates the pandemic. The PSLF Program, which was established under the College Cost Reduction and Access Act of 2007, cancels loans after 10 years of public service-which includes working for a governmental organization, a 501(c)(3) organization, or a not-for-profit organization that provides a designated public service (including emergency care). Detailed requirements about how to qualify for forgiveness under this program are provided on the Public Service Loan Forgiveness page.

While well intended, the PSLF had complicated rules about which payments qualified for loan forgiveness (individuals have to make 10 years' worth of qualifying monthly payments (i.e., 120 payments) to get their loans forgiven.) Some individuals thought they made all their payments only to find out they were making the wrong types of payments-and their loans were ultimately not forgiven.

On Oct. 6, 2021, the U.S. Department of Education announced a set of actions to reform the Public Service Loan Forgiveness (PSLF) Program, making it easier for individuals to get their loans forgiven.

The Department of Education introduced a temporary waiver to give individuals credit for prior payments they made that would not otherwise count toward PSLF. It is also introducing other changes to streamline and simplify the program. The waiver will run through October 31, 2022.

As you prepare for the expiration of the federal loan payment pause, you may be wondering:

These questions – and many more – are answered in detail on the Department of Education’s website.

If those website Q&As don’t give the answers you need, there are numerous contact centers ready to help through phone calls and live chats. Sometimes the best option is connecting with a real person in that department who can walk you through the process. 

Read more: A young physician shares her personal experience trying to decide whether the PSLF was a better option for her than refinancing. 

Another Option:  Refinancing

As you think about what to do as the pause on federal student loan payments ends, there is another option: refinancing your loan. Your ACEP membership comes with refinancing discounts.

Refinancing your loan can help you lock in a lower interest rate and lower your monthly payments. However, be aware that refinancing your loan through a private lender will cause you to lose your federal benefits and protections, like income-driven repayment, deferment, and loan forgiveness.

To help compare the benefits of federal student loans to the benefits of refinancing, click here. It is important to assess all your options before deciding the best one for you.

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