Does Forbearance Count Towards PSLF? Yes, Here's How

Updated on November 8, 2024

Quick Facts

Forbearance Can Count Towards PSLF: Under specific conditions, forbearance periods of at least 12 consecutive months or 36 cumulative months over the life of the loan can count toward the 120 qualifying payments required for PSLF.
Biden’s Account Adjustments: President Biden’s one-time waivers and account adjustments allow borrowers, particularly public servants, to receive PSLF credit for qualifying periods of forbearance.
Automatic Application for Direct Loan Borrowers: Borrowers with Direct Loans and who have submitted a PSLF application will automatically receive these forbearance credits without needing further action.
Consolidation Required for FFEL and Perkins Loans: Borrowers with older loan types (FFEL and Perkins Loans) must consolidate into a Direct Loan and submit a PSLF form to benefit from the forbearance credit.
Military Deferment Counts: Active-duty military members who placed their loans in deferment while serving can also receive PSLF credit for those periods.

If your MOHELA student loans were unexpectedly placed in forbearance due to recent legal challenges to the SAVE Plan, you might find our article on ‘Why Are My Student Loans in Forbearance with MOHELA?‘ helpful.

Earlier this year, the Education Department announced it would relax the rules for the Public Service Loan Forgiveness Program to allow some forbearance periods to count as qualifying payments. The change is expected to help thousands of teachers, government workers, nonprofit employees, and so on to immediately qualify for forgiveness and push tens of thousands more public servants closer to the finish line.

Keep reading to learn how to get credit for forbearance can increase your forbearance count.

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PSLF Forbearance Count

Although President Biden has yet to use his executive power to authorize mass debt cancellation, his office has been busy finding ways to cancel old student debt. One of its latest attempts to fix the U.S. Department of Education’s student loan system is to use one-time waivers and account adjustments to credit public servants and other borrowers with additional payments toward loan forgiveness.

The changes would give government and nonprofit employees PSLF credit if their accounts were in forbearance for at least 12 straight months. Those borrowers will also see their qualifying payment count increase if their accounts were in forbearance for 36 months or more over the life of the loan.

Here are two examples that show how this benefit works:

If you had a forbearance for 15 straight months, the department will increase your PSLF qualifying payment count by 15.
If your loans have been in forbearance for 48 months, you’ll be four years closer to getting relief.

The Education Department will also give PSLF credit to military service members who put their loans in deferment while on active duty.

Borrowers that have Direct Loans and submitted a PSLF Application will see these benefits automatically applied. If you have other loan types — Federal Family Education Loans and Perkins Loans — you’ll need to consolidate those loans into a Direct Consolidation Loan and submit the PSLF Form to MOHELA before you can benefit from this one-time account adjustment. You can consolidate on the Federal Student Aid website, studentaid.gov.

This forbearance credit is in addition to the loan forgiveness credits federal student loan borrowers have been racking up throughout the pandemic. When the payment pause ends this September, the Covid-19 forbearance will have added 29 months of credit towards PSLF and Income-Driven Repayment Plan forgiveness.

Learn More: IDR Plan Account Adjustment

PSLF changes under Biden

The Biden administration has implemented a set of piecemeal fixes to improve existing student loan forgiveness programs in the last two years. Those changes have led to the Education Department writing off $26 billion in federal loans tax-free.

Public servants are among those who’ve benefited the most from these improvements.

Related: PSLF Changes

For years, tens of thousands of people who spent a decade working in public service were locked out of the PSLF Program. The reason? Despite dutifully paying on their loans for years, many had the wrong types of loans. They had older FFEL and Perkins Loans instead of newer Direct Loans.

Had they known, those borrowers could have easily moved their debts into the Direct Loan Program by consolidating. But the vendors the Education Department hired to help educate borrowers about its forgiveness programs fell asleep at the wheel. Student loan servicers like FedLoan Servicing and Navient let borrowers they knew were working full-time in public service employment keep making monthly payments towards ineligible loans.

Last fall, the Education Department introduced a waiver that promised to fix the so-called “wrong loan” problem — at least temporarily. The Limited PSLF Waiver, which expires in October, gives borrowers PSLF credit for:

Payments made toward FFEL Loans and Perkins Loans.
Late payments.
Payments made under non-qualifying repayment plans (e.g., Extended or Graduated plans).

The PSLF Waiver has been a huge success — for everyone except those with Parent PLUS Loans. Since October, the department has written off $8.1 billion in student debt for 145 thousand borrowers. Parents who borrowed federal Direct Loans for their children can’t use the waiver to shed their debt. But that hasn’t stopped some parents with their own student loans from trying.

Curious if your employer qualifies? Use the PSLF Help Tool to search for eligible employers.

Learn More: Are FFELP Loans Eligible for PSLF?