Overhaul to Public Loan Forgiveness

[carrotsmakemefat]

Would any changes to student loan forgiveness impact anyone here ? I’m interested to see how this shakes out.

woub.org/2021/10/01/a-troubled-public-service-loan-forgiveness-program-will-get-an-overhaul/

[ChillyMcFreeze]

Interesting, I just posted about PSLF in the randoms for today. I've made 120 payments while working in public service, but I haven't always been under the right repayment plan. (Because I've been earning a pittance working in public service!) If they're giving credit for payments under different plans, I might be much closer to qualifying. I guess I need to get my ass in gear and check it out.

[Doggy Mommy]

Thank you for posting this. I work in education and have been paying my student loans since 2005. They are consolidated and not the right type of loan for public service loan forgiveness. If these changes make all of my payments eligible, it's possible the rest of my loan could be forgiven (9k).

[ans1999]

I really wish they would allow more lenience with the "qualifying repayment" plan. I'm a public school counselor so I don't make a ton. However, my husband's income is factored. Therefore, I have to pay my full payment and don't qualify for the other payment plans. 

[leshoequeen]

I'm trying not to get my hopes up, but this would be huge for me.

[wildrice]

Wow, it sounds like mine may be! I've been working at non profit employers for most of 13 years but my loans have only been on income based plans for about 5 of those so far. It would be amazing if mine went away!

Of course, my H would still have over 8 years on his and since they are income based, we wouldn't save any actually monthly payment money. Still, it would be nice to dump the debt off my back.

[gretchenindisguise]

I'm also trying not to get my hopes up - but there is a potential with these overhauls that my federal loans could be extinguished. That would be huge.

[lessel]

I'm so glad this is happening and really hope a ton more people can use this. I would have been eligible if not for my loan type...I consolidated and apparently didn't do it via the right mechanism for this? I dunno. That whole system was a mess though and even trying to sort out whether my loan was eligible was a nightmare. My SLs are paid now so I won't benefit, but I'm SO GLAD for others who will be able to.

[carrotsmakemefat]

This is huge for me too. I’ll be keeping an eye out for any official news next week. I got stuck in that rut of payments under the wrong plan and when they told me I’d owe over 1k a month to qualify I pretty much sobbed.

I’m glad GAO finally did a review on this. If less than 8% of people qualify or had anything forgiveness that shows there was a lack of authenticity from the beginning

[karinothing]

Oct 4, 2021 11:34:40 GMT -5 ans1999 said:

I really wish they would allow more lenience with the "qualifying repayment" plan. I'm a public school counselor so I don't make a ton. However, my husband's income is factored. Therefore, I have to pay my full payment and don't qualify for the other payment plans. 

Can you file your taxes separate and get on under the IBR repayment plan? That is how I qualified.

I really hope this works out and helps folks. Having my loans forgiven (298K!) was life changing for me.

[ans1999]

Oct 4, 2021 13:13:06 GMT -5 karinothing said:

Oct 4, 2021 11:34:40 GMT -5 ans1999 said:

I really wish they would allow more lenience with the "qualifying repayment" plan. I'm a public school counselor so I don't make a ton. However, my husband's income is factored. Therefore, I have to pay my full payment and don't qualify for the other payment plans. 

Can you file your taxes separate and get on under the IBR repayment plan? That is how I qualified.

I really hope this works out and helps folks. Having my loans forgiven (298K!) was life changing for me.

I didn't know that I could do that! I will look into it with our tax person. It could be a lot of savings for us in the long run.

[kimmyo73]

This would be massive for me.  I'm in the wrong payment plan but have 8.5 years of on-time payments and years of public service.  I did have a small gap in employment that might mean paying a bit longer than 10 years.  These changes would mean a light at the end of the tunnel and that I would be out of student loan debt before my eldest child starts college.  Being able to help her avoid this level of debt would be life altering for generations.

[karinothing]

Oct 4, 2021 13:14:43 GMT -5 ans1999 said:

Oct 4, 2021 13:13:06 GMT -5 karinothing said:

Can you file your taxes separate and get on under the IBR repayment plan? That is how I qualified.

