Can PSLF Be Retroactive? Yes, Here’s How

‍PSLF is retroactive until Oct. 31, 2022. Borrowers who apply for relief before then can get credit for the payments they made while working in public service, their time spent in forbearance, and some periods of deferment.

Last October, the Biden administration temporarily relaxed the eligibility requirements for the Public Service Loan Forgiveness (PSLF) Program to deliver on the promise made to public servants: make payments for 10 years while working full-time for the government or a nonprofit, and the Department of Education would write off your remaining loan balance tax-free.

Credit for PSLF has been retroactive since then. Borrowers can get past payments to count as qualifying payments, regardless of the loan type, repayment plan, or whether or not it was made in full or on time. Time spent in lengthy forbearances and certain deferments — but not in school deferment — also count towards the 120 payments needed to get PSLF.

Related: PSLF qualifying payments

Time is running out on this unique opportunity. The PSLF Waiver ends on Oct. 31, 2022. You don’t need to have your loans forgiven by that date, but you need to start the process to get retroactive credit before then.

You can apply for PSLF — even if you no longer work for the government or nonprofit — to get credit for some of the payments you made while working in public service.

Before last year, getting credit for payments you made under the wrong repayment plan or towards the wrong types of federal student loans was impossible. But after a series of reports showed just how broken the PSLF Program was — nearly 99% of people who applied were denied debt relief — the Biden administration used powers granted to it because of the pandemic to change the PSLF rules.

The changes allow anyone who has worked full-time for the government or a nonprofit organization after Oct. 1, 2007, to get PSLF credit for any payment they made towards any federal student loan. It doesn’t matter that you have never applied for the program before. All that matters is that you worked for a qualifying employer after the PSLF Program started in the fall of 2007.

Nearly everyone who works full-time for a 501(c)(3) non-profit organization or the local, state, or federal government qualifies for student loan forgiveness after 10 years of service. But some borrowers will need to consolidate their loans or change their repayment plan to meet the program’s requirements.

Normally, consolidating resets your payment count for PSLF. The waiver does away with that penalty. Eligible borrowers who apply for consolidation before the limited waiver ends in Oct. will get credit for the payments they made before consolidating.

Eligible loan types for PSLF:

• Federal Direct Loan Program Loans, including Direct Subsidized and Unsubsidized Loans, Graduate PLUS and Parent PLUS Loans, and Direct Consolidation Loans.

• FFEL Loans if consolidated.

• Federal Perkins Loans if consolidated.

Ineligible loan types for PSLF:

• FFEL Joint Spousal Consolidation Loans

• Parent PLUS Loans*

* Parents who borrowed federal student loans for their education and consolidated those loans with the Parent PLUS Loans they borrowed for their children can qualify for the waiver.

Under the waiver, you can get credit for:

• Any payment you made after Oct. 1, 2007, while working full-time for a qualifying employer. Part-time work can also qualify if you worked for multiple eligible employers and worked a combined average of 30 hours per week. Related: Adjunct professor PSLF.

• Payments made under non-qualifying repayment plans like the Extended or Graduated Plans.

• Payments that were late or for less than the full amount due.

• Time spent in forbearance for 12 straight months or 36 or more cumulative months.

• Time spent in deferment — but not in school deferment — before 2013.

Military service members will get credit for every month spent on active duty, even if their student loan payments were paused.

Related: PSLF Loan Forgiveness News

Follow these steps to complete the PSLF Employment Certification Form.

Step 1: Check the types of loans you borrowed. Although the White House temporarily eliminated many of the complex eligibility rules, you still need to have Direct Loans to qualify for PSLF. Check studentaid.gov to see if you have Federal Family Education Loans or Federal Perkins Loans. If you do, you’ll need to submit a consolidation online by Oct. 31, 2022, to beat the deadline. Read more about how to Consolidate Student Loans for PSLF.

Step 2: Use the PSLF Help Tool to apply. You can also download the PSLF application at the Federal Student Aid website, studentaid.gov. If you use a paper application, make sure your qualifying employers sign the PSLF Forms by Oct. 31, 2022. According to the Education Department, you’ll qualify for the waiver if the forms are signed before the deadline lapses.

Step 3: Complete the employer information. Either you or your employer can complete Section 3 of the application. If you’ve worked for more than one qualifying employer since Oct. 2007, then you’ll need to submit separate applications for each job.

• How can I check if I worked for a qualifying employer? You can use PSLF Help Tool to search the employer database using the employer’s identification number from your W2.

• What if the company is no longer in business, or you have trouble finding someone to sign the form? Complete Section 3 and then go back to Section 2 and mark the box at the bottom of page 1. The Education Department will help you try to certify your employment. Read more about qualifying employers for PSLF.

Step 4: Submit the application to the student loan servicer. Until this year, FedLoan Servicing held an exclusive contract with the U.S. Department of Education to service all loans enrolled in the public service program. The department hired MOHELA to replace FedLoan as the program’s administrator after the company announced it was ending its contract with the government at the end of 2022. If you haven’t confirmed your PSLF eligibility, send the certification form to MOHELA for processing.

If you had to consolidate, wait until the consolidation is finished before submitting the PSLF Form to MOHELA.

The limited waiver doesn’t guarantee that your loans will be forgiven. Instead, it promises to give you credit for the monthly payments you made while working in public service. If you’ve already made 120 qualifying payments, the Education Department will write off your remaining balance. Otherwise, you’ll need to deal with the debt that remains.

Thankfully, there are a few options you can take advantage of, depending on your circumstances.

• If you still work in public service, enroll in an income-driven repayment plan and keep making monthly payments until you’ve made enough qualifying payments.

• If you no longer work in public service, consider enrolling in an IDR Plan and look into getting your loans forgiven after 20 to 25 years of payments. Read more about IDR Plan Forgiveness.

Regardless of your work status, check your eligibility for Biden’s cancellation plan. Over 40 million federal student loan borrowers are eligible to get at least $10 thousand knocked off their loan balance. Read more about $10,000 student loan forgiveness.

If you’ve ever held a public service job, you may be able to get credit for the payments you made at the time. You’ll need to move quickly, though. The opportunity to get that extra credit ends on Oct. 31, 2022.

Let’s talk if you want help navigating this process to ensure you qualify.

Learn More: Do Charter Schools Qualify for Public Service Loan Forgiveness?