I really hope this works out and helps folks. Having my loans forgiven (298K!) was life changing for me.

I didn't know that I could do that! I will look into it with our tax person. It could be a lot of savings for us in the long run.

Yes, we filed separate for 10 years (I just qualified for PSLF this past summer). Here is some information:

www.ibrinfo.org/existingidr.vp.html

There are downsides to filing separate (you can't contribute as much to a FSA for example) but my payment was 2300 with both salaries and under $500 with just mine. So it made more financial sense for us (especially with forgiveness thrown in).

[carrotsmakemefat]

Oct 4, 2021 13:24:11 GMT -5 karinothing said:

Oct 4, 2021 13:14:43 GMT -5 ans1999 said:

I didn't know that I could do that! I will look into it with our tax person. It could be a lot of savings for us in the long run.

Yes, we filed separate for 10 years (I just qualified for PSLF this past summer). Here is some information:

ibrinfo.org/pslf.vp.html

There are downsides to filing separate (you can't contribute as much to a FSA for example) but my payment was 2300 with both salaries and under $500 with just mine. So it made more financial sense for us (especially with forgiveness thrown in).

Just curious - was your loan amount based on your salary when you first qualified ? Not any promotions in between ?

If I remember correctly you are a fed, correct ?

[karinothing]

Oct 4, 2021 13:27:14 GMT -5 carrotsmakemefat said:

Oct 4, 2021 13:24:11 GMT -5 karinothing said:

Yes, we filed separate for 10 years (I just qualified for PSLF this past summer). Here is some information:

ibrinfo.org/pslf.vp.html

There are downsides to filing separate (you can't contribute as much to a FSA for example) but my payment was 2300 with both salaries and under $500 with just mine. So it made more financial sense for us (especially with forgiveness thrown in).

Just curious - was your loan amount based on your salary when you first qualified ? Not any promotions in between ?

If I remember correctly you are a fed, correct ?

My payment  you mean? I had to file paperwork each year so it changed each year. I have gone from being a GS9 to GS13. The payment is based off your AGI, so I did all I could to reduce that (filed separate, put all I could into dependent care and healthcare FSA, paid insurance, and put 20% into retirement). Then I was married with 2 kids so that reduced it more. IBR = 15% of discretionary income, up to the fixed 10-year payment amount.

[Jalapeñomel]

I have zero faith this will work for most of us. #pessimist

[carrotsmakemefat]

Oct 4, 2021 13:32:46 GMT -5 karinothing said:

Oct 4, 2021 13:27:14 GMT -5 carrotsmakemefat said:

Just curious - was your loan amount based on your salary when you first qualified ? Not any promotions in between ?

If I remember correctly you are a fed, correct ?

My payment  you mean? I had to file paperwork each year so it changed each year. I have gone from being a GS9 to GS13. The payment is based off your AGI, so I did all I could to reduce that (filed separate, put all I could into dependent care and healthcare FSA, paid insurance, and put 20% into retirement). Then I was married with 2 kids so that reduced it more. IBR = 15% of discretionary income, up to the fixed 10-year payment amount.

Ok I was curious. Mine has always been quoted over $1k a month to qualify. But I didn’t have a kid until just recently. I’m a 14 now but gave up when I was a 12

[kimmyo73]

OMG - I just looked at my loans and if this forgiveness doesn't happen then I won't finish paying them off until November 2042. FML.

[jackie011]

I never pay much attention to this stuff because despite working for the federal government for 18 years, and making SL payments for most of that time, I don’t think DH qualifies. He consolidated early on to a private company and I think we’re stuck regardless of what plans they put in place 😤

[killercupcake]

Oct 4, 2021 13:14:43 GMT -5 ans1999 said:

Oct 4, 2021 13:13:06 GMT -5 karinothing said:

Can you file your taxes separate and get on under the IBR repayment plan? That is how I qualified.

I really hope this works out and helps folks. Having my loans forgiven (298K!) was life changing for me.

I didn't know that I could do that! I will look into it with our tax person. It could be a lot of savings for us in the long run.

Yeah, you can. It’s what’s recommended to do. Contact your tax person ASAP!

[killercupcake]

It doesn’t change anything for me. I still have another 4ish years to go.

[carrotsmakemefat]

Oct 4, 2021 14:16:29 GMT -5 jackie011 said:

I never pay much attention to this stuff because despite working for the federal government for 18 years, and making SL payments for most of that time, I don’t think DH qualifies. He consolidated early on to a private company and I think we’re stuck regardless of what plans they put in place 😤

Yes. I think once you consolidate privately you’re SOL. I really want to consolidate into a lower interest rate and this is why I haven’t.

[karinothing]

Oct 4, 2021 13:47:57 GMT -5 carrotsmakemefat said:

Oct 4, 2021 13:32:46 GMT -5 karinothing said:

My payment  you mean? I had to file paperwork each year so it changed each year. I have gone from being a GS9 to GS13. The payment is based off your AGI, so I did all I could to reduce that (filed separate, put all I could into dependent care and healthcare FSA, paid insurance, and put 20% into retirement). Then I was married with 2 kids so that reduced it more. IBR = 15% of discretionary income, up to the fixed 10-year payment amount.

Ok I was curious. Mine has always been quoted over $1k a month to qualify. But I didn’t have a kid until just recently. I’m a 14 now but gave up when I was a 12

Yeah it is hard because I don't really know how their calculations work. But I just focused on bringing my AGI down..so I think even as a gs13 my AGI was never over 85k. I also have two years where I had 3 months of LWOP due to maternity leave, which lowered my income

[plutosmoon]

I hope this helps some borrowers. From the start, the program always felt like it was set up to fail. I remember thinking there were too many rules the average borrower wouldn't understand.

My ex and I tried to qualify when this first came out and the payment in the qualifying plan was just higher than the amount we were paying, so I never bothered. basically the income based repayment paid us off at around the 9 year mark. At the time I was in entry level higher Ed and he was a second year public school teacher. I was surprised at the payment amount and irritated no prior payments would count at that time. Several years later, my ex qualified for income based when they changed the formula and we had a kid.

[karinothing]

www.washingtonpost.com/education/2021/10/06/public-servant-loan-forgiveness/

More details this morning

[Jalapeñomel]

Mine were reset to the beginning because I did the other teacher loan forgiveness. I’m still bitter that they both don’t count toward 10 years, so it’ll actually be at least 15 years to forgiveness.

[okla]

If this really works the way it says it will, it will be huge for my H and I. He is already pretty close with the right payments plan and loan type, but he made payments before he consolidated, so this may push him over the edge. And I have two loans, one the “correct” one and the other a fed loan, but not the right kind. I didn’t realize that the larger loan wasn’t the right kind for forgiveness until I was 7 years in and then didn’t want to start the clock over. I’m pretty sure I’ve already hit 120 payments. Gonna check this all out today.

[wildrice]

This is crazy (and also not, because it should have been this way all along lol). I really think I might qualify.

[starryfish]

I’m confused as to whether I now qualify. Been repaying SL since 2009/2010. I’m a fed since before that. But been doin the graduated repayment plan (not income). My loans are a consolidated direct loan. Will I qualify??

[carrotsmakemefat]

Oct 6, 2021 7:36:59 GMT -5 okla said:

If this really works the way it says it will, it will be huge for my H and I. He is already pretty close with the right payments plan and loan type, but he made payments before he consolidated, so this may push him over the edge. And I have two loans, one the “correct” one and the other a fed loan, but not the right kind. I didn’t realize that the larger loan wasn’t the right kind for forgiveness until I was 7 years in and then didn’t want to start the clock over. I’m pretty sure I’ve already hit 120 payments. Gonna check this all out today.

Let me know! Seems if consolidate with Direct Loans I’ll qualify. But I can’t get excited yet !